North India Statesman
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News India Live, Digital Desk: Have you also taken a home loan to buy your dream house? If yes, your concerns about the growing EMI and loan period will be justified for some time. When interest rates increase, banks increase your EMI or make your loan duration so long that you get tired of calculating. But now, the Reserve Bank of India (RBI) has found a solution to this big problem! Rbi Has implemented a rule that will provide great relief to those taking home loans and will be able to manage their money better.
What was the problem, and what has changed now?
What used to happen earlier? When the interest rates used to rise (eg when the repo rate rises), the banks used to increase your EMI without asking you or to make your loan repayment period so long that sometimes it used to be more than your retirement age. You did not get complete information about this, and you just used to pay increased installments.
But now RBI has strengthened the rights of home loans. Now what rights you will get, let’s understand:
1. Complete information, your right:
Now the bank has to clearly tell you before making any changes in your EMI or loan period. They also have to tell what will affect your total loan cost with these changes. There is no hidden hidden!
2. Freedom to choose, in your fist:
This is the biggest relief! Now the bank will not only give you information about the change, but will also give you many options, and you will be able to choose from them:
, EMI enhancing: If you can increase your EMI, then your loan can be repaid quickly.
, Extending duration: If you do not want to increase EMI, you can extend the loan duration for some more time (the bank must ensure that the duration is not more than 30 years).
, Switch at fixed interest rate: This is a great option for those who want to avoid uncertainty of future interest rates. You can switch to the fixed interest rate from floating, that is, your EMI will be the same.
, Partial or complete pre-payment: You can pay some part of your loan or full loan at any time without any additional fee (foreclose charge). This will reduce your interest burden.
3. Account of everything, in easy language:
The bank will now have to give a statement every year. It will be clearly written in this statement that how much money you have paid as Principal and Interest, and how much principal your loan remains. With this, you will be able to track the progress of your loan easily.
Who will get this benefit?
This new rules 1 January 2024 Are implemented from These will not only apply on the new home loan, but also to your current floating interest rate home loans. And it is not limited to home loans only, but will also apply to all retail loans (eg car loans, personal loans) and loans of MSME (small-middle enterprise).
In short:
This is a very important step of RBI, which gives home loans to take more transparency, control and flexibility. Now you will be more secure than the uncertainty of interest rates and will be able to manage your loan as per your convenience. So next time your bank contacts you, remember these new rights and choose the best option for yourself!
