[Resolved]  HDFC Bank Home Loans — Unethical Floating Interest Rates

Hi,

I have take a Floating rate home loan from HDFC Bank. I felt that they are not reducing the rate even though RBI has been slashing the Rate.
I took the Home Loan in Dec 2006 at 9% and now in Dec 2008 my interest rate is 11.75% which would be reduced to 11.25% on 1st March 2009.

As far as I understand Floating Interest rate should depend on RBI Repo rate and CRR. But, HDFC seems to be charging very different rates for almost same CRR and Repo Rate

At Dec 2006: CRR was 5.5% and is still 5.5%. Repo rate was 7.25% but is now reduced to 6.5%. So, I would assume that HDFC and all other HFCs should have lesser Floating rate then it was in Dec 2006 or at least same. But, HDFC used to charge 9% and is right now charging 11.25%.

Also, I have other issues with their operations
1. They favour New customers by offering less interest rate but later migrate them to higher rates. This way new customers are usually fooled but gets to pay higher rate within 3 months. They also have clueless Sales people.

2. The RBI and Finance Ministry has recommended that HFCs should have different interest rates for below 20 lac and above 20 lac home loans. SBI has this policy but HDFC is not doing this. They have recently decided to do it for New customers but exisiting customers are not getting this. Not able to understand why they do not want to extend it to existing customers.

I still feel that they are better then all other Private HFCs but way behind SBI and other PSU banks who are at least sticking to Finance Ministry or RBI instructions.

Also, you can not approach RBI against them since they are not regulated by RBI. When I contacted them for complaints they said there is only Consumer courts to go to.