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Atul Saxena on 03 January 2012
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LIC housing loan interest rate regarding

I am planning to buy a new house and for the same I contacted couple of bank for the home loan. The rate of interest of lichfl was showing 0.40 and everybody else was 10.75/11.0%. Mr sanjay assured me this is the best deal/Offer you can get and I should go for it. Lichfl works of lhplr, I gave him a cheque of rs.5515/- Which is encashed last week and I received the sanction letter yesterday which states that 0.40 is the offer rate and after 3months or prior it will be changed to 14.40% - 305bps from the sanction letter "the rate of interest of 10.40% will be applicable for 3 months or next review date as per clause 2.2a of terms and conditions of home loan documentation kit. Thereafter applicable rate will be lhplr minus 305bps." That means immediately they will be start charging 11.35% this should be told before by the executive that ths promotion offer is just for 3 months so the customer can decide before giving money for processing. I know I will not get any refund but I want everybody aware of this.

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Hi I also have home loan from lichfl and I am paying intrest 11.9% .. I want to know is... is there any procedure in lichfl to pay some upfront fees and reduce the interest rate as per new customers?

Nageswara Rao

As per the agent thru whom I got this loan there is no such option of paying a minimal amount for conversion to a loan at lower interest rates. I will wait for a few months to see if the interest rates come down as my loan is a floating rate loan. Else I will shift to a bank with better options.

Abdul Razzaq

@Nageswara rao: shifting to other bank should be a good idea because I don't think the lhplr will come down till the month of march. And even after march that depends on rbi and then LIC will make decision to fix the basic interest rate. And in the whole period of time we will be charged 11.9% and grilled down....


When all the banks have reduced interest rate lichfl dont even consider existing customers it is at 11.90 and when called the customer care and officers they are least bothered to listen. They just say you can close the loan.


There is no facility to switch for different scheme. Only option to do prepayment or goto different bank. Interest rate wont come down unfortunately mine is gram panchyat property whole layout needs to go for approval for regularisation which builder wont do. Stuck badly. Lichfl smartly trapped customers


We customers don't understand how finance companies operate initially in hurry of closing the deal we tend to go with a banker suggested by builder and fall in trap. Banker will give 3 or 6 months offer and squeeze money from then. And then we realize what mistake is been done. Though pain sbi seems to best to deal with.

Lichfl is not a good option to chose. At-least one new customer should read this and go away from lichfl.