New RBI Home Loan EMI Rule: Everyone will be impacted (Positively)

Photos: Pexels/Pixabay Photos: Pexels/Pixabay Aug 10, 2023 Rajeev Kumar

Soon, banks will not be able to increase your home loan EMI tenor without asking you. This will be possible due to a decision by RBI. Read on for details

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RBI has noticed instances of unreasonable elongation of tenor of floating rate loans by lenders without proper consent and communication to the borrowers.

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To check this practice, RBI has decided to put in place a proper conduct framework to be implemented by all REs to address the issues faced by the borrowers.

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The framework will make it mandatory for banks to clearly communicate with the borrowers for resetting the tenor and/or EMI.

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The banks will also have to provide options of switching to fixed rate loans or foreclosure of loans.

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Further, lenders will have to make transparent disclosure of various charges incidental to the exercise of these options.

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Increasing tenor even by a few months can lead to a big increase in the total interest paid during loan repayment term.

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RBI's decision will positively impact borrowers as banks will become more transparent about their decisions. More details will be available soon.

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New RBI Home Loan EMI Rule: Everyone will be impacted (Positively)

New RBI Home Loan EMI Rule: Everyone will be impacted (Positively)

Soon, banks will not be able to increase your home loan EMI tenor without asking you. This will be possible due to a decision by RBI. Read on for details

Soon, banks will not be able to increase your home loan EMI tenor without asking you. This will be possible due to a decision by RBI. Read on for details

RBI has noticed instances of unreasonable elongation of tenor of floating rate loans by lenders without proper consent and communication to the borrowers.

RBI has noticed instances of unreasonable elongation of tenor of floating rate loans by lenders without proper consent and communication to the borrowers.

To check this practice, RBI has decided to put in place a proper conduct framework to be implemented by all REs to address the issues faced by the borrowers.

To check this practice, RBI has decided to put in place a proper conduct framework to be implemented by all REs to address the issues faced by the borrowers.

The framework will make it mandatory for banks to clearly communicate with the borrowers for resetting the tenor and/or EMI.

The framework will make it mandatory for banks to clearly communicate with the borrowers for resetting the tenor and/or EMI.

The banks will also have to provide options of switching to fixed rate loans or foreclosure of loans.

The banks will also have to provide options of switching to fixed rate loans or foreclosure of loans.

Further, lenders will have to make transparent disclosure of various charges incidental to the exercise of these options.

Further, lenders will have to make transparent disclosure of various charges incidental to the exercise of these options.

Increasing tenor even by a few months can lead to a big increase in the total interest paid during loan repayment term.

Increasing tenor even by a few months can lead to a big increase in the total interest paid during loan repayment term.

Why it is important for borrowers?

Why it is important for borrowers?

RBI's decision will positively impact borrowers as banks will become more transparent about their decisions. More details will be available soon.

RBI's decision will positively impact borrowers as banks will become more transparent about their decisions. More details will be available soon.