Starting Nov 21, 2011, SBI will not charge pre-payment penalty on its home loans. RBI has been pushing banks to drop the penalty for a while and finally, some one stepped up to the plate.
There were two kinds of pre-payment that customers did- paying off from their own funds or through a loan from another bank. Some charged penalty only if you paid off your loan from another bank. But now SBI has said NO penalty to any kind of pre-payment.
This is good news, as pretty soon other banks will have to follow suit to keep up with the competition.
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