Wednesday, December 8, 2010

Tata Shubh Griha Vashind - Allotment of Flats

Tata Housing has just declared the allotment of the 1300 Shubh Griha flats (1 RK / 1 BHK) being sold at its new Vashind project. It is believed to have been oversubscribed several times over and thus the allotment has been made through a lottery.

For a list of the successful applicants, please click on
Tata Shubh Griha Vashind allottees

Of course, this is an approved project for MHFC and hence, we will finance successful allottes (subject to our terms and conditions - for more details, please see our website or call for more information on 22660427 / 22660130).

Separately, MHFC also has a special quota of 208 flats on the same project (which we will be allotting on a first come first served basis) so unsuccessful allottees who meet our criteria can call us for a chance to get an allotment.

Tuesday, December 7, 2010

Prepayment Charges

Since its inception, MHFC has had a NIL prepayment charge policy. This is because we encourage our customers to be debt free (esp on their homes) as soon as possible. Also, since funding for banks and HFCs is mostly on a floating basis (and can be likewise repaid without any charge), there is very little justification for a lender to charge a fee if the customer decided to prepay a loan. In any case, with growth rates in the home loan business being 30% p.a approx, funds paid back can always be deployed again fairly easily. The RBI is also looking at this issue seriously as it has received several customer complaints on high prepayment charges (we believe the normal market range is a flat fee of anywhere between 1% and 5%).

In this context, today's letter to the Ask Mint Money column is quite shocking - a customer has written in saying that he has a home loan of 8 lakhs and wishes to prepay 4 lakhs. But the HFC is asking him to pay a 10% service charge and 2% in admin charges. This seems incredibly high - and at face value works out to a 48,000 Rs prepayment fee !!!

Link to Mint Money article