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HDFC Home Loan - Processing Fee, Pre-Closure and Other Charges

HDFC Ltd is the premier Home Loan financing institution in India. HDFC has been around since the late 1980s when nationalised banks did not venture into the Home Loan financing segment. Over the years, HDFC has built up a reputation for being one of the most reliable Home Loan financiers. Some of the features of HDFC Home Loan are transparency in services, attractive interest rates, and other aspects such as low processing fees, reasonable prepayment charges, and so on.

HDFC Bank Loan Processing Fees

Processing Fees	0.50% of the loan amount with a minimum of 3,000
External opinion charges	Advocate fees: On actual basis Valuation fees: On actual basis These fees are payable directly to the concerned advocate/valuers for the services rendered by them.
Insurance of property	Customers should pay the insurance premium directly to the insurance company and ensure that the policy is in force.
Delayed payment charges	Customer is liable to pay interest @24% per annum on the delayed EMI
Incidental charges	Charges connected with the recovery of dues of defaulting customers are to be added to the overall dues and recovered.
Statutory charges	Stamp Duty, CERSAI Registration charges, and other statutory charges are payable by the customers.

Schedule of Other Charges

Type of Charge	Amount
Cheque dishonour charges	200
Obtaining a list of documents	Up to 500
Photocopy of documents	Up to 500
PDC swap	Up to 200
Cancellation of disbursement cheque post disbursement of the Home Loan	Up to 200
Re-appraisal of the Home Loan after 6 months from the sanction	Up to 2,000
Change in the loan repayment term	Up to 500

HDFC Home Loan - Prepayment Charges

HDFC offers Home Loans on floating rate, fixed-rate, and a combination of floating and a fixed rate of interest. HDFC allows foreclosure of Home Loans subject to payment of a pre-closure penalty depending on the category of the borrower.

Adjustable-Rate Home Loans and Combination Rate Home Loans (variable interest period)

Individual borrowers
No prepayment charges are payable by the customer on part/full repayment in advance. The source of funds can be own sources or Balance Transfer facility availed from other banks.
Non-Individual borrowers
This category of borrowers includes sole proprietorship concern, company. Partnership firms or HUF as co-applicants to the loan. The prepayment charges are as follows:
If the loan is prepaid within 6 months from the date of initial disbursement	Prepayment charges @2% of the prepaid amount
After 6 months and up to 36 months from the date of initial disbursement	The borrower has the option of repaying up to 25% of the opening principal balance of the loan every financial year without incurring any prepayment penalty. However, this facility is permitted only if the borrower repays the advance from their own sources.
	Amounts exceeding 25% shall attract prepayment penalty @2% of the amounts exceeding 25% every financial year.
After 36 months	No prepayment charges if the borrower repays the loan from own sources. If there is an involvement of balance transfer, the borrower is liable to pay pre-payment charges.

Fixed-Rate Loans and Combination Rate Home Loans (fixed interest period)�

Individual borrowers
Loans repaid from own sources	No prepayment penalty
Loans repaid through refinance from other banks/NBFC	2% of the outstanding amount prepaid
Non-Individual borrowers
This category of borrowers includes sole proprietorship concern, company. Partnership firms or HUF as co-applicants to the loan. The prepayment charges are as follows:
If the loan is prepaid within 6 months from the date of initial disbursement	Prepayment charges @2% of the prepaid amount
After 6 months and up to 36 months from the date of initial disbursement	The borrower has the option of repaying up to 25% of the opening principal balance of the loan every financial year without incurring any prepayment penalty. However, this facility is permitted only if the borrower repays the advance from their own sources.
	Amounts exceeding 25% shall attract prepayment penalty @2% of the amounts exceeding 25% every financial year.
After 36 months	No prepayment charges if the borrower repays the loan from own sources. If there is an involvement of balance transfer, the borrower is liable to pay pre-payment charges.

Conversion Fees

Customers have the option to reduce their interest liability by switching between different schemes (variable interest and fixed interest schemes). However, switching over to another plan entails payment of conversion fees.

Product/Service	Name of Charge	Payable	Frequency	Amount
Switch to lower ROI (Home Loans for housing, extension, and improvement)	Conversion fees	On conversion	Every time the spread changes	Up to 0.50% of the outstanding principal amount and undisbursed loan amount subject to a cap of 50,000.
Switching to Variable ROI from Fixed ROI (Housing, Extension, and improvement)	Conversion fees	On conversion	One-time charge	Up to 50% of principal outstanding and undisbursed portion of loan subject to a ceiling of 50,000.
Switch from Trufixed Fixed Rate to a Variable ROI	Conversion fees	On conversion	One-time charge	1.75% of the principal outstanding and undisbursed portion of the loan amount at the time of conversion.
Switch over to a lower rate of interest (Non-housing loans)	Conversion fees	On conversion	Every time the spread changes	Minimum of 0.50% and a maximum of 1.50%
Switch to a lower rate (Plot Loans)	Conversion fees	On conversion	Every time at the change of spread	0.50% of principal outstanding and undisbursed amount, if any.