Interest is calculate on drawing power amount instead of outstanding amount.

POSTED BY rama krishna ON November 1, 2012 6:21 pm COMMENTS (2)

Dear Mr Manish,

Actual home loan taken : 7,80,000/-

part payment done a year ago: 50,000/-

after paying the EMi for around 4 years,

outstanding amout = 4,68,000/-

Drawing power = 5,18,000/-

interest rate = 10% 

If I use the emi calculator I must be charged 3900/- for the outstanding amout but its statement shows I need to pay aprox 4400 interest, which is calculated on drawing power. Why is it? I think SBI should charge the interest on outstanding not on the drawign power. Please clarify…!

 

Thanks

-Rama krishna

2 replies on this article “Interest is calculate on drawing power amount instead of outstanding amount.”

  1. Ashal Jauhari says:
    February 17, 2013 at 1:56 am

    Dear Rama, which home loan product of SBI, are you using? Is it Max Gain?

    Please confirm.

    thanks

    Ashal

    Reply
  2. Manish Chauhan says:
    November 2, 2012 at 1:23 pm

    Ramakrishna

    Its as simple as looking at your agreement, which should clearly define on what amount will it be charged. Incase bank is not following its own agreement, your next step has to be look at the other options like complaining to banking ombudsman on this or reaching to consumer court .

    Manish

    Reply

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