Shift to SBI Maxgain or Not?

POSTED BY Prasanna ON July 11, 2012 2:52 pm COMMENTS (5)

Hi All,
Need a suggestion.
I have a current outstanding housing loan of 16.85L with HDFC @ 10.75% Interest. I am paying monthly EMI of 30K. (have another 76 more months to finish my loan).

After reading about SBI Maxgain in these forums wanted to check if

1) It would make sense to shift to Maxgain. SBI said interest rate is 10.5%. Checked up with HDFC no prepayment penalty if I move to SBI.

I am aged 34 and my monthly salary is 90K (after tax). Of this approximate 20K goes out for various LIC Insurances, 10K for Equity MF SIP. 5K for Gold. 30K for EMI. 5K for Utilities and Bills. Family is run by my Wife\’s Salary including my kid\’s school fees etc.,

Over the years have created the following corpus
Stocks – 7 L
Equity MF\’s – 2 L

Will taking Maxgain help me out, thought will keep the surplus as emergency funds in the maxgain\’s OD account, as I always move my emergency funds to Equities. Also I am not planning to liquidate my corpus at this juncture and they may stay just as stocks and funds as of now.

Thanks,
Prasanna

5 replies on this article “Shift to SBI Maxgain or Not?”

  1. TheZionView says:
    July 11, 2012 at 10:03 pm

    @ashal,

    Please let me know the reasoning behind recommending to continue with HDFC instead of switch to maxgain? Wanted to know the points behind it.

    Reply
    1. Ashal Jauhari says:
      July 12, 2012 at 2:49 pm

      Dear TheZionview, the loan amount is less, 16.85L Rs. roughly. Remaining term is also very low (just more than 6Y) Interest rate is also almost same. There ‘ll be processing charges on SBI loan. As it ‘ll be a refinance from personal experience I do know arranging papers for loan sanction is really a tough task.

      Also the fact that apart from emergency funding, no other saving is there to get the benefit of Max Gain.

      if the person opts to increase his regular EMI with HDFC itself, the benefit ‘ll be immediate & the loan ‘ll close very fast. No intermediary paper work……

      Hope I’m clear to you.

      Thanks

      Reply
      1. Prasanna says:
        July 12, 2012 at 3:31 pm

        Thanks Ashal. I ididn’t factor in the procedural work I may need to incure when transferring the loan. Will try to stay with HDFC and keep paying off the loan fast.

        Reply
        1. Ashal Jauhari says:
          July 12, 2012 at 3:48 pm

          Dear Prasanna, please feel free to discuss in future also.

          thanks

          Ashal

          Reply
  2. Ashal Jauhari says:
    July 11, 2012 at 3:23 pm

    Dear Prasanna, please continue with HDFC & in case you want to prepay early, please increase your EMI amount or prepay in between intermittently. By the way, I’m unable to understand this emergency fund to Eq. thing. Can you elaborate more on this?

    Thanks

    Ashal

    Reply

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