The Hindu Business Line : New housing loan from Dhanalakshmi Bank

DHANALAKSHMI Bank has announced a new housing loan product that would offer the advantage of both fixed and floating rates. The Bank has linked the loan to the bank rate of the RBI for more transparency to customers. With industry linking the loan to the prime lending rate, borrowers would be subject to frequent changes with the change in PLR of a bank. However, with the RBI rate remaining stable for long, such a volatility could be averted extending a low interest to the customers.

Announcing the scheme at a press conference here on Saturday, Mr P.S. Prasad, Managing Director and CEO, said the `Grihalaksmi Home Loan' was designed in such a way that the borrower paid only 6.75 per cent till March 2006, and afterwards the bank would charge 7 per cent. This rate would be linked to the Bank Rate to be announced by the RBI from time to time.

Mr Nagesh S Belur, Executive Director, said the bank had fixed the floor limit of Rs 25 lakh for the loan without any upper limit as it was targeting the product at high net worth individuals and NRIs. Besides, the borrowers would have to remain with the Bank for five years so that it discouraged speculators from exploiting low-cost finance for acquiring property.