Can hdfc charge 2% prepayment charges for home loan even if loan prepayment is done by my employer?



I have taken home loan (Rs,2250000) from HDFC in 2008. Now i can repay the whole principal balance through my employer.But hdfc is saying that they will charge 2% as perpayment charges.As per my i understanding they should not charge it as i am not repaying it through any financial institution. Can any body throw some light on it?

2 Replies to “Can hdfc charge 2% prepayment charges for home loan even if loan prepayment is done by my employer?”

  1. Ashok, you need to look at loan contract again. It probably had a pre-payment clause in it applicable for the first 5 years of the loan, possibly on a declining sliding scale. The fact that someone else is paying off that loan has no affect what-so-ever.


  2. Any prepayment in HDFC before 5 years they will charge 2% prepayment penalty. They don’t bother whether it comes from the party or from the party’s employer.

    They ask the applicant to sign the loan agreement, generally it runs into several pages and it is impossible for a person to read and understand in minutes. But applicant has to sign all papers before release of First Installment. So you got to pay the 2% prepayment penalty.





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