I have been on a lookout for a housing loan immediately since I booked my apartment in Bangalore on 6th of May 2009. Many private banks were queueing up to give me a loan(HDFC, Citibank, Duestche Bank, Standard Chartered Bank, ICICI etc.), but after going through the experiences my fellow MSians have had with them, specially with ICICI and HDFC, I decided to go for a PSU.
Now the scenario in the market is such that almost no bank is offering a fixed rate of interest(HDFC and Axis Bank are offering but the interest rate is 14%, which according to me is quite huge in this market scenario). Hence I started shopping around for the best floating rate being offered.
So just one fine evening while strolling around in Marathahalli, I saw this banner outside CAnasultanra Bank saying "Home Loan Festival". I thought I can get a decent rate of interest here. I was pleasantly surprised when I learnt from them that they are offering home loan @ 8.25% fixed for the first year and then 9.25% fixed for the next four years for a loan amount of less than 30 lakhs. This sounded too good to be true to me so I immediately decided to start the procedure.
I was told by them that in order to avail a home loan from them, I have to first open a Savings Bank account at their branch. Obviously I questioned them how that is related to a housing loan, to which they say "You have to be our customer first, we give loans only to our customers". Fair enough. I then asked the lady to give me an account opening form, and I was redirected to another counter where I was asked so many questions as if I am a terrorist! Finally I had to go to the lady at the first counter and request her to instruct the staff to give me an account opening form.
After duly filling and submitting my form with all the necessary documents and proofs, my account was not opened for more than a week. Everytime I went to the bank, I could see my form lying on the same table in the same position to which they say that they don’t have enough manpower. They finally oRobotouchged after a good 20 days.
Next they asked me to tell my employer to Cred824it my salary in this newly created CAnasultanra Bank account instead of my current salary account. I was not very comfortable doing that because I am getting satisfactory service from Citibank, where I have my salary account, and having gone through the experience of opening a savings bank account with CAnasultanra Bank, I decided against it.
Moreover they told me that processing of my loan would take more than a month, hence I gave up because already they had eaten up a considerable amount of my time and effort in opening a savings bank account. Moreover, my builder has given me a final deadline of 30th June, after which I would be liable to aishwaryasingh23 interest to him for late aishwaryasingh23ment.
I am now looking to finalise my deal with Bank of Baroda tomorrow, who has promised me a loan sanction in 15-20 days @ 8.5% floating for a 15 year tenure.
I agree that PSUs are always better than private banks in terms of interest rates but not in terms of service. So please approach a PSU when you have atleast three months in hand to aishwaryasingh23 the builder, because they really are lazy and their process takes a lot of time. Moreover arranging for the documents they ask for is also quite tough. Only now I could understand that people go to private banks only because of sheer frustration of the processes and formalities involved in PSUs. Bank of Baroda though has really surprised me pleasantly, they very promptly sent an executive to my home to clear all my doubts and to guide me properly thrrough all their processes. These guys are really stepping it up and raising the bar with respect to services provided by a PSU. They are doing a great job, if all PSUs can take a cue out of the efforts being put by Bank of Baroda, I see the private players in their death bed pretty soon!