On November 01, 2008, I received a letter dated 15-October 2008, whereby the bank informs me of an increase in the home loan interest rates.
I am surprised to receive their letter of an increase in home loan interest rates, especially when every other bank is mulling over decreasing interest rates. As aware, banks such as PNB and IDBI have already decreased their home loan interest rates in late October to early November 2008. Moreover, their increase in interest rates is unexplainable when RBI is reducing CRR and Repo Rates sequentially. Further, when I compare the interest rates of Kotak’s bank with other banks, they are on the higher side.
Substantial increase in EMI only makes borrowers like me more vulnerable in the current financial crisis environment. Such an increase will not increase the default rate but also force some of us to consider switching to some other bank.
A sincere advice to new & existing borrowers. Please do consider your decision of staying with Kotak.