Glossary
Prepayment or Foreclosure Charge
What it means
RBI directions prohibit prepayment charges on floating-rate loans to individuals for non-business purposes, which covers most home loans and many loans against property. Fixed-rate loans and loans to firms and companies may carry charges of 2% to 5% of the amount prepaid.
Charges usually reduce after the first year or two. The Key Fact Statement must state them clearly; compare them alongside the rate when choosing a lender.
Where it applies
Personal Loan
Collateral-free personal loans from ₹50,000 to ₹50 lakh at rates starting around 10.25% p.a., with disbursal typically within 48 hours of approval.
- Rate from
- 10.25% p.a.
- Up to
- ₹50 L
Car Loan
New car loans covering up to 100% of on-road price at rates from about 8.5% p.a., with tenures up to 7 years, across banks and captive finance companies.
- Rate from
- 8.50% p.a.
- Up to
- ₹2 Cr
Business Loan
Unsecured business loans from ₹2 lakh to ₹1 crore for proprietors, partnerships and companies, at rates from about 14% p.a., with tenures up to 5 years and minimal collateral requirements.
- Rate from
- 14.00% p.a.
- Up to
- ₹1 Cr
More terms
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