HDFC launches new fixed rate home loan

With the new product, a customer can avail a home loan at an interest rate that remains fixed for a duration of 2 years to 10 years and thereafter the loan switches automatically to HDFC's adjustable rate home loan (ARHL)


Mortgage lender HDFC launched a fixed interest rate home loan product for a limited period as part of New Year celebrations to attract customers. 
Besides, the housing finance company also slashed its deposit rates by up to 15 basis points across various products and options. 
Under TRUFIXED product, the customer can avail a home loan at a fixed interest rate for the duration of 2 years to 10 years and thereafter, the loan will switch automatically to HDFC's adjustable rate home loan (ARHL) product without any charges, the company said in a statement. 
Earlier this month, Axis Bank had launched a 20-year home loan scheme at a fixed rate of 10.40% for loans of up to Rs50 lakh. 
As per HDFC, the options are in addition to all existing home loan products being offered by the housing finance company. 
These options are for customers seeking to lock in their home loan interest rates and not take risk on interest rates for a period of as long as 10 years, it said. 
The interest rates for 2 and 3 years option range between 10.15% and 10.35% and for 10 years between 10.25% and 10.50% per annum. 
This offer shall be applicable to all customers who apply between 22 December 2014 and 31 January 2015 and avail of the first disbursement on or before 31 March 2015. 
After the completion of the fixed rate period, the loan will switch to floating rate, linked to benchmark rate. 
The floating rates on the switch to ARHL based on current benchmark for loans up to Rs75 lakh is 10.15% and for loans above Rs75 lakh is 10.50%. 
Non-residents and People of Indian Origin (PIOs) can also avail of this option.


Global market trends

NASDAQ Composite and S&P 500 fell 1% each, while Shanghai Composite advanced 4%. Nikkei and the FTSE declined 4% each.



Tata Group returns to the Airline space, which it helped take birth

The launch of new airline Vistara, will be a proud day for the Tata group, which pioneered the airline experience, more than 60 years ago


After having obtained the Air Operating Permit (AOP), Vistara have announced that their inaugural flight from Mumbai to Ahmedabad will take place on 9th January 2015, with two narrow-body Airbus A 320 planes and they plan to reach a fleet of 5 aircraft by March, 2015. New Delhi is confirmed as their hub, and full route details are expected to be announced shortly.
This will be a proud day for the Tata group, which pioneered the airline experience, more than 60 years ago. Tatas' venture was taken over by the Government of India to form Air India International.
Vistara will be able to carry a full load of 148 passengers on their flights in A 320-200s and they are expected to offer business, premium and economy classes.  The premium segment will have more leg space and a baggage allowance of 20 kgs as against 15 kgs in economy class. As a full service carrier, they will cater to the needs of the exacting traveller and hope to offer an unforgettable experience on their flights. Vistara will be offering a frequent-flyer programme too, but that would be directly related to the money spent and not the miles covered.
It may be recalled that Ashok Gajapathi Raju, the Civil Aviation Minister had very clearly spoken against the 5/20 rule, which stipulates that a domestic carrier must have completed 5 years of service and have a fleet of 20 aircraft before being allowed to fly overseas.  He had said that such a "rule does not exist anywhere in the world.”  Kingfisher has been grounded and SpiceJet is having a series of problems. There have been heavy cancellations of flights in the case of SpiceJet, which is causing inconvenience to the travelling public. Hence, the government is considering doing away with the 5/20 rule. Meantime, travellers are being forced to pay higher fares and other carriers are now overloaded with passengers.
In the likely event that the 5/20 rule is scrapped, chances are that Vistara may be able to bring in wide body planes which will have a greater number of seats to offer. The flights will cover longer distances with the flight range covering 14-15 hours, non-stop.   
At the moment, Vistara's chief executive officer, Phee Teik Yeoh, is hoping to increase its fleet to 20 aircraft in 4 years' time.  But, if the government were to withdraw the 5/20 rule, they may have to revise their plans and work out a strategy to meet the changed circumstances. 
(AK Ramdas has worked with the Engineering Export Promotion Council of the ministry of commerce. He was also associated with various committees of the Council. His international career took him to places like Beirut, Kuwait and Dubai at a time when these were small trading outposts; and later to the US.)



Suketu Shah

3 years ago

The way Tata companies are run nowadays with the exception of TCS is a joke.Check their performances in the last 1 -2 yrs esp after Cyrus Mistry has taken charge and it speaks for itself.

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