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Are you looking for ways to reduce your home loan interest while keeping financial flexibility at your fingertips? HDFC’s home loan overdraft facility might be just what you need! This unique feature enables you to lower your interest burden without locking away your funds. Here’s everything you need to know to make an informed choice.
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What is an HDFC Home Loan Overdraft Facility?
In simple terms, the HDFC home loan overdraft facility lets you turn your home loan into an overdraft account. By depositing extra funds into this account, you can reduce your outstanding principal, lowering your interest payments over time. But here’s the best part—you can withdraw these extra funds anytime, giving you the flexibility of a savings account along with the benefits of a loan.
Think of it as a tool that adapts to your financial needs: when you have extra funds, deposit them to save on interest.
When you need cash, withdraw from the account to meet your expenses.
Key Features of the HDFC Home Loan Overdraft Facility
| Feature | Description |
|---|---|
| Interest Rate | Charged only on the utilized amount, helping you save on interest whenever you deposit surplus funds. |
| Loan Amount | From ₹50,000 – ₹10 lakh |
| Collateral/Security | Not required, making it easier to get started. |
| Loan Amount Eligibility | Loan amount eligibility varies. MSMEs with over 6 years in business may qualify for up to ₹10 lakh. |
Benefits of HDFC Home Loan Overdraft Facility
Reduced Interest Burden
By depositing any surplus funds, you reduce your principal balance, effectively lowering your interest payments. This is ideal for those looking to save more in the long run.
Financial Flexibility
Unlike a fixed EMI schedule, the overdraft facility gives you the freedom to withdraw funds whenever you need them. This flexibility can be especially helpful during emergencies or unexpected expenses.
Convenient Management
Managing your home loan becomes simpler since you can use the overdraft facility as both a repayment tool and a savings vehicle. It’s like having two accounts rolled into one!
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HDFC Home Loan Overdraft Facility Charges
Like any loan feature, the HDFC home loan overdraft comes with certain charges.
Here’s what to keep in mind:
| Charge Type | Amount |
|---|---|
| Processing Fee | Up to 1% of the loan amount, subject to a minimum fee |
| Interest Rate | Linked to HDFC’s RPLR (Retail Prime Lending Rate) |
| Overdraft Maintenance Fee | As per HDFC’s terms and conditions |
HDFC Overdraft Calculator: Estimate Your Potential Savings
To effectively manage your finances, Credit Dharma provides an overdraft calculator. This tool helps you estimate the potential interest savings and benefits of converting your home loan into an overdraft account.
Wondering how much you could save by using the overdraft facility? Our home loan overdraft calculator can help!
By entering your current loan amount and any extra funds you plan to deposit, you’ll instantly see your reduced interest burden and the new effective loan amount.
- Input Loan Amount: Enter your current loan amount.
- Input Surplus Deposits: Type in any extra funds you’re able to deposit into the overdraft account.
- Calculate Savings: The calculator will show your reduced interest charges and new effective loan amount.
This simple tool is here to guide you on your journey to savings—try it today!
Save Lakhs on Your Home Loan with HDFC’s Overdraft Facility
Conclusion
The HDFC home loan overdraft facility offers a unique blend of interest savings and financial flexibility. By understanding how this facility works and its benefits, you can make an informed decision about whether it’s the right option for you. Always consider your financial situation and consult with HDFC to explore this feature further.
Credit Dharma offers the best home loan options with competitive interest rates, helping you save more. With expert advice, they guide you through the process to make the most of your home loan.
Frequently Asked Questions
Yes, HDFC offers an overdraft facility for home loans, allowing borrowers to deposit surplus funds to reduce the outstanding principal and save on interest.
An overdraft facility in a home loan allows borrowers to convert their home loan account into an overdraft account, enabling them to deposit and withdraw surplus funds, thereby reducing the interest burden.
Taking an overdraft on a home loan can be beneficial for managing irregular cash flows and saving on interest costs, but it should be used wisely to avoid financial mismanagement.
The overdraft interest rate in HDFC is linked to the Retail Prime Lending Rate (RPLR) and can vary based on the loan agreement and market conditions. Check with HDFC for the most current rates.
HDFC Bank’s Dukandar Overdraft Facility provides an overdraft limit ranging from ₹50,000 to ₹10 lakhs, offering flexibility for business needs. It ensures easy access to funds to manage cash flow efficiently.
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