LIC HOUSING FINANCE
Steep rise in interest rate

Dear Sir,

I have taken a 15 year loan from LIC Hsng Finance in Jan for Rs 27, 00, 000. I was told by their representative Ms Hemlata Suvarna that since yours is an exhibition case, you will be eligible for a concessional rate of interest of 9.25% for a floating rate. However, in Aug I got a letter from LIC Hsng that the rates have been increased to 10.75% and my number of EMI's will go up from 180 to around 250. I wanted to ask that can a housing finance company increase rates in shot by 150 basis points for a customer who was promised a concessional rate? If their PLR had increased by 25 basis points, I should have been charged 9.50% and not 10.75%. What was the point in alluring me with a concessional rate initially and then jacking it up so steeply.

Regards

Mitish Somani