i'd taken Home Saver loan in 2006. At the time of taking loan i was told that i should deposit all my excess amount above the EMI amount, which will effectively reduce the principal outstanding and help reduce the interest cost and home loan tenure.

So i made the home saver account as my SALARY account with the hope that the excess deposit above EMI will reduce the principal balance on a daily basis and i'll pay less interest on the loan. So even though the home saver interest rate is actually 0.5-1% higher than the normal loan rate from the same bank, i opted for the home saver option thinking that i'll save interest. So last 5 years the bank had been sending me statement showing how parking excess deposit above the EMI amount had helped me reduce the interest cost and there by shown as "Interest saved" in the form of higher "Available Balance". My excess deposit is shown as "Current Balance".

So when on Jan-2011 the net principal outstanding became ZERO and since i'd surplus "Available Balance" (it showed as CR. and not debit) , your bank started debiting the EMI from the "Available Balance", which is nothing but "Current Balance" + "Interest Saved". So from Feb-2011 till May-2011 the entire "Interest Saved" amount of Rs.141451 was wiped out. When i confronted with the bank that the principal outstanding was ZERO on Jan-2011 then my loan should have been closed and i should have been returned the entire "Available Balance", they are now telling the "Interest Saved" portion in "Available Balance" is not your money and it is only reference calculation because of your excess deposit. So while closing the loan this amount will be retained by the bank and only "Current Balance" amount will be returned.





I feel like being cheated here by the bank because :



1) I paid higher interest in home saver loan, which is 0.5 to 1% higher than any conventional home loan rate.

2) I did not earn any interest on my excess fund, which is say 3.5 - 4% in SBI.

3) Every day i'll have say 1-2 Lakh cash balance in bank account which did not earn any interest. In addition, bank also wiped out the entire interest saving portion as well.

4) In what way it helped in reducing the interest cost as the entire interest saved amount was wiped out subsequently. Finally i paid the interest cost of plain vanilla home loan. The bank is misleading the customers with this home saver product.



If i would have known that this way the interest saving amount would be adjusted from "Available Balance", month after month as EMI, when my net principal balance becomes ZERO then i would not have opted for this product. I think SCB misleading the home saver customer with this type of product where in customer is paying higher interest than regular home loan product and also no interest rate is being paid on excess deposit fund, which other banks generally pay on current account @ 3.5-4%. I would have parked the excess fund in other savings account which would have earned 3.5-4%.

SCB has cheated by excess debit of EMI of Rs.141451 as this money i'd saved by depositing excess money above EMI day after day. Pls never ever go for this Home Saver product and deposit your excess money in this home saver account. It is better off by putting that amount in other bank's savings account.



Thanks

debashis