Despite RBI guidelines, why Syndicate Bank is charging foreclosure charges

[samkapoor77]

In 2008, I took home loan on floating rate of interest from Syndicate Bank. But now I am interested in transferring it to SBI max gain. As per the loan agreement with Syndicate Bank, I need to pay them 1% as foreclosure charges on transferring my loan to any other bank. But as per RBI guidelines, pre-payment charges have been abolished. Is this provision of RBI provision not applicable on transfer of loan?

[samkapoor77]

Foreclosure charges are still applicable on loans with fixed rate of interest. For loans with floating rate, it has been abolished.

[Author]

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