Mumbai, Maharashtra -- (SBWIRE) -- 06/21/2010 -- Home loans have come a long way since its introduction and so has the interest rates. Interest rates were offered at around 7% in early 2000. Today banks charge a whooping double figure interest rate from home loan borrowers. The scenario is even more difficult for people who have opted for floating rate of interest. Floating rate of interest is offered to new borrowers at a very low rate lower than the present fixed rate of interest. However, floating rate of interest offered lower initially can be hiked anytime with regards to changing market scenarios.

Borrowers aware about the interest rate fluctuations in floating types would rather opt for fixed rate of interest. However few borrowers are lured towards initial low offering of the floating interest rate. Even fixed rate of interest for most lenders is fixed for initial pre-mentioned period after which the rate of interest becomes floating.

Rupeetalk.com contains articles, guides, tips, FAQs on home loan which help users understand home loan as a process and the intricacies attached to it. The articles are extremely useful in explaining users’ interest rate complexities and what factors are to be considered before choosing it type. Users can use the EMI calculator to calculate monthly EMIs with respect to interest rates.

It is important to understand interest rate complexities before choosing one for your home loan. Floating rate of interest opted because it is offered lower initially is actually a debatable decision. Floating rates are directly related to banks prime lending rate which is subject to change with changing market conditions. Thus for instance a floating rate offered at 8% initially has the capacity to touch 14% within few years. Thus this would increase monthly EMIs drastically and also result in increased tenure. A fixed rate of interest for most banks is fixed only during initial tenure after which it is as good as floating rate of interest. Thus when opting for a fixed rate of interest it is indispensable for a borrower to read offer document meticulously to understand the precise offering of fixed rate of interest.

Thus among the common trends adopted by lenders is to offer borrowers a very low interest rate initially in either cases (fixed or floating) and increase it gradually with time giving no option to the borrower whatsoever.

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