With SBI reducing their Home loan interest rates to 8% & LIC Housing finance to 8.75%, most of the borrowers are now switching their home loans to these banks. To dissuade customers from moving to other banks HDFC has now increased the fee for switching over the loan from 2% to 3%.This prepayment fee is levied if the borrower wants to close the existing loan by transferring the loan to another Bank. This fee is levied only for their new borrowers. So borrowers who had taken a home loan before this news and if they plan to switch over their loan they will not be charged this new fee. Whatever mentioned in the agreement that amount will be applicable.