Talks are on everywhere with regulators wanting to do away with prepayment penalty being levied on home loan borrowers for floating rate loans.

Lenders have however showed their dissatisfaction in this regard. Chairman of housing finance major, HDFC, Mr Deepak Parekh has said that with total waiver in prepayment penalty being imposed, serious implications can come up the way of lenders.

"If our lenders are charging us pre-payment charges, why are we not allowed to charge pre-payment charges? If one bank doesn't, every bank will have to. This is our source of income. We want to do more work in the future... looking forward rather than trying to protect your book, rather to control your book and rather than keep your customers within your ambit. I don't think it is a good sign," he said.

"Certainly this (greater substitutional housing finance) was not what one wants for the system," he added.