Loan
Rate Reset
Also known as: Rate Revision, Interest Rate Adjustment
Periodic adjustment of loan interest rates based on changes in the underlying benchmark rate.
Detailed Explanation
Rate Reset refers to the mechanism by which variable rate loans adjust to changes in benchmark rates. For MCLR-linked loans, reset happens annually on the loan anniversary date. For external benchmark loans (RLLR/EBLR), reset is typically monthly or quarterly. The reset frequency is mentioned in your loan agreement. Understanding reset mechanisms helps borrowers anticipate EMI changes and plan finances accordingly.