CIBIL Score and Credit Card Limit

Credit Card Limit

Credit Card Limit is basically "Spending Limit" allowed on your credit card. Credit Card is riskiest business for any bank. The default rate is very high on credit cards as it is totally unsecured credit extended to customer. Now a days banks are extra cautious while issuing a credit card. A credit card is issued only after due diligence. Every credit card has different credit limit depending on risk profile of the customer. Credit card limit is decided based on income, current loan portfolio, expense pattern and overall risk assessment of customer by the bank. Banks pull out CIBIL report of a customer to check most of these point. If CIBIL sore is less than 750 or there is a default on payment in past then Credit Card application is not be approved. Basically CIBIL score is a credit report card of a customer i.e. how he manages his personal finance and credit discipline followed by the customer. Credit Card Limit and CIBIL Score When the credit card is issued, banks play safe and … [Read more...]

Stock Market Tips – Business of Selling Dreams

Stock Market Tips

Stock Market Tips is one of the most sought after business by intelligent fraudsters because of low investment & very high returns. My clients / Readers seek stock market tips from my end but believe me that no one can predict movement of stock market. In this regard, i like famous quote of Abraham Lincoln "You can fool all the people some of the time, and some of the people all the time, but you cannot fool all the people all the time" . The so called Stock Market Gurus are raking in the moolah from stock market tips. Trust me anyone can make big money from Stock Market Tips business. Its a risk free, low cost & high return business which we will discuss in this post. Besides Stock Market Experts, we also have so called Financial Planners who also don't know anything but they just flow with the tide. This class of Stock Market Tips provider become active when stock market is doing good & they simply vanish during Bear phase. I never suggest my readers to invest directly in … [Read more...]

Checklist of Property Documents

Property Document

Checklist of Property documents is very crucial step of property purchase process. Property transaction in India is document intensive exercise because of complex legal, statutory and regulatory framework. Based on queries received from my clients, i can conclude that approx 80% buyers don't get complete property documents at the time of purchase. These buyers struggle at the time of sale of property. Another problem linked to property documents is that buyer or a seller is not aware why specific property document is required, whether it is required in original or not etc. To help readers of my blog, i have created a comprehensive checklist of property documents. I will keep updating this property documents list as and when required. Also i would like to add that some states in India require additional property documents which vary from case to case basis. 1. Sale Deed/Title deed /Mother deed/Conveyance Deed Description of Property Document: A sale deed acts as the main legal … [Read more...]

Capital Gain Tax – Long Term Capital Gain

Capital Gain

In my previous post on Capital Gain Tax - Short Term Capital Gain we discussed capital gain tax in detail. We also discussed how short term capital gain tax is calculated. Before going through this post, I would request you to go through my previous post. This post is continuation of previous post Capital Gain Tax - Short Term Capital Gain. In this post we will discuss Long Term Capital Gain and why it is so critical from Income Tax Perspective. Just to recap, If the capital asset is held by an individual for a period more than min Holding Period as specified for each capital asset then Gain / Loss from such capital asset is termed as Long Term Capital Gain. To understand the concept of Long Term Capital Gain, first we will discuss Inflation and Inflation Indexation. Inflation As per Wikipedia, Inflation is a sustained increase in the general price level of goods and services in the economy over a period of time. In layman terms, if a particular set of goods and services cost Rs … [Read more...]

How to select an Affordable Housing Project?

affordable housing project

In my previous post on Affordable Housing - A Myth or Reality, I discussed the nitty gritty of Affordable Housing which is a new buzz word in the reality market. Today while going through property section of a newspaper, I observed that although a majority of the ongoing projects are positioned as Affordable Housing Projects, only a handful are indeed so in true sense. It does not cost anything for a builder to tag a project as Affordable Housing Project. Low cost housing is often referred to as Affordable Housing Project by small builders which we will discuss in detail in this post. As a buyer, you can easily make out whether the builder is serious about this concept or not. Seriousness reminds me of one of the very well-known real estate company Puravankara Projects Limited created a separate subsidiary “Provident Housing Limited” to focus on Affordable Housing. As we know that one shoe doesn't fit all, the same holds true for Affordable Housing. It requires a different kind of … [Read more...]

Capital Gain Tax – Short Term Capital Gain

Capital Gain tax

Capital Gain Tax is least understood but most discussed topic. Capital Gain Tax is a vast topic. If i will cover both Short Term Capital Gain Tax and Long Term Capital Gain Tax in a single post then it will be injustice. Indian Tax system is very complex & it is equally difficult to explain it in a simplified manner. In this post, we will cover Short Term Capital Gain Tax and next post will be dedicated to Long Term Capital Gain Tax. To start with basics, lets understand what is Capital Gain. Capital Gain means the profit earned from the sale of Capital Assets like Property, Shares etc. Though it is referred as Capital Gain but not necessary that you always book Capital Gain from sale of Capital Assets. If you incur loss from sale of Capital Assets then it is referred as Capital Loss. For taxation purpose, Capital Gain / Capital Loss can be further classified as Short Term Capital Gain Tax / Loss or Long Term Capital Gain Tax / Loss depending on the Holding Period of a Capital … [Read more...]

Home Loan Prepayment – 5 Important Points

Home Loan Prepayment

Home Loan Prepayment is financially beneficial for Home Loan Borrowers. It helps to reduce Interest burden thus overall cost of property. Any type of debt including Home Loan is not good for financial health of an individual. Average Home Loan tenure in India is 8 years which means Home Loan Prepayment is preferred by borrowers to clear off Home Loan. Normally Home Loan Prepayment is done when we receive annual bonus or any exiting investment mature. As i mentioned in my other posts also that Home Loan Interest increase the overall cost of property. Assuming, your current Home Loan ROI is 10% and you have availed 80% of property value as Home Loan. In present scenario, average appreciation in property value is 5%. Infact in few cities, there is a drop in property prices during last 1 year. Effectively your property value is depreciating by approx 3% on yearly basis if it is on Home Loan. I have also explained these points in detail in my post 5 Disadvantages of Home Loan. To summarize, … [Read more...]

Beware of Hidden ULIP Charges

ULIP Charges

ULIP Charges and Greed are synonyms for each other. ULIP (Unit Linked Plan) is a perfect case study of How Greed Kills. Greed is always both ways i.e. Banks/Insurance Provider's greed to sell more and Greed of investor for higher returns. ULIP was launched in 1971 but all the mess in ULIP started after private life insurers entered in 2000. ULIP misselling became so rampant that  IRDA (Insurance Regulatory and Development Authority) had to step in. IRDA came up with regulations for ULIP to control ULIP charges in September 2010. I still remember that for few ULIP products, large portion of first few years premium was booked only towards ULIP charges i.e. investor was left with negligible fund value.  This was day light robbery. Reason for all this mess was very high commission offered by insurance providers to insurance agents for ULIP. Agents promised that investment will be doubled in 3-5 years time. At one time between 2005-2008, only investment option visible in the market was … [Read more...]

Make in India – Key to Revival of Economy

make in india

Make in India campaign was launched by Prime Minister Sh. Narendra Modi on Sep 25, 2014. The key objective of Make in India campaign is to invite businesses not only in India but across the world to invest & manufacture in India. The purpose of Make in India campaign is (a) Job Creation (b) Economic Development (c) Global Recognition Indian economy is going through bad phase. In past, i wrote an article on Why India is heading towards Recession. Clouds of recession are still looming large. Current euphoria is because of election of Mr Modi and stable Govt in India. Sweeping economic reforms are need of hours to pull back economy from clutches of Recession. It is commendable that in such a short span, Modi Government has identified the reasons why economy is in bad shape. At the same time Govt has taken right steps to bring Indian economy back on track.  Make in India campaign is Right Step in Right Direction. Make in India is recognized globally and has featured in "100 … [Read more...]

Should i invest in Kisan Vikas Patra ?

Kisan Vikas Patra

Kisan Vikas Patra was initially launched in the year 1988. Kisan Vikas Patra was one of the most popular and successful small savings scheme in India till it was withdrawn in 2011. The reason for withdrawal was laundering of Black money through this small savings scheme. "Double your Money in 5 and a half year" was USP of Kisan Vikas Patra during 90's. The investment discussion between my parents revolved around only 3 saving schemes i.e. NSC (National Savings Certificate), PPF (Public Provident Fund) or Kisan Vikas Patra. To be honest, not many options were available during those days. When i was a kid, i used to think that only a Farmer can invest in Kisan Vikas Patra then how come my parents are investing in this instrument. Kisan Vikas Patra was re-launched recently and i was feeling quite nostalgic. In its new avatar, Kisan Vikas Patra will double the money in 100 months i.e. 8 year and 4 months which means effective Rate of Interest is 8.7%. The key objectives of Govt to … [Read more...]