Home Loan Provider in India is normally finalized based on the reference or word of mouth. There is no harm in taking references or feedback from friends and family members. It helps in better decision-making. In most of the cases, it is the builder who decides Home Loan Provider of a buyer. He has vested interest in this entire process as builder receive cut or commission to promote particular Home Loan Provider. Secondly, he doesn't want you to initiate Title Search or Legal Check Process again. Some of the common tactics of the builder to pressurize buyer are Documentation, Payment ... Read More
Impact of Base Rate Cut on Home Loans
Impact of Base Rate Cut on Home Loans is the hot topic these days. RBI surprised twice by out of cycle Repo Rate cuts of 25 basis points each or 0.25%, Banks were reluctant to cut Base Rate. Despite the public displeasure of both RBI and the Govt, Banks stood firm on their stand. As i highlighted in my post that RBI is King without Kingdom, a very little can be done by RBI in this regard. Rather i will say, its a cartelization similar to that of Telecom and Airline Companies. Only 2 banks i.e. Union Bank of India and United Bank of India cut the base rate to benefit customers. As these banks ... Read More
5 Golden Rules of Home Loan EMI
Home Loan EMI is an important part of borrower's life till Home Loan is closed. Entire family think, eat, drink and sleep Home Loan EMI. I mean to say, all imp decisions of family revolve around this income "guzzler". As home loan is long term commitment therefore we come across various situations and turning points where we don't know how to handle Home Loan EMI. Any mishandling can have long term financial implications. In this post on "5 Golden Rules of Home Loan EMI", we will discuss 5 such imp rules which should be guiding light to decide. Rules for Home Loan EMI 1. Home Loan EMI as a ... Read More
How to find out Right Home Loan Amount?
What is Right Home Loan Amount?. There is no right or wrong answer to this question. Both under borrowing and over borrowing are dangerous for financial health of an individual. We cannot ignore this question because it directly impacts your interest outflow. Three important pillars of Home Loan are Monthly EMI, Home Loan Tenure and Home Loan Amount. All 3 are interlinked to each other. I have not included Interest Rate as Interest Rate is not in control of a Borrower and is fixed. EMI, Tenure and Home Loan Amount are variable and optimum mix can be calculated. To influence any of these, ... Read More
Composite Loan – Two in One Home Loan
Composite Loan is a mix of Land Loan and Construction Loan. It is not very popular jargon in Indian Mortgage Industry. One of the reason is scarcity of land in big cities i.e. buyer prefer flats in big cities. The concept of independent house or villas is more relevant in small cities due to availability of land. As i promised in my last post that next post will be dedicated to composite loan. Yesterday i visited one of the leading PSU Home Loan provider to get some clarity on Composite Loan. Whole branch took 45 mins to understand what is Composite Loan. Loan Manager of the branch called ... Read More
7 Facts You Should Know About Land Loan
Land Loan or Plot Loan (used interchangeably) is one of the most confusing subject for borrowers in Loan / Mortgage segment. Confusion is normally between Home Loan, Land Loan and Composite Loan. All three are different products with different features, benefits, Terms and Conditions. Unfortunately all three i.e. Home Loan, Land Loan and Composite Loan are loosely referred as Home Loan only. At macro level, Land Loan is sanctioned only for purchase of residential plot or piece of land. Composite Loan is Land Loan + Construction Loan i.e. to complete construction on plot. In most of the cases, ... Read More
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