Last week, 3 Big Hoardings caught my attention "NO EMI For 24 Months", "Book Your Dream Home at Just 8% Interest Rate" and "Book Now Pay Later". It seems to be some divine intervention which is helping / supporting me to fulfill my dream of owning a flat. "HOLD ON" signals my mind to my heart. Remember the Golden Rule of Finance "There are No Free Lunches in this World". This divine intervention is named as "Subvention Scheme". Word Subvention is derived from Latin word "Subventus". It means Monetary Help or Support. Subvention Schemes were banned by RBI on 3rd September, 2013. These schemes ... Read More
Unbreakable Bank Fixed Deposit
Unbreakable Bank Fixed Deposit as the name suggests cannot be withdrawn prematurely. In other words, people cannot break their bank fixed deposit before the end of maturity period. Reserve Bank of India has allowed the banks to offer Unbreakable Bank Fixed Deposit at higher interest rate. It will provide an option to earn higher interest to people who don't need funds for certain period. Unbreakable Bank Fixed Deposit is not a new concept. It is being borrowed from more mature markets. In India, Fixed Deposit means fixed interest rate but actually it is term deposit i.e. deposit for fixed term ... Read More
How Real Estate Sector is Highly Profitable?
Real Estate Sector is in bad Shape or Real Estate Sector is under huge debt. You might come across these news paper headlines on regular basis. You must be feeling very pity for people in Real Estate Sector. I do agree that Real Estate agents or Real Estate brokers are struggling to survive but story is completely different on other side. Yes, i am talking about Promoters, Builders or Investors of Real Estate Projects. Recently i met senior executive of very reputed builder in Mumbai. Privately he admitted that Profit margins of any project is between 15% to 20%. Surprisingly the margins of ... Read More
Pay High Interest for Higher Loan to Value Ratio
Indian Home Loan Market is gradually maturing. Sometime back a very imp news which went unnoticed was regarding setting up of India Mortgage Guarantee Company (IMGC). India Mortgage Guarantee Company is promoted by IMF, AIG and NHB (National Housing Bank) which in turn is wholly owned subsidiary of Reserve Bank of India (RBI). All HFC's (Housing Finance Companies) have to register with NHB before starting Housing Finance Business. Now you must be wondering why i am sharing this background and as a borrower how will i benefit from setting up of India Mortgage Guarantee Company. Lets check it ... Read More
Affordable Housing – A Myth or Reality
Affordable Housing is new buzz word in Real Estate market. Currently Real Estate sector is going through difficult times as the economy is still in bad shape and interest rates are high. Job loss is still a reality and it will take atleast 2-3 years to bring the economy back on track. Real Estate inventory has piled upto alarming levels in major cities. Currently banks lend at 14%-16% to builders which further increase the cost of property. In order to boost demand recently RBI revised the definition of Affordable Housing to benefit borrowers. Affordable housing is clubbed with infrastructure ... Read More
Withdrawal of Pre-2005 Notes : Master Stroke by RBI
Recently RBI said that all the Pre-2005 Notes will be withdrawn from circulation. Though RBI said that the objective of this exercise is to crackdown on counterfeit notes in circulation. RBI will replace Pre-2005 notes with New Currency Notes (With Enhanced Security Features). In my opinion, Crackdown on counterfeit currency in only one of the reason for this move. There is larger motive behind this Master Stroke. Lets understand how In India, till date no study is being done to find out the average life of Paper Currency Note. In response to RTI queries regarding average life of Paper ... Read More