Banks must link disbursal of housing loans to construction stages: RBI

Taking serious note of borrower un-friendly home loan schemes introduced by banks in association with developers/builders, RBI has advised banks to refrain from making upfront disbursal of home loans to the builders without linking the disbursal to various construction stages of housing project. These subvention schemes, popularly known as 80:20 or 75:25 schemes, had gathered… Continue Reading

Understanding tax benefits on home loan

Please read our updated article explaining tax benefits on home loan. The hardest thing to understand in the world is the income tax – Albert Einstein Most people would tend to agree with Einstein, as tax related calculations & rules are complex, intimidating and difficult to understand. At the same time, it is imperative to… Continue Reading

EMI Option – Boon or Bane

Do you know the story of Bhasmasura? In Hindu mythology Bhasmasura was a demon who got a boon from Lord Shiva that anyone he touches with his right hand should turn into ashes. Once he got this boon, Bhasmasura wanted to try it on Lord Shiva himself. On seeing the plight of Shiva, Lord Vishnu… Continue Reading

SBI and ICICI Bank end pre-payment penalty on home loans

A few weeks ago, NHB had banned prepayment penalty on floating rate home loans by HFCs such as HDFC and LIC Housing Finance. Just like we had predicted earlier, banks are now following suit in abolishing prepayment penalty on home loans. SBI and ICICI Bank have now joined the HFCs and Axis Bank in ending… Continue Reading

Cap for 1% interest subsidy raised – Should we cheer?

Recently, Union Cabinet has decided to increase the cap for availing 1% subsidy on home loans. For poor and middle class people to whom owning a house is a big dream, it will be a relief as it will partially compensate for the ever increasing interest rates. The subsidy would now be available for home… Continue Reading