When you take a loan, you take a responsibility to repay it too. And it may happen that you may struggle to repay the loan. The reason for non-repayment could be many, ranging from loss of job and improper financial planning to poor health, disability or even demise of the borrower. In extreme cases, you could end… Continue Reading
Home loans are offered at a spread over the benchmark. Typically, the benchmark is related to cost of funding for the bank. For instance, MCLR (Marginal Cost of Funds based lending rate) and Base Rate are based on cost of funding for the bank. The quantum of spread depends on multiple factors including quantum of loan, nature… Continue Reading
You have been planning to purchase a house. A completed property is quite expensive. For an under-construction property, you understand it will be difficult to manage both EMI and rent at the same time. You have heard about the concept of pre-EMI and full EMI, that are typically available for under-construction properties. You understand a Pre-EMI… Continue Reading
ICICI Bank has recently launched a scheme where new home loan borrowers will get 1% of EMI as cash back. Most of us would associate cash backs with credit card or online purchases. However, as banks try to find competitive advantage in relatively commodity like home loan market, cash back has found its way into plain… Continue Reading
I recently came across a news item that Tata Housing, a prominent realty company, has tied up with Indiabulls Home Finance to offer home loans at 3.99% p.a. The loan will offered by Indiabulls Housing Finance and the special interest rate of 3.99% p.a. applies for purchases in select projects from Tata Housing. As per the… Continue Reading
A home loan is a long term commitment. Therefore, if you are planning to take one to purchase a house, here are a few things you must keep in mind when you take a home loan. Focus on the Property First, and Then the Home Loan I am quite sure you can save a lot… Continue Reading
Axis Bank has a unique offering where the bank waives off your last 12 EMIs if you have maintained a good repayment record. Looks like a really good deal. Who wouldn’t like to save on 12 EMIs? You would, right? Why will a bank waive off the EMIs? Banks never do charity. Clearly, there is… Continue Reading
Ever since MCLR (Marginal Cost of funds based Lending Rate) came into existence from April 1, 2016, a question that I have been asked multiple times is “Should I switch from Base Rate to MCLR?” The frequency of these questions grew after various banks cut their MCLR sharply after the demonetisation drive. How Can I… Continue Reading
In this post, I will share an example where the bank did not pass the interest rate cut to the customer for a very long time. I found out about this case in an article in MoneyLife magazine. A gentleman took a floating rate loan from HDFC Bank in 2007. The loan was to be… Continue Reading
Young salaried employees are target customers for all the banks. Therefore, you can expect them to come with schemes to lure such prospects to their fold. The core idea behind such products is to offer such customers principal moratorium for a few years (since they may not be able to afford the full EMI). The… Continue Reading