Posts Tagged interest rate
July 16, 2011 at 9:40 am · Filed under Finance, Growth Investing, India Real Estate, Indian Properties, Indian Real Estate, Investing, Loans, Marketing, Properties, Prospecting, Real esate, Real estate trends, Reality Firms, Residential Property ·Tagged Allahabad Bank, Andhra Bank Limited, Axis Bank Limited, bank, Bank of Baroda, Bank of India, Canara Bank Limited, Corporation Bank, Dena Bank Limited, Dhanlaxmi Bank Limited, HDFC Bank Limited, home loan, ICICI Bank Limited, IDBI Bank Limited, Indian Bank, Indian Overseas Bank Limited, indian property, Indian Real Estate, IndusInd Bank Limited, ING Vysya Bank Limited, interest rate, Kotak Mahindra Bank Limited, Oriental Bank of Commerce, Punjab and Sind Bank, Punjab National Bank, residential property, State Bank of Bikaner and Jaipur, State Bank of Hyderabad, State Bank of India, State Bank of Mysore, Union Bank of India
| Banks |
Rate of Interest |
| Allahabad Bank |
Base Rate to 10.25% and Benchmark Prime Lending Rate to 14.50% |
| Andhra Bank Limited |
Base Rate to 10.25% and Benchmark Prime Lending Rate to 14.50% |
| Axis Bank Limited |
Base Rate to 9.75% and Benchmark Prime Lending Rate to 17.50% |
| Bank of Baroda |
Base Rate to 10.25% and Benchmark Prime Lending Rate to 14.50% |
| Bank of India |
Base Rate to 10.25% and Benchmark Prime Lending Rate to 14.50% |
| Canara Bank Limited |
Base Rate to 10.25% and Benchmark Prime Lending Rate to 14.50% |
| Corporation Bank |
Base Rate to 10.25% and Benchmark Prime Lending Rate to 14.50% |
| Dena Bank Limited |
Base Rate to 10.20% and Floating Reference Rate to 15.25% |
| Dhanlaxmi Bank Limited |
Base Rate to 10.25% and Benchmark Prime Lending Rate to 19.25% |
| HDFC Bank Limited |
Base Rate to 9.50% and Benchmark Prime Lending Rate to 18.00% |
| ICICI Bank Limited |
Base Rate to 9.50% and Floating Reference Rate to 15.25% |
| IDBI Bank Limited |
Base Rate to 10.00% and Benchmark Prime Lending Rate to 14.50% |
| Indian Bank |
Base Rate to 10.25% and Benchmark Prime Lending Rate to 14.50% |
| Indian Overseas Bank Limited |
Base Rate to 10.25% and Benchmark Prime Lending Rate to 14.50% |
| IndusInd Bank Limited |
Base Rate to 10.00% and Benchmark Prime Lending Rate to 18.00% |
| ING Vysya Bank Limited |
Base Rate to 9.70% and Benchmark Prime Lending Rate to 18.25% |
| Kotak Mahindra Bank Limited |
Base Rate to 9.50% and Benchmark Prime Lending Rate to 18.25% |
| Oriental Bank of Commerce |
Base Rate to 10.25% and Benchmark Prime Lending Rate to 14.50% |
| Punjab and Sind Bank |
Base Rate to 10.25% and Benchmark Prime Lending Rate to 14.75% |
| Punjab National Bank |
Base Rate to 10.00% and Benchmark Prime Lending Rate to 13.50% |
| State Bank of Bikaner and Jaipur |
Base Rate to 9.75% and Benchmark Prime Lending Rate to 14.75% |
| State Bank of Hyderabad |
Base Rate to 10.00% and Benchmark Prime Lending Rate to 14.50% |
| State Bank of India |
Base Rate to 9.50% and Benchmark Prime Lending Rate to 14.25% |
| State Bank of Mysore |
Base Rate to 9.75% and Benchmark Prime Lending Rate to 14.50% |
| Union Bank of India |
Base Rate to 10.25% and Benchmark Prime Lending Rate to 14.50% |
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June 22, 2011 at 5:26 pm · Filed under Banks, Brokergae, Builder, Growth Investing, India Real Estate, Indian Properties, Indian Real Estate, Investing, Loans, Marketing, NRI Related, Pre-owned homes, problem, Properties, Prospecting, Real esate, Real estate trends, Reality Firms, Realtor, Referal, Repatriation, Residential Property, Selling ·Tagged agricultural land, apartment, bank, financial institution, home loan, Income Tax Act, Indian Properties, Indian Real Estate, interest rate, land loan, land records, land revenue receipts, layout, loan-to-value ratio, no encumbrance certificate, NRI, plot, property ownership, property title, residential property, Rserve Bank of India, tax benefits, tax receipts
Majority of financial institutions lend home loan to borrowers who are planning to buy a patch of land to build their dream home. Banks grant land loans to salaried and self-employed people and even to NRIs. These loans empower you to buy a residential piece of land.
WHAT KIND OF LAND CAN BE BOUGHT?
Banks do not offer land loans on an agricultural land. As per the guidelines laid down by the Reserve Bank of India, a land loan is specifically given for buying lands for residential means only. Few lenders have fixed set of norms under which the land should be located within certain municipal limits. Apart from this some financial institutions add on a number of restrictive clauses that demand the purchaser to start the construction process on the purchased land within a duration of six months to a year.
IS IT FITTING FOR YOU?
There are a lot of factors that affect a person’s choice of building his dream home on his own. One such factor is the price. Buying a piece of land and then constructing the house on it can some time turn out to be a less costly affair. Also, one can set the pace of construction as per wish to suit his financial conditions. Constructing the home oneself facilitates the owner to put into action his all creative ideas in design and color schemes. Apart from this one also has a liberty to put off main operating cost, enhancements and addition to a future date.
HOW DIFFERENT IS A LAND LOAN FROM A HOME LOAN?
The interest rate for a land loan is on a par as compared with the interest rate of a home loan. One cannot ask for income tax deductions on the interest rate paid for a land loan. But if a borrower converts the land loan into a home loan to get financial support for the construction purpose of the residential property, then surely he can get all the tax benefits available under the Income Tax Act. Apart from this, once a completion certificate is obtained from the appropriate authority, the interest rate paid on the loan is entitled for IT benefits.
DOWN PAYMENT
Borrowers who are looking forward to get a land loan have to pay a higher down payment amount. The loan-to-value ratio for land loan in the case of down payment often goes as high as 70%. Normally, an individual who opts to take a home loan has to pay for only 20% of the cost of property.
DOCUMENTS REQUIRED
It is always advisable to appoint a legal expert to check and verify all the legal documents of the plot in concern. Apart from this, one should also verify the layout drawing of the site as approved by the town planning authority, and no encumbrance certificate of the land. Other property documents that need to be validated comprise of original documents pertaining to ownership of land, revenue receipts, land records and tax receipts.
DOCUMENTS REQUIRED WHILE APPLYING FOR A LAND LOAN
Before the borrower applies for the land loan, he should have some documents in place which include original site ownership documents, tax receipts for taxes paid by the owner, layout drawing, revenue receipts , no objection certificate from society for sale and transfer of land, and no encumbrance certificate for the land.
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June 21, 2011 at 5:43 pm · Filed under Banks, Broker, Finance, Growth Investing, India Real Estate, Indian Properties, Indian Real Estate, Investing, lawyer, legal, Loans, Marketing, Properties, Prospecting, Real esate, Real estate trends, Reality Firms, Referal, Repatriation, Residential Property, Selling ·Tagged bank, emi, financial institution, home loan, Indian Properties, Indian Real Estate, interest rate
Banks are pursuing potential borrowers with their teaser interest rates and exclusive offers. The real estate scenario today is experiencing development of new projects all over the country and builders are engaged in pushing their completed projects at good prices.
BORROWING CORRECT AMOUNT
In the current economic scenario, most of the people who are buying homes are young, salaried IT employees, professionals, entrepreneurs and self-employed businessmen. Real estate has always been considered as lucrative and prudent investment option. The present generation has bought down the age of purchasing homes. The average age now is 28 -34.It is not like 20 years ago when most of the home buyers belonged to the age group of late 40s, who used all their savings to purchase a property. Today, the times have changed, the young generation is well traveled and more dynamic , and they are also being helped by the different financial institutions that have made home loans a far easier process than in the olden days.
The important thing to remember for taking a loan is not to extend the finances beyond a certain limit . The real estate market has product for every pocket i.e from economic affordable housing to ultra luxurious lifestyle condominiums and bungalows. The thing to remember is A bigger amount of home loan means that the borrower will have to pay higher amount as EMIs.
The banks are ready to give home loans of about 50% to 55% of the borrower total monthly take home salary after doing their own due diligence of the clients credit worthiness. Individuals of today are intelligent enough to understand their monthly expenses of their household. Market experience shows that not more than 30% -35% of your monthly income ( whether individual or combined) should form part of your EMI. As you move along in life various other needs keep cropping up like education and upbringing of children , medical expenses etc plus the inflation factor is always there.
STAY AWAY FROM DEBT CON
One needs to keep in mind also that when interest rates increase, the home loan borrowers who have opted for loan have to pay increase EMI installments. If one has not been prudent enough while taking a loan and has taken a bigger amount of loan then in some cases one has to make drastic changes in their day-to-day life and can even have to do away with their current lifestyle, luxuries, periodic investments and saving for emergencies. As mentioned above The amount given by the banks or the financial institutions as home loan results in an EMI and if EMI becomes more than 40 % of the borrower’s total monthly take home salary. The thumb rule suggests that it becomes hard for the home loan borrower to pay back to the financial institution. When borrowers are not able to pay back their EMIs, they end up taking some more loans to repay their previous loan. This taking of more loan to repay the previous loans is not advisale as it might drag a borrower into a vicious circle of debt trap
So the mantra which really everybody of today generation knows is to borrow right and tight. In today’s market scenario there are home options for every pocket.
And yes do remember “OLD is GOLD”, so do not hesitate to take advice of your elders and well wishers,. You will not loose anything, on the contrary will only gain from their experience.
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June 17, 2011 at 5:29 pm · Filed under Banks, Finance, Growth Investing, India Real Estate, Indian Properties, Indian Real Estate, Investing, legal, Loans, Properties, Prospecting, Real esate, Real estate trends, Reality Firms, Repatriation, Residential Property, Selling ·Tagged bank, credit card, emi, financial institution, Floating rate, gold loan, home loan, interest rate, personal loan, Reserve Bank Of India
Recently many financial institutions have raised their benchmark prime lending rates (PLRs). The PLR is normally a reference or benchmark interest rate that is used by the financial institutions for lending loans. The Reserve Bank of India’s decision to raise the key rates affected many banks as they felt the heat of increased cost of funds. To uphold their profitability, the banks transferred this load to the borrowers seeking home loan.
For borrowers who are tight on the budget will surely be affected by the hiked interest rates. But the market analysts opine that instead of losing the nerve, the borrower should understand and learn to handle his financial standing and debts more proficiently.
BE EQUIPPED
Borrowers who have opted for a floating interest rate should expect fluctuations in rate of interest. Some financial institutions even do not intimate the borrowers about the hike. Nor do they alert their clients of any approaching rate increase. Save some amount up your sleeve every month which could be used if in case the lender unexpectedly decides to increase the EMIs.
BUY AT INITIAL STAGE
Purchasing a house at initial stage ensures that the buyer will become debt free very soon. Also, paying off the home loan early in life helps to boost other investments sooner.
BORROW AS PER THE REQUIREMENT
Bigger loan amounts take a longer duration of time to be cleared and can turn out to be more challenging. Home loan borrowers who are not able to pay off the EMIs on time might turn into a defaulter and can even lose their dream home.
STAY AWAY FROM MORE LOANS
If you are not able to pay back the home loan installments on time then you should try to find out a better repayment option with the financial institution. Taking more personal loans and credit card purchases will only turn the conditions difficult. Stay away from unnecessary expenditure.
FIND ALTERNATE SOURCES
A loan against security, a gold loan or borrowing money against any property can be an alternate source to generate the much-required funds. You should not bring your emergency or contingency fund to a halt. Find alternate sources or assets that you can sell and prepay your home loan amount as much as possible.
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June 10, 2011 at 10:48 am · Filed under Commercial Property, India Real Estate, Indian Properties, Indian Real Estate, lawyer, legal, Loans, Properties, Real esate, Residential Property, Selling ·Tagged bank, Bank account, Certificate of income, Continuity of service, Debt, Educational qualifications, Employment details, home loans, interest rate, Photo ID, processing fee, Proof of age, Residence address proof, stamp duty
Getting a home loan is a cumbersome process.
Here is a simple process that will help out a potential buyer to get home loan.
Proper application form: The procedure of getting a home loan begins with a duly filled application form supported with all required documents. Different banks have different norms. Some banks charge a processing fee at the submission time of a loan application. Normally this is a non-refundable amount which is around 0.5% of the total loan amount. Mostly the financial institutions ask information comprising of personal, income and education details along with property details and estimated purchase cost in the application form.
Documents Required: Banks expect that the home loan applicants should provide accurate legitimate documents as proof. Some of the documents required are: Certificate of income, Proof of age, Photo ID, Continuity of service, Residence address proof, Employment details, Educational qualifications, Property to be purchased, and Bank account details.
Application Verification: The bank carries out a detailed verification on creditworthiness, and on other relevant issues like previous defaults and other debts. On the basis of the income level and financial status, the financial institution calculates the loan eligibility. If the lender is doubtful about the repayment ability or if the information provided in the application form is incorrect then loan application might get cancelled.
Evaluation of Property in Question: Bank experts visit the property in question and then assess the same. Lenders normally have a legal experts team who conduct legal verifications of documents. A home loan is kind of a secured loan where a property one wishes to buy is used as collateral. Therefore, the bank carries out technical valuations and checks various stages of construction through the term of the loan.
Home loan agreement: Banks normally send out an offer letter that comprises of the details regarding the loan amount sanctioned, interest rate applicable, tenure, repayment options and, terms and conditions associated with the home loan. The applicant must go through the loan agreement cautiously and sign it if he has no objections to it. The applicant also needs to pay stamp duty and other fees to pay along with the post-dated cheques that must be deposited to the bank.
The banks normally keep the original property documents till the time the complete loan amount is repaid by the borrower.
Loan Payment: Once the loan agreement is signed between the lender and the borrower, the loan payment process starts. However this process might vary from bank to bank.
Spot a good property without any litigation and is situated in a good area. Then choose a good financial institution who offers low home loan rates and doesn’t charge heavy penalties and processing fees.
If one has all documents in place and no previous history of defaults, then getting a home loan will not be a problem at all.
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