Enjoy Year End discounts on Loan against Property

We all know how useful loan against property is for getting easy cash to grow your business or realize your other dreams. Here is one more reason for you to look at availing loan against property in March 2015 in case you need money.

Banks are offering exciting discounts on mortgage loans to meet their year-end disbursement targets and also passing on the benefit of recent repo rate cut by the RBI.

Loan against property calculator-MyLoanCare.in

Banks are keen to grow their loan base as the financial year draws to a close. As banks compete with each other to get customers, they are willing to offer lower interest rates and processing fee discounts like never before. Some of the key offers available in the season are:

  • Loan against property starting at 11.50% per annum compared to card rates of over 13% from leading banks
  • Overdraft facility at 11.60% – 12.0% vs. normal rates of over 13%
  • Tenure Upto 18 years from NBFC’s and Upto 15 years from banks
  • Lowest EMI of Rs. 2199 per month per lakh
  • Processing fee discounts of Upto 75%, with offers available at 0.25% compared to cards rates of over 1%

Best part in 2015 is that there are no prepayments or foreclosure charges on floating rate loans sanctioned to individuals.

What Purpose can loan against property money be used for?

  • Growing your business
  • Renovation of your home
  • Children’s education and marriage
  • Medical treatments
  • Vacation and entertainment
  • Buying another property
  • Repaying higher cost personal loans and credit card loans

What are the key features of loan against property?

  • Loan available against any registered freehold commercial property or loan against personal property
  • Loan tenure Upto 15 years; can extend to 18 years on some cases
  • Easy and fast processing – typically 7-10 days
  • You can get Upto 75% of market value of residential property and Upto 55% of market value of commercial property
  • Low interest rates starting at 11.50% in offer period, else 13% plus

Compare the Loan against Property Interest Rates?

How to take the best loan against property at lowest interest rates, lowest EMI and lowest processing fee? Simply logon to MyLoanCare.in  and you can check out the latest offers or speak with a loan advisor. No charges.

Documents Required for Loan against Property :-

  • Residence and identity proof of the person who is taking the loan
  • Last 6 month salary slip for salaried people and business proof and certificate for businessmen
  • Last 6 months bank statement
  • Completely filled loan application form and a passport size photograph
  • Property title documents

MyLoanCare.in brings the loan against property and enables the loan borrowers to unlock the value of their property. You can mortgage any commercial, residential, or any other property to complete your financial requirements.



Procedure and Cost of Breaking Fixed Deposits before Maturity

Fixed Deposits are one of the most popular savings products in which an investor deposits lump-sum amount for a fixed period of time at a fixed rate of interest. What is important to understand is that while the interest rates may fluctuate, the interest rate on your fixed deposit will stay locked at what it was at the time of opening the account.

There may emerge several situations, where the investor may need to break his fixed-deposit ahead of its maturity date. These situations are typically emergency situations, where the investor requires immediate liquidity for personal or business needs. An investor may also be tempted to break the FD in a situation where prevailing interest rates on Fixed-Deposits are much higher than the rate at which he created the Fixed Deposit and hence, the investor wants to move to a higher rate FD account.

Fixed deposit

However, while RBI regulations allow customers to break their FDs pre-maturely, it also allows banks to charge penalty from their customers on breaking FDs before maturity. Typically, in a bid to discourage customers from breaking pre-mature fixed deposits, banks may charge a penalty of 0-1% on the applicable interest rates. Some banks even go to the extent of allowing interest rate equivalent to the prevalent rate of 1 year FD even on FDs of longer tenure, in case of pre-mature withdrawal.

The difference between 1 year FD and five year FD can be high as 3 percentage points, thus resulting in a significant loss for the investor. Some banks also prescribe minimum lock-in-period of a few months to a year, before which breaking of a Fixed Deposit is not allowed.

Hence, an investor, while taking a decision to break a deposit needs to calculate the associated costs. In normal circumstances, it shall be advisable to limit the decision to break Fixed Deposits to a situation of dire emergency or to a situation where the investor expects to return a higher return on the funds realized from breaking a FD even after incorporating the associated penalties on pre-mature withdrawal.

The customer may also evaluate the option of taking Loan against FDs if he needs funds only for a brief period of time and is not too keen to pay a heavy penalty on breaking his FDs.

Once you decide to break a FD, the process of breaking the fixed deposits is pretty simple and quick. There may be minor variations in the procedure for PSU and private banks or for FDs created online vs. offline.

At the time of creating a fixed deposit, banks issue a receipt of fixed deposits against which you can get a fixed deposit certificate issued from a bank. You can use the same deposit certificate to request the bank officials to break your Fixed Deposit.

You will need to write an application mentioning the reason to break your fixed deposit along with your account deposit number. You will also need to fill the form for pre mature withdrawal of FD.

Further to this, the bank officials can process this request immediately by clicking on a reversal entry in their system.

In case of fixed deposits created online from your internet banking account, majority of the banks would allow online breaking of your Fixed-Deposit.You need to go to the “service request” section of your net banking and can fill a request to break your fixed deposit before maturity online in the Fixed-Deposits section. For the banks which do not provide an option of online withdrawal, you will need to follow the process of offline breaking of Fixed-Deposit as mentioned above.



5 Credit Card Precautions to Protect Your CIBIL Score

Worried about the safety of your credit card? Heard about how a small mistake by your friend while using his credit card cost him dearly?  Concerned about not being able to get a loan with a low CIBIL score in case your credit card is stolen and misused?

Protect Your CIBIL Score

Relax. In today’s time and age, using a credit card is no more a luxury but actually a necessity. So, don’t worry and no need to stop using your card. You just need to take some basic care and take five basic precautions that will help you avoid a low CIBIL score:

1. Keep your password and PIN secure:-

The Reserve Bank of India has mandated that all online and offline credit card transactions in India must be authenticated by password and PIN or one time password (OTP). So, your credit card cannot be used in India for making a fraudulent credit card transaction online or offline unless someone hacks your password and PIN.

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In India, we come across a very strange instance of people using credit cards at fuel pumps. Nothing wrong with it except that some people just don’t want to step out of the car and actually tell the PIN to the petrol pump attendant instead of feeding it into the machine. Now, if the pump attendant fraudulently clones the card, he can easily misuse it at any merchant location. Blame for this misuse clearly lies with the user and not with the bank.

2. Avoid transacting on international websites:

As regards the requirement for a PIN or OTP, there is a catch. This requirement is not valid for credit card transactions outside India or online on websites hosted outside India. So, it is possible that someone may use your credit card on one of these foreign merchant locations or websites hosted outside India if he/ she know your credit card number, expiry date and CVV. As a precaution, avoid making transactions on global websites that do not ask for the PIN or OTP.

One simple solution is to prefer RBI’s NEFT and RTGS modes for transferring money in India and SWIFT for international transfers. These can be accessed from your netbanking account and are fast and safe at the same time.

3. Keep your CVV number secure:-

CVV is a three digit number printed on the back side of the credit card next to the card number above the signature strip. Most websites require the user to enter the CVV number so as to ensure that the user actually has the credit card and is not just using a stolen credit card number. Banks recommend that the CV number be memorized by the user and then scratched off the card surface. The problem is that with multiple cards and so many other passwords to remember, this is easier said than done.

However, some merchant websites may not ask the user to enter the CVV number. So, take care that the site you are transacting on takes CVV verification in addition to the card number an expiry date.

4. Prefer chip based cards as opposed to magnetic strip based cards:

Now, what’s this? Let us explain. Actually, the front of the card which has your name, card number, expiry date and in some cases, a photo, has no machine readable authentication details. In earlier days, cards used to be recognized by the black colour magnetic strip that you see on the back side of the card. The problem with the magnetic strip is that it (or more precisely, the authentication data on the strip) can be duplicated and copies on to another similar magnetic strip using some simple readers.

Nowadays, banks also offer a more secure form of card which comes with a EMV chip as opposed to a magnetic strip. The chip contains the authentication data and the benefit is that the data on the chip cannot be copied unlike a magnetic strip. OK, we stand corrected. Impossible is nothing. So, data of chip is far more difficult to copy as opposed to that on a magnetic strip. So, prefer cards with chip as opposed to strips.

5. Place your signature on back of credit card:-

Why do banks have signature strip at back of the card? This is to ensure safety of transactions at physical merchant locations. The teller or the salesperson accepting payment by credit card is expected to get your signatures on the payment slip and match those against those on the back side of the card. Any mismatch between the two will lead to suspicion and the merchant may either deny the transaction or insist on further verification from the concerned bank.  The bank may call up the actual customer on his registered contact number and manually authenticate the transaction. In case no signature is placed on the card, technically the card is invalid. However, as opposed to looking at this as a rule that you must follow, consider this as a safety feature for your own good.


How Banks Calculate Your Home Loan Eligibility?

Today we will talk about how to calculate how much loan amount you are eligible for. We will talk about how different banks calculate loan eligibility and what are the different parameters which can directly affect your loan eligibility.

The principles used are similar for all types of loans like home loan, car loan, personal loan and loan against property but the calculation differs based on type of loan.

What is Loan Eligibility?

Loan eligibility implies how much money you get from a bank for purchase of your home or against a property you already own or for any other purpose. Your loan eligibility is calculated based on the formula which we discuss with you in this article.

How Banks Calculate Your Home Loan Eligibility

How does the bank look at you at the time of sanctioning a loan?

To understand more about loan eligibility, let us think from a lender’s point of view for a minute. Think as if you are a lender and you are giving money to a person.

Major Factors Which Affect Your Loan Eligibility:

  1. Your monthly income:

First question you will ask a borrower – how much money can he pay as EMI every month.  This depends upon his income and his expenses. You will also want to know how regular or sustainable the income flow is.

It is a simple fact that higher your monthly income more is the chance of your being easily able to pay a larger EMI. Since you also need to meet your regular living expenses, it is fair to say that you can pay only a portion of your income, and not your entire income, as EMI.

  1. Past credit history:

Your past loan repayment record and credit history also determine your loan eligibility. If a person has a bad credit card repayment record, then he/she is categorized as a high risk customer. Either he faces genuine hardship in being able to pay EMI or has been a willful defaulter. In either case, banks are quite wary of lending to such people.

  1. Age of the loan applicant:

Age of the loan applicant also affects loan eligibility. Banks have to ascertain that for how many years you can pay the EMI. A person in his 30’s can pay the loan for next 30 years, but a person who is in his 50’s will retire at 60 years and hence he has less than ten years to pay back his loan.

  1. Profession:

Profession of the loan applicant also determines his/her loan eligibility. Banks want to ascertain if the income flow is regular or not. Some professions such as software developer, doctors, banking jobs are eligible for a higher loan amount as compared to those people who are working in BPO sector.

  1. Your past relation with bank:

Many banks (especially PSU banks) look at your past relationship with the bank and decide your loan eligibility.

  1. Employer category:

All the major banks have categorize big companies into A, B, C categories and provide them different interest rates. So, employees of Cat A companies may be offered better interest rates as compared to others. You need to check about this information with the respective banks which matters a lot in the long-term.

Gold Loan in India at Low Interest Rates

What is a Gold Loan?

Gold Loan is a type of personal loan which is given against security of gold.  Many private banks, public sector banks and other finance companies provide gold loans at attractive rates.

Many people opt for this loan instead of unsecured personal loans to meet the requirements of their children’s studies, marriages and other short term needs.

Gold Loan in India at Low Interest Rates

With the increase of gold prices over recent years, demand for gold loans has increased significantly in monetary terms. For example, Muthoot Finance, one of the leading gold loan providers, has seen a 25% increase in the Gold Loan.

Benefits of Gold Loan:

  1. Lower interest rates compared to personal loans – As gold loans are secured against the pledged gold jewellery and ornaments, rate of interest available on gold loan tends to be lower than that available for unsecured personal loans.

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  1. Minimum paperwork – Bare minimum paper work is required for hold loans. You just need an address proof and an ID proof. Simple process – Bank is lending against the security of gold, which is easy to sell and trade. Hence, it doesn’t need to do a detailed credit check on the customer. All you need to do is need to do is pledge your gold and take up-to 70% of the total market value of the gold as loan.
  2. No income proof – One of the main benefits of gold loan is that you don’t need any salary proof for taking a gold loan. Even an unemployed or non-working person can get a gold loan.
  3. No CIBIL check – Banks and gold loan companies don’t insist on a clean CIBIL report or a high CIBIL score for sanctioning a gold loan. However, gold loan availed by you appears in your CIBIL report. So, any default on gold loan may negatively impact your CIBIL score. On the other hand, a good repayment track record on gold loan may help improve your CIBIL score.
  4. In rural areas, agriculture loan against gold is also available for farmers at low interest rates.
  5. In gold loan, borrowers also have an option to pay entire interest at the end of the loan repayment period instead of regular EMI’s.

Some charges applicable on gold loan:

  1. Loan processing charges: Some banks may waive the charges while others take a processing fee.
  2. Late payment penalty: Any delay in repayment of interest or principal will entail a late payment penalty. Actual penalty may vary from bank to bank.

It is always advisable to check all applicable charges with the gold loan provider before taking the loan. These extra charges could dramatically change the amount which you finally receive.

Important documents required for gold loan:

  1. Identity proof such as driving license, passport etc.
  2. Address proof such as ration card, electricity bill etc.
  3. Signature proof – either PAN card or bank attestation.
  4. 3 passport size photographs.

Below we have listed some of the leading banks and some other financial companies which offer gold loan.

  1. SBI, HDFC and ICICI Bank
  2. Muthoot finance
  3. Mannapuram Gold loan

Useful Tips to Increase Your Home Loan Eligibility

Sometimes, people looking for a home find that the total home loan amount for which they are eligible is insufficient for buying their home. In such a situation one has to look for means of increasing the eligible loan amount.

There are many different ways in which one can increase the eligibility amount for home loan. In this article, we will share some of the useful tips through which one can increase home loan eligibility.

  1. Opt for a longer tenure:

The home loan eligibility is calculated on the basis of how much money one is able to afford as EMI every month. By increasing the loan tenure, the amount of loan increases.  The maximum loan tenure available depends upon two factors – borrower’s age and the maximum loan tenure offered by a bank.  Different banks offer maximum loan tenure of 15 to 30 years on home loans.

  1. Repay Existing Shorter Duration Loans:

If one has other outstanding loans, say a car loan or personal loan or an old home loan with balance loan tenure between six months to five years, the eligibility for fresh home loan will be lower due to lower incremental EMI servicing capability. So, by paying off these loans, the loan amount will increase significantly.

Useful Tips to Increase Your Home Loan Eligibility

3. Add Other Earning Family Members as Co-applicants:

One can add direct family members earning more than Rs. 25000 per month and not older than 60 years as co-applicants. In such a case, their income will also be counted towards determining home loan eligibility. Eligible co-applicants are spouse (husband/ wife), parents, sons, unmarried daughters, brothers and unmarried sisters.

These are some of the easy and legitimate ways to increase your home loan eligibility.