Finance Management

Things to Know About Home Loans

admin — Sun, 16 Oct 2011 14:08:10 +0000

Having ones own home is the dream of every guy. Home loans are actively being taken by most people to meet the capital needs for buying a home. Now many financing companies are giving cash grants to buy real estate properties. These institutions are government owned as well as private. Even mortgage lenders are trying to give their services to purchase a home of dreams. During times of financial emergency most providers of home loans impose strict terms of payment. They are not willing to loose their money at any cost. Those loan debtors who have a strong credit are investigated by loan companies. While applying for a home credit one has to find the right company or money lender. First of all an aspirant should judge his situation, he should be clear about his paying capacity. Then he should seek a loan plan according to his credit rating.

It is an important obligation for home loan applicants to clear their old bills on time. Before advancing money to buy a home, money lenders and banks check the previous credit rating of an applicant. They try to know about previous outstanding debts. This information is collected by money lenders from credit rating companies who keep a track record of debtors. Having a sound savings account to invest a good token money is an easy step to apply for home loans. By showing that an applicant has plenty of savings assures the money lender about the security of his loan. Those who do not have a enough savings can apply for a loan with a stable job. Having an assured source of earning is the most important factor for getting cash credit. Before applying for a loan one should do his best to clear previous big or small loans. One should be aware about reasonable rates of interest before signing any plan.

Choose and Buy Right Car Insurance

admin — Sun, 16 Oct 2011 14:07:16 +0000

If you have recently bought a new car or already own one then car insurance is very necessary to avail for. It gives protection cover and compensates losses in case if your car meets with a mishap or accident. Millions are car insurance companies are trying their best to lure car owners. The entire process of understanding and buying the right auto insurance can be a tough task. Yet some points can help car owners to choose a suitable plan:

The first step is to study the details of terms in a car insurance plan. Every insurance seller offers his services in a convincing language. It is up to the car owner to recognize the pros and cons of every plan. He/she should study and compare 2-3 effective plans to choose the best one.

After choosing a plan the auto owner should negotiate with the insurance seller in terms of premium. High rates of premium are a nightmare for most car owners. They should persuade insurance companies to minimize or optimize the rate of car insurance.

Car owners should have a clean car driving history. Many car drivers use their vehicles rashly and end up with terrible accidents. Most insurance sellers impose high premium for such drivers. Nobody wants to take risk purposely on account of bad car drivers.

Car insurance is the same as other insurance plans. Car owners only need to stay on the safer side to avoid spending more money on premium. While buying any car insurance plan auto owners need to determine the exact rate of insurance coverage. Car is a valuable asset; it needs to be protected from accidents and mishaps. Availing an auto insurance plan is not so difficult because many online auto insurance sellers are ready to make registrations. By filling an online form the plan is set within a week.

Loans

admin — Thu, 08 Sep 2011 16:35:37 +0000

The current financial system has evolved itself to the current stature to allow the distribution of assets, even to the common man, whose current capacities might prevent him from a certain acquisition, which might be monetary or otherwise. Therefore, it is added the much lacked wing span to the dreams of the bourgeois in the society, giving them a somewhat equal chance at a desired lifestyle , on par with other sections.

The topic can be lucidly comprehended under the following headings:-

Definition of a Loan
Loan variants
The markets under the purview
Payment of a Loan
Abuses while lending

The loan, is a type of debt, which is taken by a borrower from a lender and as is usual with the other financial instruments dealing with debts it comprises the redistribution of assets between the two parties involved.

Loan Variants

Secured : The borrower swears by some asset as a collateral for the borrowed loan
Subsidized Loan: A loan that does not add interest until the borrower begins to pay it. Commonly seen in colleges
Non-Subsidized Loan: A loan that adds up interest from the day of disbursement
Mortgage Loan: A very common type of loan used all over the world for acquiring or creating houses, wherein a certain security or lien is given to the bank which possesses the possession of the mortgaged item till the loan is settled. Therefore in case, the borrower fails to repay, the bank can sell the item to settle the debt.
A store hedge load: This is a type of loan wherein the user uses stock possessed in lieu of loses incurred during the course of the loan.
Unsecured Loan: In this type of loan, there is no security placed in lieu of the loan. Examples include credit cards, personal loans, bank overdrafts and corporate bonds.

Target Markets

Personal : Refers to personal or loans by an individual
Commercial: refers to loan taken by a business group or institution

Abuses while lending

Predatory Loan : This is a type of loan that is allocated to the user by a lender with the malicious intent of compromising the borrower. Therefore while loans are normally directed at helping the user, this type of a loan is to debase or be- little an individual. This a very common type of loan used in rural India to exploit individuals who are too helpless to avoid the loan.
Usury Loan: This is an excessive interest rate forcing the user to pay excessive interest rate thereby exploiting the situation. Many banks have been implicated with abusing this possibility to exploit helpless individuals.

Know about Home Loans

admin — Thu, 08 Sep 2011 16:34:04 +0000

All the world is a map, with you are here, written all over it. Acknowledging the pleasures of a vagrant lifestyle, it has to be stated, that humans are classically social organisms, who find common surroundings comforting. While possessing a house might have its own requirements, possessing a house of a particular taste and design seems a much complicated issue, affordable only by a few. But courtesy, the Home loan schemes, it is now possible for each man with basic pre requisites, to dream of his own abode. The topic can be dealt with under the following headings:-

Definition of Home loan
Benefits of the hose loan
Target groups
Plans of refund
Available sources

The loan refers to use of financial products to acquire a house or create one, whichever may be the case. The loan or debt amount allotted to the borrower can be used therefore, for acquiring a house already existing or to create one against standard securities as provided by the borrower.

Benefits of a housing Loan

The benefit of the housing loans or schemes lies in the fact that it allows its borrower to acquire a house or cerate amount, while it might actually not be affordable in the regular sense or ability.
While the borrower acquires the property and starts settling the debt amount as per the plans that have been decided upon, the value of the acquired property keeps on increasing. Therefore the acquisition, though through a borrowed amount ensures the borrower an absolute and sure investment.

Target groups

It might comprise an individual requiring the debt to create a house which might not comprise a whooping amount and therefore relevant tax rebate benefits. The borrower might include a larger group acquiring a larger asset, with interests to modify the basic structure and later utilize the asset to resell it to an interested market at a higher amount.

Plans

The housing schemes might include plans to re pay the debt in easy annual installments, which might be longer if the annual installment is decide for a lower amount. But this might entail more amount being paid as interest.
The entire amount might be financed or perhaps a certain percentage, which might require the client to pay either a fixed amount annually or a fixed amount for certain periods, while the amount keeps changing between the periods.

Available Types of home loans

Home purchase loans
Home improvement loans
Home construction loans
Home extension loans
Home equity loans
Land purchase loans
Bridge loans
Mortgage loans

Home Loan Tips

admin — Wed, 31 Aug 2011 02:45:06 +0000

On one hand where the market with all its twists and turns has made it possible for the common man to dream to possess a house of his own and more importantly, a house of his taste, the entire process can turn particularly complicated as a result of ambitious moves without comprehending the outcomes of a long drawn deal. Therefore, between the options available, the client will have to exercise expertise and wisdom before homing down on a deal. Here are few tips to ensure one doesn’t mess up in any part of the deal.

Affordability

A comprehensive analysis of how much an individual can afford is essential.
Consider income, expenses, down payment and the interest rate.
Visit various lenders and compare options
A counselor to be consulted for the best planning modality

Can and Cant

Knowing all the rights and the lack of them is essential

Saving schemes

Before an individual decides on a loan, it is essential to plan on saving
The individual might have to cut down on his regular expenses
Choosing the scheme with the least interest rate is essential
Comparing various offers from different lenders is of paramount importance

Knowledge

A thorough research on all the available options and programs is essential.
Various programs are available and therefore the user must comprehend the same

Getting Help

Choosing an adequately experienced agent is very essential
Make check lists
Communicate the wants and desires regarding the design , patterns, interiors and other aspects which might entail a change in budget

Having a personal plan

Instead of being the listener, contributing to the deal by offering a personal plan which the lender might have to consider is a great idea.
Agreement must be an option , only if the offer proposed by the borrower is regarded or at lest considered and is made a component of the deal

Investigate

A thorough inspection of the house has to be conducted, which might also require some one with adequate experience of the possible short comings. This might prevent unnecessary investment in a wrong site or property.

Knowledge of the agents and their previous work profiles might be handy in preventing working with the wrong people and therefore prevents complications

Sign up

Finally read the agreement before signing the documents to prevent fraud.

Home Loan Providers

admin — Wed, 31 Aug 2011 02:42:29 +0000

The world is full of those who claim to stand by in case of an unforeseeable requirement. The challenge therefore is not in having around whom can help, but perhaps in deciding to choose between genuine help and help from sources with vested interests. This principle is particularly useful in case of loan sources who claim to see you through your dreams and through their promptness might actually convince an individual to commit an error of judgment and thereby actually profit from the ignorance. Various sources of lenders are available in India, however may vary between the interest rates and other aspects of the deal. Here is a brief review of the common bank sources in India providing housing loans.

The various banks providing home loans are as follows:-

State Bank Of India
Punjab National Bank
Dena Bank
Bank of India
HSBC
Standard Chartered-Grind lays
Citibank

Bank of India

Provides home loans to the following requirements:-

To purchase a plot for the construction of a house
To purchase a house or a flat
For renovation/repair/alteration/addition to a house/flat.
Furnishing of o house
Takeover of customers housing loan extended by other banks

Citibank Standard Home loan

Considers if gross income is greater than one lakh
23 years of age and above to a maximum of 58 years of retirement of age, whichever is higher at the time of maturity

Dena Niwas Housing Finance Scheme

For purchase of a house
For purchase of a plot
Construction of a house
Ready made houses
For extension of an already existing house up to 25 years old
For repairs and up-gradation, which includes the cost of fixtures

HSBC Home Loans

The bank includes various schemes to aid the customers in adding concrete to their dreams
Offering range between Rs 5 Lakh up to 3 Crore

PNB Housing Loan

For construction of a house or a flat
Purchase of a house or a flat on first attorney basis from the original attorney
Carrying out repairs/ renovations/additions/alterations to existing houses

SBI Housing Loans

No cap on maximum loan amount
Option to club income of your spouse and children to compute eligible loan amount
Repayment permitted up to 70 years of age
Free personal accident insurance cover
No administrative charges or application fees

What is Home Equity Loans

admin — Wed, 31 Aug 2011 02:40:30 +0000

The world is an empty canvass for those who can afford the brush, whereas for those, who might be imploding with talent and a taste for exquisite art, but cannot afford the hues and colors, prospects might seem as blank as the canvass itself. Solving this unequal opportunity and outcomes propelled by the lack of sources, has been solved to an extend by the easy procurement of loans , tailored to the requirement of the borrower. One such variety of loans is the Home Equity Loans, which perhaps provides a ray of hope to even those applicants who might not exactly prove their worth in terms of security.

Home Equity Loan

A home equity loan, also abbreviated as HEL is a loan in which the borrower uses the equity in their home as collateral. These loans are useful to finance major expenses such as the following:-

Home repairs
Medical bills
College education
The utility of the procured loan is endless and is obviously user specific but never the less, its certainly useful.

Types

These loans are of two types:-

The closed end variety &
The open end Variety
Both these types are often termed as second mortgages, because these are secured against the value of the property. These are usually of a brief duration when compared to first mortgages.
Income tax rebate is possible on these loans
Home equity loans and home equity line of credit (HELOC) actually differ as the interest rate in the later is adjustable where as the formed is a one time lump loan with a fixed rate. Therefore they differ in one having a more static or constant plan than the other one which is more flexible or evolving.

Home equity loan fees

Appraisal fees
Originator fees
Title fees
Stamp duties
Arrangement fees
Closing fees
Early pay off fee

Surveyor and conveyor or valuation fees may also apply to loans but some may be waived.

Benefit

Home equity loans are readily available for self employed applicants. Therefore while most loans are not given to people who have a difficult time in proving their financial status by providing previous bank statements, which might not exactly be possible if the applicant has not really been active in terms of a regular job. This is certainly a great option.

Education Loans

admin — Thu, 25 Aug 2011 03:37:29 +0000

While much is available in terms of loans to be acquired for businesses and individual car/ housing requirements, the topic remains a little e bleak when it tunnels down to education loans. The future of those who can afford is often dealt with in ease, while for those who are capable but are limited due to lack of monetary assistance, ability and IQ does not certainly seem enough. In such circumstances, loans for education can actually prevent the purging of a bright future at the very conception. A clear understanding of the subject might however require a clear analysis of all the available options.

Student Loan

A student loan is described as a loan that is procured to allow the affordability of expenses related to the curriculum and living of a student. Therefore, the loan, unlike others is not exactly for building a materialistic property or acquiring of assets but perhaps to lighten the future of a student.

Differences from other loans

The interest rate might actually differ, as it is aimed at easing the student in completing his education. Even the repayment of loans might actually differ from other loans while the student still in college or studying.

Eligibility criterions

The procurement of such loans might actually take into consideration many factors which might include the following:-

Income levels
Parents’ income levels
Other financial considerations, including property, college tenures etc before the conclusions are drawn

Repayment

A student loan varies from other loans in several features and therefore is certainly not a conventional loan.
A students loan is usually at least two points lower than the conventional loans’ going market rate
The repayment may be deferred on the principal and the interest until the student is out of school.
Repayment typically begins after a specified time after the student has left college or school.
The period might be decided to be long and affordable, however the interest rates will ensure a greater amount is paid for the same.

Mastery Promissory note

This is an agreement between the lender and the borrower that promises to repay the loan. This is a binding legal contract.

Student benefits

Different forms of student benefits are:-

Direct funding for daily living expenses
Support for renting an apartment
Partially state –funded meals
Securing student loans

Thereby, providing an equal chance and opportunity for all students.

Credit Cards

admin — Thu, 25 Aug 2011 03:35:00 +0000

With the unstoppable progress in technology, life seemingly has been simplified to an obvious level. Where, once upon a time , anxious users would carry next to their quivering bosoms, large sums of money; today the use of plastic money has overtaken any other form of payment system. Thereby making dreams seem just a swipe away.

The concept of credit cards can be understood in a simplified way by a systemic approach to the topic as shown below:-

Definition
Concept or Principles
Interest Rates/ System of Back payments
Variants

Credit Card

A credit card can be described as the clichéd plastic money, as it is a plastic card, with a magnetic strip behind, which aids the transfer of data. These cards are issued to a user from a credit union or bank, allowing the user to buy through relevant vendors or take a cash advance. All cards are designed as per the ISO/IEC 7810 as ID -1., which is 85.60 x 53.90mm.

Concept or Principles of a credit card

The credit card enters the user into a loop, which caters one line of cash transfer to the user, through which he borrows the money under the promise of returning it. Unlike other cards, the user is allowed to have a static or constant debt, on which he pays the interest decided, which is certainly more than any other forms of debt.

Interest Rates/ System of Back payments

The banks or the credit unions waiver interest if the entire payment is made within the grace period & in circumstances where the user cannot refund the balance, then interest is calculated starting from the day of purchase, since when the money has been flowing to the present date on the entire , actual amount of purchase.

Therefore if the user bought stuff for Rs 500 on a certain date and carried a debt of Rs 10 beyond the stipulated period, then interest will be calculated from the date when the user bought the stuff, on the entire Rs 500, till the present date.

Formula for calculating Interest in use of a credit card

The standard formula used everywhere is as follows:-

APR/100 x ABD/365 x the number of days.

APR: Annual Percentage Rate

ABD: Average Daily Balance

Great new To the Users

◦ The basic benefit to the user is that of convenience

◦ No calculation of basic balance before credit, however shouldn’t exceed the credit line determined.

◦ Better fraud prevention than the counterpart cards.

Variants

Charge cards : Require the entire debit to be paid by the end of the month

Debit cards: Can be used as currency by the user, using the actual balance and no credit

Car Financing

admin — Thu, 25 Aug 2011 03:29:06 +0000

What was once considered to be a symbol of luxury and status has now been transformed into a dream even the not so opulent can create and turn to reality. The advent of car financing, custom designed to suit a gamut of customers from a varied background, has certainly made comfort a facility for one and all. The topic of car loans can be lucidly comprehended under the following headings:-

Definition of car financing
Benefits of a car loan
Structure of a car loan
Target groups
Plans of refund
Types of car finance
Available sources

Definition

The topic related to car finance entails the usage of various financial products by individuals or businesses to acquire a car. The point of importance is to note, that all means comprise the definition except for a single lump payment to acquire the same.

Benefit of a car loan

A car loan allows the beneficiary or the borrower to acquire the car without one large single payment, which might actually be not feasible. The acquisition of a loan allows a borrower to raise his stakes or funds to possess a car of his choice without the actual possibility or affordability of the same.

Structure of a Car Loan

The car loans are allotted by the credit units, usually a bank
The amount allotted might actually be the entire amount or a percentage of the entire amount, as decided by the source or lender.
Various plans are usually in vogue and the onus is on the borrower to decide accordingly
The interest rates are decided accordingly, which vary between different sources or lenders and even between various available brands as pre decided by the manufacturer and the lender

Target Groups

The target group might be an individual or a business group. The difference probably is the tax rebate benefits which can be utilized, in case of business groups or larger parties.

Plans of Refund

◦ Settling the debt is according to the plan which is agreed upon at the very outset.

◦ Plans usually range between several years.

◦ The longer the plan, the lesser the monthly installments, but obviously it implies a greater amount to be paid back as interest.

Types of Car Loan

Personal car finance
Personal loans might include the following:-
- Straight forward car loan
- Hire purchase
- Car leasing
- Personal contract purchase
- Non personal finance, usually referring to a business group or a larger client group

Available sources

Usually various third party financers

Some car manufacturers have their own financing. For instance the Ford Motor Credit company and the Ally financial of the General Motors.