Saturday, December 3, 2011
Some Commonly Asked Questions About Home Loans
Some of the common home loan terms that one encounters while applying for a home loan. While the same are common terms amongst lenders they could be brain teasers some times.
What is an EMI?
An EMI refers to an equated monthly installment. It is a fixed amount which one pays
every month towards the loan. It comprises of both, principal repayment and interest payment.
What is pre-EMI interest?
In the case of part disbursement of the loan, monthly interest is payable only on the disbursed amount. This interest is called pre-EMI interest (PEMI) and is payable monthly till the final disbursement is made, after which the EMIs would commence.
What is Fixed ROI?
Fixed ROI stands for the Fixed Rate of Interest. The rate of interest remains unchanged for the entire tenure of the loan irrespective of the drop/increase in the market rates.
What is Floating ROI?
The Floating Rate of Interest is one that fluctuates according to the market lending rate.
This comes with a little risk as in when ever lending rates go up, the loanee will have
to pay more than the amount set aside for loan payment per month.
What is PF?
PF is the processing fees and has to be paid upfront by the customer being fees charged at the time of submission of the application for processing
What is IIR?
IIR is Installment to Income Ratio and denotes the portion of your monthly installment on your home loan as a percentage of your income. The same is capped between 40% to 60 % of income subject to applicant's income & profile.
What is IC?
Whenever a customer delays the payment of the monthly installment, a collection team is sent to the customer's house to recover the money. The expenses incurred on such occasions are called Incidental Charges (IC)
.What is LTV?
LTV stands for the Loan to Value and is used to calculate the loan amount that a person is eligible for on the total cost of the property.
What is Margin Money?
Banks & NBFC fund around 80% to 85% of the cost of the house. The balance 20% to 15% has to be borne by the customer himself. This difference amount is called the Margin Money.
For what purpose can I avail a home loan?
You can take a loan for constructing a house, purchasing of a ready possession house / flat
or a flat in resale, takeover of existing loans from approved banks / housing finance companies, the purchase of a plot of land, for renovation of and extension of the house.
Who can avail of the loan?
Salaried individuals, Self employed professionals or businessmen and individual NRI's.
Who can be a co-applicant for the loan?
All co-owners need to be co -applicants.
Spouse/parents/children can be co-applicants and his / her income can be clubbed to
enhance the loan amount.
What security is to be provided?
Security for the loan is a first mortgage of the property to be financed, by way of deposit of title deeds / or such collateral security as may be necessary. The title to the property needs to be clear, marketable and free from encumbrance. There should not be any existing mortgage, loan or litigation, which is likely to affect the title to the property adversely.
Can loan be repaid ahead of schedule?
Yes, the loan can be paid ahead of schedule, however if the loan is pre paid or transferred to another bank or HFC, a nominal fee @ 2% of principal outstanding is charged
Are the Bank policies subject to change?
Yes. These policies are reviewed periodically.
How is the loan repaid?
An EMI refers to an equated monthly installment. It is a fixed amount which one pays every month towards the loan. It comprises of both, principal repayment and interest payment.
When does the repayment start?
EMI payments start from the month following the month in which the full disbursement
has been made.
What happens in case if a PDC bounces?
In the case of a bounced cheque or delayed payment, charges and outstanding dues will be charged as per the prevailing company policy.
What is the minimum /maximum loan amount?
Home loan are available from 5 lakh to 5 crores.
What is the time frame for a loan to be approved?
It takes a 7/10 working for the loan to be sanctioned after submission of all all documents.
When is the loan disbursed?
The loan will be disbursed on:
- Submission of the legal documents.
- Legal and technical clearance of the property
- Submission of Registered copy of agreement.
What is an amortization schedule?
An amortization schedule is a table giving the reduction of the loan amount
by monthly installments. The amortization schedule gives the breakup of every EMI
towards repayment of interest and outstanding principal of loan.
The Author Subhrajeet Talukdar is the founder of Apex Finance & Marketing in Mumbai in April 2006 and the promoter of Eazeeloans.com a loan advisory portal for Personal loan,Home Loan,Business loan,Loan against Property,working capital, Private finance etc
Contact Information
Phone: 91 22 26833045 E mail: info@eazeeloans.com Website: http://www.eazeeloans.com
What is an EMI?
An EMI refers to an equated monthly installment. It is a fixed amount which one pays
every month towards the loan. It comprises of both, principal repayment and interest payment.
What is pre-EMI interest?
In the case of part disbursement of the loan, monthly interest is payable only on the disbursed amount. This interest is called pre-EMI interest (PEMI) and is payable monthly till the final disbursement is made, after which the EMIs would commence.
What is Fixed ROI?
Fixed ROI stands for the Fixed Rate of Interest. The rate of interest remains unchanged for the entire tenure of the loan irrespective of the drop/increase in the market rates.
What is Floating ROI?
The Floating Rate of Interest is one that fluctuates according to the market lending rate.
This comes with a little risk as in when ever lending rates go up, the loanee will have
to pay more than the amount set aside for loan payment per month.
What is PF?
PF is the processing fees and has to be paid upfront by the customer being fees charged at the time of submission of the application for processing
What is IIR?
IIR is Installment to Income Ratio and denotes the portion of your monthly installment on your home loan as a percentage of your income. The same is capped between 40% to 60 % of income subject to applicant's income & profile.
What is IC?
Whenever a customer delays the payment of the monthly installment, a collection team is sent to the customer's house to recover the money. The expenses incurred on such occasions are called Incidental Charges (IC)
.What is LTV?
LTV stands for the Loan to Value and is used to calculate the loan amount that a person is eligible for on the total cost of the property.
What is Margin Money?
Banks & NBFC fund around 80% to 85% of the cost of the house. The balance 20% to 15% has to be borne by the customer himself. This difference amount is called the Margin Money.
For what purpose can I avail a home loan?
You can take a loan for constructing a house, purchasing of a ready possession house / flat
or a flat in resale, takeover of existing loans from approved banks / housing finance companies, the purchase of a plot of land, for renovation of and extension of the house.
Who can avail of the loan?
Salaried individuals, Self employed professionals or businessmen and individual NRI's.
Who can be a co-applicant for the loan?
All co-owners need to be co -applicants.
Spouse/parents/children can be co-applicants and his / her income can be clubbed to
enhance the loan amount.
What security is to be provided?
Security for the loan is a first mortgage of the property to be financed, by way of deposit of title deeds / or such collateral security as may be necessary. The title to the property needs to be clear, marketable and free from encumbrance. There should not be any existing mortgage, loan or litigation, which is likely to affect the title to the property adversely.
Can loan be repaid ahead of schedule?
Yes, the loan can be paid ahead of schedule, however if the loan is pre paid or transferred to another bank or HFC, a nominal fee @ 2% of principal outstanding is charged
Are the Bank policies subject to change?
Yes. These policies are reviewed periodically.
How is the loan repaid?
An EMI refers to an equated monthly installment. It is a fixed amount which one pays every month towards the loan. It comprises of both, principal repayment and interest payment.
When does the repayment start?
EMI payments start from the month following the month in which the full disbursement
has been made.
What happens in case if a PDC bounces?
In the case of a bounced cheque or delayed payment, charges and outstanding dues will be charged as per the prevailing company policy.
What is the minimum /maximum loan amount?
Home loan are available from 5 lakh to 5 crores.
What is the time frame for a loan to be approved?
It takes a 7/10 working for the loan to be sanctioned after submission of all all documents.
When is the loan disbursed?
The loan will be disbursed on:
- Submission of the legal documents.
- Legal and technical clearance of the property
- Submission of Registered copy of agreement.
What is an amortization schedule?
An amortization schedule is a table giving the reduction of the loan amount
by monthly installments. The amortization schedule gives the breakup of every EMI
towards repayment of interest and outstanding principal of loan.
The Author Subhrajeet Talukdar is the founder of Apex Finance & Marketing in Mumbai in April 2006 and the promoter of Eazeeloans.com a loan advisory portal for Personal loan,Home Loan,Business loan,Loan against Property,working capital, Private finance etc
Contact Information
Phone: 91 22 26833045 E mail: info@eazeeloans.com Website: http://www.eazeeloans.com
Wednesday, November 30, 2011
Abolishment of Home loan Prepayment Penalty
The much eagerly awaited thorny issue of prepayment penalty on Home loan foreclosure has finally found some succor by the announcement from NHB –National Housing bank a wholly owned subsidiary of The Reserve bank of India and a regulator for all housing finance companies that no HFC shall be allowed to charge prepayment penalty on home loans on floating rate of interest whether from own funds or take over by any bank.
This would apply to home loans on fixed rate prepaid from own funds but not on loans taken over by other HFC. Currently most of the HFC charges a pre penalty of 2% on foreclosure whether from own funds or takeover. This decision was taken at the Banking Ombudsmen conference held recently.
One more issue was resolved by the decision by the NHB to implement same floating rate of interest for new as well as existing customers already on board. Currently banks were implementing a differential rate of interest for old and new customers.
Axis bank, Bajaj finance and SBI have already announced their acceptance of the new policy roll out and all the other players are expected to follow soon.
Effect of the new policy and its implementation on mortgages is awaited keenly.
This would apply to home loans on fixed rate prepaid from own funds but not on loans taken over by other HFC. Currently most of the HFC charges a pre penalty of 2% on foreclosure whether from own funds or takeover. This decision was taken at the Banking Ombudsmen conference held recently.
One more issue was resolved by the decision by the NHB to implement same floating rate of interest for new as well as existing customers already on board. Currently banks were implementing a differential rate of interest for old and new customers.
Axis bank, Bajaj finance and SBI have already announced their acceptance of the new policy roll out and all the other players are expected to follow soon.
Effect of the new policy and its implementation on mortgages is awaited keenly.
Friday, July 16, 2010
Another Milestone Achieved By Eazeeloans
In just under a year since the achievement of its first milestone in Aug. 2009 the start up loan advisory portal www.eazeeloans.com has surpassed all expectations and is proud to announce the 50,000th customer to apply online on its portal.
“Looking back and pausing to recollect the uncertain and shaky global scenario prevailing when the portal was launched a year back this is a major and monumental achievement and the success can only be attributed to the selfless and ’never say’ die attitude of the entire team without whose contribution this would never have been possible. I congratulate the entire team and wish for their continued patronage and contribution to scale greater heights.” So quotes the founder Mr. Subhrajeet Talukdar.
“This is a most satisfying moment and should motivate us all to break new barriers. We have plotted a fresh course and plan for the scaling new peaks and uncharted destinations. Yes currently the entire team is in a jubilant mood and the celebrations shall be long and hard and why not? This would also be the time to look back and reflect on the mistakes committed and learning from them in a positive manner.” Said co-founder and wife Ms. Jyoti Talukdar.
The milestone is a significant step and a reflection of the policies, practices and process ingrained and also a reflection of the consistent service and the resultant customer satisfaction.
The portal has of late been given a facelift and redesigned with a wider content and has a much more pleasant and appealing look about it. The site itself remains as easy as before to navigate and the response time is as good before.
About
Eazeeloans.com is a loan advisory portal launched in Mumbai that offers the best loan deals for Personal Loans, Home Loans, Auto Loans, Business loans, Mortgages, Secured loans, Unsecured Loans, Working capital, Private Finance. It is managed by trained professionals and is associated with various leading banks to provide fast and easy hassle free loans. The site is currently receiving around 200 unique applications daily on its portal for the various services on offer.
Contact
Email: info@eazeeloans.com
Website: www.eazeeloans.com
Fax: 91 22 26826745
Landline: 91 22 26833045
“Looking back and pausing to recollect the uncertain and shaky global scenario prevailing when the portal was launched a year back this is a major and monumental achievement and the success can only be attributed to the selfless and ’never say’ die attitude of the entire team without whose contribution this would never have been possible. I congratulate the entire team and wish for their continued patronage and contribution to scale greater heights.” So quotes the founder Mr. Subhrajeet Talukdar.
“This is a most satisfying moment and should motivate us all to break new barriers. We have plotted a fresh course and plan for the scaling new peaks and uncharted destinations. Yes currently the entire team is in a jubilant mood and the celebrations shall be long and hard and why not? This would also be the time to look back and reflect on the mistakes committed and learning from them in a positive manner.” Said co-founder and wife Ms. Jyoti Talukdar.
The milestone is a significant step and a reflection of the policies, practices and process ingrained and also a reflection of the consistent service and the resultant customer satisfaction.
The portal has of late been given a facelift and redesigned with a wider content and has a much more pleasant and appealing look about it. The site itself remains as easy as before to navigate and the response time is as good before.
About
Eazeeloans.com is a loan advisory portal launched in Mumbai that offers the best loan deals for Personal Loans, Home Loans, Auto Loans, Business loans, Mortgages, Secured loans, Unsecured Loans, Working capital, Private Finance. It is managed by trained professionals and is associated with various leading banks to provide fast and easy hassle free loans. The site is currently receiving around 200 unique applications daily on its portal for the various services on offer.
Contact
Email: info@eazeeloans.com
Website: www.eazeeloans.com
Fax: 91 22 26826745
Landline: 91 22 26833045
Monday, March 1, 2010
Credit Card Settlement-New norms on anvil by RBI
There is finally a ray of hope for the countless and hapless credit card users
who were so far being held to ransom by credit card providing banks even on final
settlement of dues by forwarding their names to Cibil, as still owing dues to the
banks.
The Reserve Bank of India is very soon coming out with new guidelines which will
disallow any bank to treat a customer as a defaulter if they have negotiated the
amount payable against his account and paid the amount to the banks providing such
credit cards.Currently even after the customer has paid the negotiated amount as offered by the bank, their names continue to be forwarded to Cibil-Credit Information Bureau Of India Limited, the central repository of all consumers credit history across all banks formed in Jan 2001.
As a result of being treated as a defaulter the customer is not able to avail of any
loans like personal loan or home loan from any banks as the credit rating maintained
by Cibil takes a freefall downward. Being cornered and without any hopes of
acquiring such loans from any banks the customer has to settle any dues as claimed
and raised by the banks being the balance amount of the earlier settled amount plus
penalties and interest due till date.
Mr.Arun Thukral, M D Cibil confirmed the current practice after a series of meetings
with RBI, banks and Cibil. At present whenever dues are settled with a bank the
balance is usually treated as amount written off. In many cases banks raise bills for
very small amount balance including annual fees after settlement which should not
have been charged at all in the first place.
Though the RBI is taking a very serious note of the matter and will declare
fresh guidelines to address the current ailment in due course countless affected
customers await with bated breath of the succor to be provided by the Apex Bank
of India.
The author Subhrajeet Talukdar is the founder of Apex Finance & Marketing in Mumbai in April 2006 and the promoter of Eazeeloans.com a premier loan advisory portal.
http://www.eazeeloans.com
who were so far being held to ransom by credit card providing banks even on final
settlement of dues by forwarding their names to Cibil, as still owing dues to the
banks.
The Reserve Bank of India is very soon coming out with new guidelines which will
disallow any bank to treat a customer as a defaulter if they have negotiated the
amount payable against his account and paid the amount to the banks providing such
credit cards.Currently even after the customer has paid the negotiated amount as offered by the bank, their names continue to be forwarded to Cibil-Credit Information Bureau Of India Limited, the central repository of all consumers credit history across all banks formed in Jan 2001.
As a result of being treated as a defaulter the customer is not able to avail of any
loans like personal loan or home loan from any banks as the credit rating maintained
by Cibil takes a freefall downward. Being cornered and without any hopes of
acquiring such loans from any banks the customer has to settle any dues as claimed
and raised by the banks being the balance amount of the earlier settled amount plus
penalties and interest due till date.
Mr.Arun Thukral, M D Cibil confirmed the current practice after a series of meetings
with RBI, banks and Cibil. At present whenever dues are settled with a bank the
balance is usually treated as amount written off. In many cases banks raise bills for
very small amount balance including annual fees after settlement which should not
have been charged at all in the first place.
Though the RBI is taking a very serious note of the matter and will declare
fresh guidelines to address the current ailment in due course countless affected
customers await with bated breath of the succor to be provided by the Apex Bank
of India.
The author Subhrajeet Talukdar is the founder of Apex Finance & Marketing in Mumbai in April 2006 and the promoter of Eazeeloans.com a premier loan advisory portal.
http://www.eazeeloans.com
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