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Prepayment: How to make the best use of your excess money

However, in the case of a car loan, it is ideal to repay with additional money as a car loan would be at a higher interest rate than the home loan without any tax benefits and, finally, a car. is definitely a depreciating asset. whereas in general a house is an asset that appreciates.

In an age when fixed income products offer lower returns and stock markets remain foamy, individuals should use their excess cash to prepay long-term debt such as outstanding credit cards, debts and loans. personal, auto and real estate loans.

Experts suggest that if an individual can generate after-tax returns higher than the current interest rate on a home loan, then they should invest in the excess money. They suggest that stock valuations are stretched and returns can be mixed and investors who start investing in stocks now shouldn’t expect much higher returns. Before prepaying loans that contribute to long-term asset building, a person should secure sufficient emergency funds to cover expenses for one year and adequate life and health insurance coverage. If this is not done, in an emergency the person may need to take out a personal loan, which attracts a much higher rate than a home loan.

However, in the case of a car loan, it is ideal to repay with additional money as a car loan would be at a higher interest rate than the home loan without any tax benefits and, finally, a car. is definitely a depreciating asset. whereas in general a house is an asset that appreciates.

Prepaid real estate loan
As equity investments have yielded higher returns, one can record profits and prepay part of the mortgage. Experts say the ideal strategy in this bull market is to stay invested with occasional reservations of partial profits and shift some profits to fixed income or prepay loans with higher interest rates. As interest rates on home loans have fallen over the past two years, prepaying is ideal as a rise in interest rates will place an additional burden on the borrower.

Experts suggest that if individuals are unable to make a lump sum payment, they can opt for a systematic withdrawal plan from their mutual fund investments and use the monthly proceeds to increase the EMI. The EMI increase can be requested at any time and there is no charge for such a request. Additionally, for an employee, the increase in EMI helps as the borrower progresses in their career and higher compensation packages that will result in higher disposable income.

In a home loan, the interest portion is prepaid. Thus, a borrower must start prepaying a certain amount in the first year of the loan. Paying early later does not save much in terms of interest payments. Banks do not charge any prepayment penalties on floating loans and banks will accept prepayment if it is made from their own funds and as proof they will ask for a six month bank statement.

Before repaying a mortgage loan early, it is necessary to evaluate the tax advantages of the mortgage loan. The Income Tax Law provides for a tax deduction of interest in the case of self-employed up to Rs 2 lakh and up to Rs 1.5 lakh on the repayment of principal under Article 80C.

Clear credit card contributions
Any excess money should be used to pay credit card dues. Rolling credit by paying the minimum amount owed is not a good idea as banks charge an interest rate of between 35% and 45% per annum, depending on spending, amortization, and banking habits. use. In fact, rolling credit is much more expensive than even a personal loan, which can be used at 13-15% per annum.

If you have more than one credit card, you must first pay the premiums on the card that charges the highest interest rate. This will reduce the individual’s interest expense, as unpaid contributions on cards with a higher interest rate will accumulate more interest. So, once the credit card bill with the highest interest rate is paid off the excess money, it must then switch to the card with the least outstanding balance.

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Convicted rapist got a job in a hospital psychiatric unit


A man convicted of rape was able to find employment with vulnerable people in a hospital psychiatric unit.

Nathan Puma lied to get the job at the Ablett unit at Glan Clwyd Hospital, and while working there he perpetrated a series of frauds.

In a fraud, he tricked a single mother who responded to an offer on social media to join an escort agency. He promised her several thousand pounds which she never received, told her his name was Jason and slept with her several times before using her name and contact details to apply for loans from a total amount of £ 51,000.

Read more: See our full court coverage in Wales here

She received reimbursement requests and went to the police. The woman, who was studying at the university, also contracted an infection which she attributed to her meeting with “Jason”.

In another fraud, he claimed to have served in the military and won the Victoria Cross.

Puma, 29, formerly of Colwyn Crescent, Rhos-on-Sea, pleaded guilty to a series of frauds and failing to comply with sex offender notification requirements and was jailed for five years.

Mold Crown Court has learned he has given a false date of birth and a disclosure check showing he has no convictions to get the job at the hospital.

His lie was discovered in the Ablett unit at Glan Clwyd Hospital after earning £ 5,396 as a healthcare worker with vulnerable patients. He was convicted of rape in 2012.

Prosecutor Andrew Green said when Puma worked at Glan Clwyd he tricked a nurse, living in a trailer to be away from his family because of Covid, to sign a rental agreement for a house in Rhos-on-Sea which he did not clean but had been renovating. She said she had lost £ 7,500.

In 2019, Puma got a job for a company at Deeside, claiming he was a former military man and won the Victoria Cross. He was fired for dishonesty after four months, the prosecutor said.

Defense attorney Owen Edwards said some frauds had elements of fantasy. Few won the VC and many were posthumous awards. Puma had said he was contrite and had converted to Christianity.

He had lost his marriage, his home, his beloved dogs and his grandfather died while in prison.

“It is now at the bottom. He really wants to build a new life, ”said the lawyer

Judge Niclas Parry described Puma as a “mean and ruthless professional fraudster” who had been committing an offense since the age of 17.

For the latest updates via email from WalesOnline, click here.

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5 signs your financial style doesn’t match your partner’s


You both love dogs, love the same movies, and can sit quietly in silence for hours on end, as long as you’re together. In short, you think you have found “the right one”. But what about your financial compatibility? Are you sure your financial styles match? Here are five signs it’s time to be on the same financial page.

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1. Hidden debt

If you or your partner are hiding debts from each other, there is an obvious problem. Hiding debt can be a sign of shame, embarrassment, or just plain lack of confidence. No matter how much you enjoy being together, financial intimacy means sharing the good and bad details of your financial life.

Financial privacy depends on being honest about even the most embarrassing financial details. If you haven’t mentioned how much debt you are in, now is the time to put things in perspective. If you think your partner is sitting on a pile of hidden debt, clean the air by creating a safe place to share financial secrets.

2. Too quick to use credit

A sure recipe for stress is when a partner takes out credit to pay off whatever pleases them, without a clear plan to pay off the debt. Worse yet, a partner expects you to bail them out when they are too deeply in debt.

While your partner’s spending habits can be a touchy subject to discuss, their ability to manage credit can come back to you.

The same goes if you are the one who uses plastic without giving it much thought. Unless you pay off your credit cards in full each month, you risk incurring high interest rate debt. The problem with high interest debt is how quickly compound interest accumulates and the difficulty in getting out of debt once you’ve let that interest rise.

If you are serious about your relationship, your partner has a right to know about your debt, and you should know if your partner is having trouble buying on credit. Ideally, you can work together to overcome the problem.

3. Bad credit

Let’s say you have great credit, but your partner has spent years randomly paying bills and their credit rating is bad. You usually take public transportation, but you’ve gotten far enough away from work that you both think it’s time to buy a car. You plan to buy it together. However, your partner’s credit rating is too low to qualify for a loan. Unless you earn enough to qualify on your own, you may have to wait to make the purchase, all because your partner has a low credit score.

Relationships change. It’s neither good nor bad, it’s just inevitable. Minor irritants that you can ignore early in the relationship (such as a partner with low credit) become significant and irritating. Like a pebble in a shoe, the longer you hold onto it, the more painful it becomes.

Before things get dire, sit down and discuss the importance of a good credit score. No matter which of you has poor credit, consider working together to give it a boost. Meeting the challenge together provides opportunities to make financial decisions and develop new financial skills as a couple.

4. Chronic unemployment

Millions of Americans lost their jobs last year due to COVID-19. And between 2000 and 2010, manufacturing in the United States fell by a third, forever changing the employment landscape. Job losses are occurring. But if your partner never seems to find a good enough job for them or is repeatedly laid off, you might have a problem on your hands.

If you are looking for a sense of financial security, a chronically unemployed partner will likely be a challenge. Prevent it by finding out if your partner’s job losses are circumstantial (due to a recession, pandemic, or natural disaster) or choice (absenteeism, drug use, or verbal altercations). If the losses are due to circumstances, work together to find potential solutions, such as networking to find a job or starting a business. If the job losses are due to your partner’s choices, dig deeper to see if this is a situation you can live with.

5. Different dreams for the future

The safest way to run into a financial hurdle with your partner is to assume that you share the same dreams. If you haven’t discussed where you see yourself in the future, ask your partner what their dreams are. If you dream of marriage, kids, and a house in the suburbs, and your partner dreams of retiring at 35 and volunteering with Doctors Without Borders, you must know it.

Different dreams require different financial planning. For example, if you plan to live in the same city for the next 40 years, taking out a mortgage isn’t a bad idea. If you plan to travel the world, buying a home is a riskier proposition.

As warm and fuzzy as any relationship begins, there are always bumps in the road. The good thing about problems – even financial problems – is that once you solve them together, you have a plan for dealing with all kinds of day-to-day problems.

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3 Credit Report Mistakes That Could Lower Your Score


You will often hear it said that it is important to check your credit report a few times a year. This will help you determine if you are in a good position to apply for a large loan such as a mortgage. And it will also give you a warning if there is any fraudulent activity that you may have been the victim of.

While reading your credit report, you may come across some errors. Unfortunately, credit report errors are actually quite common. And these three things could end up having a negative impact on your credit score.

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1. Overdue debts you are already up to date

Your payment history – the extent to which you are on time to pay off your debts and obligations – carries more weight than any other factor in calculating your credit score. So if your credit report lists overdue accounts, it could easily hurt your score.

It is possible, however, that debts may be listed as past due on your credit report that you have already paid off or are up to date. If you see a debt listed as unpaid and you know you have paid it off, contact the credit bureau reporting this error and provide any documents you have that show the debt has been settled.

2. Accounts you never opened in the first place

Having too many loans or open credit card accounts can hurt your credit score. So if you see an account listed on your credit report that you have never opened, you will need to investigate.

Your first step should be to call the bank or credit card company behind that account and confirm with them that they show an account listed in your name. If so, you may have been the victim of fraud. If they don’t show an account opened in your name, ask for a letter to that effect that you can share with the information desk in question.

3. Incorrect loan or account balances

Another important factor that goes into calculating your credit score is your credit utilization rate. This ratio measures how much of your available revolving credit you are using at one time.

A higher ratio is not good for your score, so if your credit report says you have a $ 5,000 balance on a credit card when you know you only owe $ 2,000, it is something that you will want to correct. In this situation, providing the reporting office with your last credit card statement should do the trick if that statement clearly shows that your balance is much lower than the amount shown on your credit report.

It’s important to stay on top of your credit report whether or not you apply for a large loan. It’s a good idea to check your report every three months and make sure mistakes aren’t hurting you.

Normally, you can request a free copy of your credit report each year from each of the three major reporting bureaus – Experian, Equifax, and TransUnion. Right now, however, credit reports are free on a weekly basis until April 2022. So if you want to do a little more investigation, this is definitely an option worth considering. used.

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Getting back to your financial basics – Portland Press Herald


By being proactive in economic recovery, Mainers can mitigate the immediate impact of the pandemic on their finances and guard against a financial crisis in the future. Here are five tips to help you regain your financial balance during this time of continuing uncertainty and beyond:

1. Build an emergency fund

If people learned anything in March 2020, it was to expect the unexpected. Before the pandemic, nearly one in four Americans had no emergency savings, with 40% of Americans not having enough money to cover an emergency expense of $ 400. Unfortunately, financial woes seem to be more common than financial windfalls, meaning that an emergency fund can save the day when needed. According to a popular rule of thumb, you should aim to save between three and six months of expenses. In a medical emergency, job loss, car trouble, device failure, or even a global pandemic, saving money can be a big help. Not only can this keep you from stressing out over financial uncertainty, it can help you avoid resorting to loans or credit cards to stay afloat. If you can, consider automating your emergency savings. For example, if your goal is to withdraw $ 50 from your paycheck each week and add it to your emergency fund, adjust your payroll settings so that this amount is automatically transferred to an account at your credit union. Because the money is automatically transferred, you won’t be able to impulsively spend that money on something else and you will continue to grow your savings.

2. Take advantage of the pre-tax benefits

In keeping with the theme of having money set aside for future use, you should consider contributing to the pre-tax benefits if you can. If your employer offers health insurance, life insurance, 401 (k), health savings account (HSA), or flexible spending account (FSA), you should take advantage of it. These are all pre-tax benefits, meaning your employer withdraws money from your paycheck to pay for the benefits before withdrawing money to cover taxes owed on your income. For example, if you earn $ 40,000 per year, but have contributed $ 1,000 to your FSA

to spend on qualifying health care expenses, you should only tax on $ 39,000 instead of $ 40,000. If you’ve also contributed to a 401 (k) retirement plan and subscribed to a health insurance plan, you could further reduce your taxable income. Not only are you lowering your taxes, but many of these benefits help you save money for the future. Contributing to a 401 (k) can help you build your retirement nest egg, and the HSA and FSA can cover medical expenses. At times like these, peace of mind when it comes to managing healthcare expenses is priceless.

3. Pay off high interest debt

Paying off debt is an important step in regaining your financial balance. You should consider making a list of all of your debts, including how much you owe and what the minimum interest rates and payments are. Next, determine if you have any debts that are currently in a grace period due to the pandemic. If you do, use that money to pay off your high interest debt still owed. For example,

You should consider making a list of all of your debts, including how much you owe and what the minimum interest rates and payments are. Shutterstock

Federal student loan payments are on hold until February 2022. The money you would usually make a student loan payment with may be better used to pay high priority bills, such as a mortgage or rent. Since no interest accumulates on student debt until February, you will not be penalized for not paying your student loans at that time. However, a mortgage lender or homeowner may not be so forgiving. If you are trying to prioritize the payments you can afford to make, you should continue to pay the bills that don’t offer a temporary break on the balance of principal and interest. For example, if you have high interest credit card debt, pay it off first instead of continuing to pay off your student loan.

4. Reduce non-essential expenses

How many 30-day free trials did you sign up for and forgot to cancel? Do you go to the gym often enough to justify your monthly membership? Take a look at your recent cash statements and figure out exactly what you’re paying each month. The costs of TV packages, magazines and other subscriptions add up and can get more expensive than expected. If you don’t take advantage of it, cancel it. If you use the services, do some research to see if there are cheaper alternatives. By taking a few minutes to assess where your money is going, you can avoid spending more than you need to and use those funds to improve your financial situation.

5. Ask for help

Finally, ask for help. As the pandemic has resulted in increased isolation and the perception that people should do everything on their own, it’s important to know that we’re all in the same boat. If you have questions about getting your financial situation back on track, contact your local credit union for help. The goal of all Maine credit unions is to help you be successful.

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Evergrande gave workers a choice: lend us money or lose your bonus


When struggling Chinese real estate giant Evergrande ran out of cash earlier this year, it turned to its own employees with a strong case: Those who wanted to keep their bonuses should give Evergrande a short loan. term.

Some workers have asked friends and family for money to lend to the company. Others borrowed from the bank. Then, this month, Evergrande suddenly stopped repaying the loans, which had been billed as high-interest investments.

Today, hundreds of employees joined panicked homebuyers to demand reimbursement from Evergrande, rallying outside the company’s offices across China to protest last week.

Once China’s most prolific real estate developer, Evergrande has grown into the country’s most indebted company. It owes money to lenders, suppliers and foreign investors. He owes unfinished apartments to homebuyers and has racked up over $ 300 billion in unpaid bills. Evergrande faces lawsuits from creditors and has seen its shares lose more than 80% of their value this year.

Regulators fear that the collapse of a company the size of Evergrande will cause upheavals throughout China’s financial system. Yet, so far, Beijing has not intervened with a bailout, having promised to teach the indebted corporate giants a lesson.

Angry protests by homebuyers – and now the company’s own employees – could change that calculation.

Evergrande is at the mercy of buyers of nearly 1.6 million apartments, according to one estimate, and could owe tens of thousands of its employees money. While Beijing remains relatively silent on the future of the company, those who are owed money say they are getting impatient.

“We’re running out of time,” said Jin Cheng, a 28-year-old employee from the eastern city of Hefei, who said he invested $ 62,000 of his own money in Evergrande Wealth, the investment arm of the company, on demand. senior management.

As rumors circulated on the Chinese internet that Evergrande could go bankrupt this month, Mr. Jin and some of his colleagues gathered outside provincial government offices to pressure authorities to intervene.

In the southern city of Shenzhen, homebuyers and employees crowded into the lobby of Evergrande’s headquarters last week and shouted for reimbursement. “Evergrande, give back my money that I earned with blood and sweat!” some could be heard screaming in video footage.

Mr. Jin said employees at Fangchebao, Evergrande’s online platform for real estate and auto sales, have been told that each department should invest in Evergrande Wealth on a monthly basis.

Evergrande did not respond to a request for comment, but the company recently warned it was under “enormous” financial pressure and said it had hired restructuring experts to help determine its future.

It hasn’t always been that way.

For more than two decades, Evergrande has been China’s largest developer, making money out of a real estate boom on a scale the world has never seen. With each success, Evergrande has expanded into new areas: bottled water, professional sports, electric vehicles.

Banks and investors cheerfully invested the money, betting on China’s growing middle class and its appetite for homes and other properties. More recently, real estate has come under intense scrutiny from Chinese regulators who want to end the boom years and have forced the industry to start paying down debt.

The idea was to reduce the exposure of Chinese banks to the real estate sector. But in the process, regulators withdrew the money developers like Evergrande needed to finish building homes, leaving families without the homes they had already paid for.

“The Chinese financial system is really complex and when you see cracks like this you realize the impact it could possibly have on society,” said Jennifer James, investment manager at Janus Henderson Investors. “If Evergrande were to disappear tomorrow, it could be a socially systemic problem. “

Ms James and other investors said they only heard about Evergrande’s wealth management strategy involving its employees this month, when the company disclosed that he owed $ 145 million in repayments.

Evergrande has attempted to sell parts of his vast empire to raise new funds, but said last week he was “not sure the group would be able to close such a sale”. He accused the media of triggering panic among homebuyers with negative coverage.

But Evergrande’s funding channels started to dry up long before last week. According to employee interviews, state media reports and corporate documents seen by The New York Times, the company began forcing staff members to help bail it out as early as April, when she started selling short term loans.

About 70 to 80 percent of Evergrande employees across China were asked to donate money that would then be used to help fund Evergrande’s operations, Liu Yunting, consultant for Evergrande Wealth, recently told Anhui. Online Broadcasting Corporation, a public news group.

A version of this interview went offline on Friday. Anhui Online Broadcasting did not respond to a request for comment.

The scope of the campaign and the amount of money it could have raised was unclear. Employees were told to each invest a certain amount of money in Evergrande Wealth products, and if they didn’t, their performance pay and bonuses would be suspended, the employees told Anhui.

Company management said the investments were part of “supply chain finance” and would allow Evergrande to make payments to its suppliers, Liu said in his interview with Anhui. “Because we, the employees, had to fill a quota, we asked our friends and families to put in some money,” he said.

Mr. Liu said his parents and in-laws invested $ 200,000 and that he invested around $ 75,000 of his own money in Evergrande Wealth.

Even before the protests last week, Evergrande was on the wrong side of Beijing. At the end of last month, its executives were called to a meeting with regulators. Officials of major banking and insurance supervisory bodies in China Recount leaders to settle their huge debt in order to maintain the stability of the Chinese financial market.

The authorities’ biggest concern is with the unfinished apartments at Evergrande. The company has nearly 800 developments underway in more than 200 cities across China.

Evergrande, which has often pre-sold apartments to raise funds before their completion, may still have to deliver up to 1.6 million properties to homebuyers, according to a Barclays estimate.

Under close scrutiny, Evergrande convened its senior executives earlier this month and asked them to publicly sign what he called a “military order” – a commitment to complete unfinished real estate developments.

Wesley Zhang and his family are among the hundreds of thousands of families still waiting for their apartments, and they are hopeful that the company will be able to deliver. Mr. Zhang, 33, joined other homebuyers who protested in Hefei last week after learning that Evergrande also owed its employees money.

“Everyone is anxious, we are a bit like ants on a hot pan, having no idea what to do,” Mr. Zhang said, using a Chinese expression to describe the distress of seeing an investment of $ 124,000 potentially disappearing. He said he hoped the protests would spur the government to act before it was too late.

“We hope this will prompt the central government to pay enough attention,” Zhang said. “Then someone would come out to intervene. “

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Banks To Fix ‘Problems’ In Student Credit Card Loans In 14 Days Calcutta News

Calcutta: Chief Secretary of State HK Dwivedi met with representatives of private banks on Saturday to iron out problems that beneficiaries of the student credit card program would face in obtaining unsecured loans for higher education.
Bank officials, who attended the meeting in Nabanna, reportedly assured Dwivedi that the loan repayment system would be streamlined within two weeks.
The credit card system, a flagship initiative of the government of Mamata Banerjee in Bengal, was among the promises made in the Trinamool congressional manifesto ahead of the parliamentary elections earlier this year. Under this program, economically weak but deserving students can receive a loan of up to Rs 10 lakh at a nominal interest rate, depending on the repayment term.
However, soon after the program rolled out, district officials complained about banks’ reluctance to allow unsecured loans – such as a mortgage on a land deed / house or a fixed deposit of an equivalent amount – although the state is the guarantor of every student in need of this financial assistance.
The government had issued standing instructions to the state-level committee of bankers on the need for hassle-free student loans, but it received a lukewarm response. After complaints poured in at a review meeting on Friday, the chief secretary decided to intervene.

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Home loan competition intensifies as banks embark on a wave of lower interest rates


As the economy is recovering and the home buying market is expected to see growth in the upcoming festival season, lenders are rushing to lure home loan customers with rate cuts. ‘interest. Although the Reserve Bank of India (RBI) has kept policy rates unchanged at 4% for the past seven review meetings, banks led by the State Bank of India, Kotak Mahindra, PNB and others have reduced the rate. mortgage rates last week, triggering competition between banks to attract customers.

SBI, which has a home loan portfolio of Rs 5.05 lakh crore, now offers home loans tied to the credit score at 6.70% regardless of the loan amount. The offer translates into a saving of 45 basis points, which translates into a huge interest savings of over Rs 8 lakh, for a loan of Rs 75 lakh with a term of 30 years, according to the bank. The outstanding mortgage loans of the banking sector showed a growth rate of 8.9% to Rs 14.66 lakh crore in July 2021 against Rs 13.46 lakh crore a year ago, indicating that banks have disbursed approximately Rs 120,000 crore as home loans during the 12-month despite the uncertainties created by the Covid pandemic. The home loan segment is considered to be the safest area for bank loans with minimum non-performing assets.

The Punjab National Bank (PNB) reduced the pension-based lending rate by 25 basis points (bps) to 6.55%. It revised the Pension Indexed Loan Rate (RLLR) from 6.80% to 6.55%, effective September 17. The bank also announced that it is offering complementary home loans at an attractive interest rate to existing balance transfers and balance. case. PNB already offers full service fee / processing fee waiver on home loans, auto loans, personal loans, retirement loans, myProperty loans and gold loans as part of its bonanza offering from festival, he said.

Kotak Mahindra Bank kicked off the holiday season by announcing that it has further reduced interest rates on its home loans by an additional 15 basis points from 6.65% to 6 , 50%. Bank of Baroda offers a 0.25% exemption from existing applicable rates for home and auto loans. In addition to this, the bank also offers a mortgage processing fee waiver. Mortgage rates will now start at 6.75% and auto loan rates will start at 7.00%.

SBI has removed the distinction between a salaried borrower and a non-salaried borrower. Previously, the rate applicable to a self-employed borrower was 15 basis points higher than the interest rate applicable to a salaried borrower. This would lead to a new interest saving of 15 basis points for non-salaried borrowers.
CS Setty, Managing Director (Retail and Digital Banking), SBI, said: “In general, concessional interest rates are applicable for a loan up to a certain limit and are also related to the profession of borrower. This time, we have made the offers more inclusive and the offers are accessible to all segments of borrowers regardless of the amount of the loan and the profession of the borrower. SBI’s 6.70% mortgage offer is also applicable to balance transfer cases. “We believe zero processing fees and concessional interest rates during the holiday season will make homeownership more affordable,” said Setty.

On falling interest rates, Ambuj Chandna, President of Consumer Assets, Kotak Mahindra Bank said, “As the world has changed and we spend more time at home, our lifestyles have also changed. evolved. People look for comfortable homes where the whole family can work, play and spend quality time together. HDFC and Bajaj Finserv also offer 6.75 percent home loans. Banks and the real estate segment are basing their hopes on the segment’s faster growth as the economy is in recovery mode and the industry has almost returned to pre-pandemic levels. “The mood of homebuyers is pretty positive and this drop in rates will act as a catalyst for faster decisions. With the upcoming holiday season, which is seen as auspicious by many Indians to make expensive purchases, the timing of an interest rate cut couldn’t have been better, ”Amit said. Goyal, CEO of India Sotheby’s International Realty.

Ananta Singh Raghuvanshi, Senior Executive Director of Experion Developers, said: “A lower interest rate regime, competitive pricing and stable supply are key factors this holiday season. We hope other banks will follow suit as well. Besides the attractive lower interest rate scheme, the fact that developers are offering festive programs should help boost real estate sales. For buyers of affordable and mid-range homes, mortgage interest rates are almost as important as real estate rates.

“Cost sensitivity impacts every aspect of their home buying journey, and a reduction in interest rates can be the difference between buying decisions and indecision. The drop in interest rates is likely to coincide with the holiday season. This year there is a lot of pent-up demand waiting to hit the market, ”said Anuj Puri, President of ANAROCK Property Consultants.

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Why Your Credit Score Is So Important When Getting A Personal Loan


The advantage of getting a personal loan is that you can use this money for any reason. If you have credit card debt that you want to pay off more affordably, you can take out a personal loan at a lower interest rate and drop your balances. Or you can take out a personal loan for:

But if you are going to take out a personal loan, it is important that you have a good credit rating when you apply. Here’s why.

Your score could be your most valuable asset

When you take out a mortgage, that home loan is secured by the asset that it is used to finance your home. If you don’t pay off your mortgage, your lender can force the sale of your home in order to be paid off. The same goes for an auto loan. Fall behind on your payments, and your lender can repossess your car and sell it to meet your loan obligation.

However, personal loans work differently. Personal loans are unsecured loans which means that they are not tied to a specific asset. If you don’t pay your personal loans, there is nothing your lender can force you to sell to get their money back.

For this reason, personal lenders can be quite picky about the applicants they approve. And they tend to favor applicants who come in with good credit scores.

The higher your score, the more likely you are to not only get approved, but also get a competitive interest rate on a personal loan. To be clear it is It is possible to qualify for a personal loan if your credit score is not as strong, but you could end up with a high interest rate which makes the loan much less affordable.

How to increase your credit score

If you are looking to apply for a personal loan but are not excited about how your credit score looks, it is worth working on improving it before submitting this application. You can do this in several ways:

  • Pay your bills on time, which will result in a more favorable payment history. Your payment history carries more weight than any other factor in calculating your credit score.
  • Pay off some existing credit card debt. This will lower your credit usage rate, which is another important factor that goes into determining your score. That said, if you are in a situation where you need to take out a personal loan, you may not be able to afford the debt you already have.
  • Check for credit report errors. If there are any mistakes that work against you, correcting them could improve your score quickly.

If you are applying for a personal loan, a good credit score could make it easier to get approved and earn an affordable interest rate. Check your credit score before applying for a personal loan so you don’t be disappointed.

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Home loan: should you repay it or invest if you have a lump sum?

Home loans are generally cheaper than other loans, and repayment terms typically vary from 15 to 20 years.

Since buying a home requires a large amount of money, very few people can buy one with the full down payment, and most homebuyers need to take out a home loan. There are also some advantages to buying a house by taking out a home loan – buyers save money on rent by switching from rented accommodation to owner accommodation and there are also tax advantages on the interest paid on the property. a mortgage and on the repayment of the principal. .

Home loans are generally cheaper than other loans, and repayment terms typically vary from 15 to 20 years. Some financial institutions even offer home loans with a repayment term of 30 years.

Even if mortgage interest rates are lower, the longer the repayment term, the higher the total amount of interest paid will be, even if the amount of the equivalent monthly payment (EMI) will be lower.

For banks and financial institutions, home loans provide long-term stable income for 15 to 30 years.

However, during the long repayment period, if a borrower receives a lump sum or their regular income increases significantly, should the extra money be used to pay off the current home loan or should it be invested elsewhere to generate income? the wealth ?

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The decision to repay or invest should be made on a case-by-case basis.

When to repay

The decision to repay all or part of the loan can be crucial in the following circumstances.

Unstable career

If there is uncertainty about future income due to a lack of stability in the career, it is best to reduce future debts by paying off the mortgage early whenever an opportunity arises.

High EMI amount

In case the amount of EMI is very high compared to monthly income – for example more than 40-50 percent of salary / income – it is better to use a lump sum to reimburse part to reduce the amount of EMI.

When to invest

The decision to invest can be made on the decision to repay based on the following factors.

Low interest rate

Since the interest rates on home loans are generally lower than those on most other loans, there are opportunities to generate a higher return on your investment.

Long term

Since mortgage terms are longer than 15 years, a borrower has the opportunity to invest in long-term instruments like equity and generate a much higher rate of return than the interest rate on a loan. immovable.

Fiscal advantages

Since there are tax benefits up to a limit on mortgage interest and principal repayment, it is better to continue with the repayment schedule to enjoy the benefits rather than paying off in a lump sum. In addition, a lump sum refund would exceed the tax benefit limit in the excess refund year and reduce the scope of future tax benefits.

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