A research report by Crisil states that the raising interest rates would result in increased equated monthly installments (EMI) of home loan borrowers of about Rs.6000 crore annually. This increase in EMIs coupled with slowdown in economic growth would lead to increased nonperforming assets (NPAs) of the lenders. The uninterrupted hike in policy rates since… Read More »
A long term loan like a home loan is a debt that is part of your budget every month. If you invest too much into it, there might not be adequate funds to manage a huge list of other expenses that will tend to accumulate with time. For eg. You need to make allowances for… Read More »
Shekar had just shifted to Pune and met his long lost friend Manish at the local café. While discussing their personal life, Shekar asked Manish about his house rent. Manish said he was paying Rs 16500/- for a two BHK flat just on the edge of the city.
A fixed payment amount made by a borrower to a lender at a specified date each calendar month is called equated monthly installment or EMI. EMI are used to pay off both interest and principal each month, so that over a specified number of years, the loan is paid off in full. The biggest benefit of an… Read More »
A bank cannot issue a notice to the defaulter until the account of the borrower becomes a non-performing asset, which takes 90 days. To enable recovery of funds lent Banks need to invoke SARFAESI (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interests) Act. This again has a notice period of 60 days.
Saving on the net interest is the significant advantage of prepaying the home loan, other than the fact that you will retain the complete ownership of the house earlier than planned. The longer the loan tenure, the more the interest repaid, hence its best to repay your home loan in the shortest loan tenure possible,… Read More »
Ideally banks offer loan amounts up to a limit of around 50% of your income. This does not mean you should utilize the entire limit available. Keeping EMI repayments within 30-40% of your budget will help you save nearly 30-50% of your income. Money management experts recommend that you should try and save up to… Read More »