Requirements for a Home Loan Eligibility

Nowadays, there are plenty of options in the field of personal loans that are provided by various banks and other financial organisations. Though the exact eligibility criteria to avail personal loans, varies from bank to bank, there are few common norms followed by many of the money lending organisations.

The basic factors that determine a person's eligibility are age, profession, annual income, credit history and outstanding liabilities at the time of applying for the loan.

Every bank has different home loan eligibility criteria, when it comes to lending money to individuals, so as to properly assess your repayment capacity which is based on your monthly income.

The main concern that banks have is whether or not you will be able to repay the loan on time. The higher the disposable monthly income you carry, the more the amount you will be eligible for. A bank typically assumes that about 55-60 % of your monthly income is available for repayment of the loan. As always, the loan amount depends on the loan interest – tenure rate. Banks normally fix an upper age limit for home loan applicants.

Almost anyone and everyone who wish to buy property and also has the means to repay the loan, is eligible to get a home loan. Every bank has a set of requirements that you need to meet before you can avail the loan. You need to have a stable source of income and have attained a minimum of 21 years of age to be eligible to apply for the loan.

The loan amount you are eligible to receive basically depends upon your net income. The bank usually provides home loans up to 60 times of the individuals gross income. If a person is to take home a salary of Rs 30,000 he may be offered a home loan of not more than Rs 18 Lakh. However, the finality of this decision is definite after weighing several factors.

Settle your Car Debt early with Loan Foreclosure

With the growth of economy and evolution of banking system, purchasing power of individuals seems to have increased significantly. Apart from preferring an improved lifestyle, people are now found pursuing comfort and leisure. Even for a small journey across the city, they now prefer private vehicles over public transport. This approach has substantially increased the demand of cars in the country.

The versatile credit system in the Indian economy allows many banking and non-banking bodies to provide easy loans to borrowers. Taking advantage of this opportunity, many car aspirants have now fulfilled the dream of owning a car. With easy installments and quick documentation processing, borrowing a car loan has become simple.

Yet many people don't like their vehicles lying under the burden of loan installments for a long time. For them, financial bodies like Magma are providing special loan-foreclosure or prepayment facility on car loans. The following sections will talk about foreclosure, its benefits and its charges.

What is Foreclosure or Prepayment?

Foreclosure means paying off the entire loan before time, without following the installment schedule. Whenever a loan is foreclosed, the borrower does not have to pay the extra interest, which would otherwise be retracted through the installments.

Benefits of this facility

Car loans are usually secured by keeping the vehicle as collateral. On pre-paying the loan, you get full ownership of the car, and can readily sell it or transfer it to someone, without having to consult the bank. Moreover, you need not have to worry about fluctuating car loan interest rates that are generally linked with floating-rate loans.

Procedure and Charges

For initiating the pre-payment process, the borrower needs to approach the bank personally. Many banks and NBFCs like Magma do not allow foreclosure for 6 months from the date of availing a car loan. After the 6 months span, 5% of the total outstanding amount is to be paid as pre-payment penalty. Nevertheless, this penalty is comparatively lower than the impending interest, which you would otherwise pay on installments.

So, avoid keeping your ride as collateral, go ahead and release it with loan pre-payment.

Applying for Business Loans in India

Loans are extremely popular financing methods which are used for various purposes. It could be to purchase a car, a home, personal reasons, educational purposes, for gold, against insurance policies, against bank fixed deposits, from PPF or EPF, against shares or mutual funds or even for marriage purposes. So, what if you are a young, budding entrepreneur and want to start up a business?

Well, there's good news for you! There are financing options for that as well. Known as 'business loans’, these financing options are similar to other types, only the intent is different. They are taken for the purpose of starting up a new business venture or even to purchase an already existing business or also bring in funds to an existing business to finance its current and future business activity.

It is easy to read about these business loans in India online by visiting the bank or financial institute’s website. One can also get instant online approval as well. There is no need for any guarantor for this process.  All a person has to do is fill in their personal details online such as their first, middle and last name, residence city, mobile number, PAN card number, date of birth and email ID.

After they fill in all the necessary details in the online application form, the bank will verify the data. Banks will pay attention to all the possible factors, even one’s credit score before approving the same. They would also require a business plan, which will demonstrate one’s ability to repay the amount.  

After submitting all the required information there are also certain essential financial documents that are required, besides merely providing information. Banks also want to see hard copies of your PAN card, identity proof, address proof, bank statement of the past 6 months, voters ID card, driving licence, projection of future operations and any other if required. Only after all of the above has been approved will the bank issue the same.

One of the most important and common of these is the SME loan. They are taken for small and medium sized enterprises. These financing options are known to form a major chunk of the general business finance market. They can be taken for many different purposes; working capital requirement, new purchases, expansions, vendor and dealer financing, bill discounting, etc.

Researching about these products and making oneself aware about the features offered for the same is very important. One should also compare the procedure from different banks as well. Only after comparing different banks should one make a decision where they want to obtain their loan.

Commercial Vehicle Loans: Essential Financial Options for these Vehicles

Being one-third the size of the United States, India is known to be the second most populous nation in the world; after the People's Republic of China. Comprising of twenty-eight states and seven union territories, India is also one of the emerging economies in the world. However, a large segment of the population belongs to the middle class and many; sadly live below the poverty line. Public transport is thus extremely important in this country for all strata's of the society, i.e. the importance of commercial vehicles in the country is extremely vital for the economy of the nation.

So, what are commercial vehicles or in other words which automobiles can actually be included in this segment? Every mode of public transport; be it bus, taxicabs, vans, light or heavy commercial vehicles, semi-truck, box trucks, vans, coaches and trains are all included in this segment. Besides this, various vehicles that are used for farming purposes such as plough, tractor’s and harvesters are also included in this segment.

India is known for being the world's largest three-wheeler, third-largest light commercial vehicles, second-largest two-wheeler and heavy commercial vehicles. So, financing these vehicles is of utmost importance in the country. There are a large number of leading finance companies (Banks and Non-Banking Financial Companies -NBFCs) in India where one can get commercial vehicle loans for an entire variety of these vehicles.

Most of these financiers have a Pan-India presence and offer their services online for people to read about the financing option, eligibility and even avail online for the same. Some of the providers include banks such as HDFC Bank, ICICI Bank, State Bank of India, Citibank Kotak Mahindra Prime Limited (KMPL), etc. There are also many public sector banks offering these financing options such as Union Bank of India, Dena Bank and Indian bank. Some of the popular NBFCs include Magma Fincorp, Mahindra Finance etc.

These may include finance for auto rickshaws, three wheelers, multi utility vehicles, pick-up trucks, light, medium and heavy commercial vehicles, container trucks, buses which include both passenger and school buses, and trailers.

One of the most important factors that need to be paid attention to when availing these loans is the interest rates that are charged. In today’s time and age, where these financial options can easily be applied for online, there are competitive rates in the loan segment for commercial vehicles. Magma car loans are offered at interest rates that range from 12% to 16%; depending on a variety of factors. Many banks offer interest rates that range from 10 % to 20% (depending on the type of car it is – new or used).

A Guide to Monthly Income Plan

Diversifying one's investment portfolio is one of the most important factors to assure steady growth and accretion of profits. No single financial instrument is enough for an investor to allocate his funds.

MIP's, also known as Monthly Income Plans are hybrid instruments which invest one's funds (a small portion) in equities, while the remaining is invested in money market and debt instruments.

Many investors are under the assumption that a term insurance plan would be the best option; (if some misfortune was to occur) to help a person, in case their regular source of income suffers. However, this is not true. A term insurance plan will pay a lump sum in case of any disability or death of the person, which is most often quickly exhausted as it is used to meet the immediate family expenses.

There will be no future funds available for the family once this amount is exhausted. However, for MIP’s they involve the payment of funds to the family member/nominee as a 'fixed, monthly' income for a much longer period of time. This period can even go up to as many as 25 years. Thus, MIP's are most suitable for those people who want to rest assured with an alternative source of income (as a backup) for their regular income. It also works well for those people who retire and are seeking a guaranteed source of monthly income.

So, how do MIP's actually work?

Well, the policyholder will have to pay the premium amount on a regular basis to the company, throughout the premium payment term. At the end of this period, if the policyholder is yet alive, he will get a regular monthly income amount that is payable to him/her until the end of the policy tenure.  As soon as the policy tenure ends, then the insured will get a terminal bonus as well as simple reversionary bonus. The monthly income stops with the payment of these bonuses.

On the other hand, if the policy holder dies during the policy term than his/her nominee will be entitled to receive the regular, monthly income and premiums paid by the insured till his/her death. Once the tenure has ended, the nominee will receive the terminal bonus and simple reversionary bonus.

By opting for MIP's gives a person, a win-win situation. The insured will either get the survival benefit or the death benefit (as the situation may be).

Car Insurance: An Important Component of General Insurance

Ensuring one's financial security is one of the most important things that any person needs to do in their lifetime. Whether it is for their life or for the various items that they possess, financial security is an absolutely essential component of protecting one's future. Other than life insurance plans which are available, many other types of policies are also bought on a large scale.

They fall under the category of general insurance, protection for all the non-life items in one's life. This may include health, car, travel, two-wheeler, car and home insurance. Purchasing one's vehicle is one of the biggest investments that can be made during one’s life. It may be a first, or a second or even a third vehicle. It doesn't matter, how many vehicles you have, you will always need to financially protect yourself from any sort of accident that may occur or inevitable event from occurring leaving behind a vast financial liability on the person.

Car insurance, also known as vehicle insurance is one of the best ways by which you can not only protect yourself from incurring any sort of financial loss in case an accident occurs, but also to provide third party coverage (liability) as well. There are different car insurance plans that are available in India to choose from at various prices. They may be simple and third party plus theft policies, comprehensive plans or even third party plans. They may be available for commercial vehicles or private cars (passenger carrying vehicles).

They provide coverage for various accidents such as outbreak of fire or burglary. It is easy to read about the features of commercial motor vehicle insurance policies and private car package (insurance) policies online via the websites of bank or Non-Banking Financial Corporations (NFBCs). One can contact the company, providing their email address and mobile number so that a representative can contact them in future.

In addition to this, other key information that may be requested, include the city where one resides is also required when applying for the policy online. Once one has finalized on the policy, they have to enter certain additional details and vital information about the make of the car, its model, whether it runs on petrol or diesel and year of manufacture.

Home Loan Products: Available at Just a Click!

Loans are available for a wide variety of purposes. It could be to finance your new car, for educational purposes, for purchasing a new home, for purchasing commercial vehicles, etc. There are many banking institutes and Non-bank financial companies (NBFCs) which are known to offer various types of financing options for people to make use of.

Usually, purchasing your first house is often one of the biggest investment decisions that you will make in your life. However, you may not have sufficient funds, at such a time and may often depend on various financial options for such purposes. Here, is where banks and other non-bank financial companies come into the picture.

Housing loans or home loans are the most ideal financing option for people who want to buy a new house or renovate it. There are many different home loan products that are available in the market. Some of the popular ones include 'home purchase loans', 'home construction loans', 'home extension loans' and 'home improvement loans'. All of these products are available to meet the various requirements of people.

Most of the banks and NBFCs which offer these loans have a pan India branch network. They offer a robust service delivery model, i.e. they offer door to door services thereby ensuring easy and quick approval of the loans. Besides this, they are known to offer a variety of repayment options, which are also known to be flexible.

It is very easy to apply for these loans online, where people can download the application forms from the bank's or NBFC's website. Here, they can read about the features of the various home loan products.

Moreover, there are plenty of portals that are available online where people can compare the products offered by these banks and NBFCs, where they can compare their interest rates. This way, they get a deeper insight as to what is available in the market and can make a far more informed decision.

 Many of the websites belonging to these banks and NBFCs have a set of frequently asked questions, which people can read through so as to understand the loan process. Besides this, they can also find out the essential documents that are required, terms and conditions and the various options which are available for NRIs residing in the country.

While NBFCs are regulated by the NHB (National Housing Bank), they are exempted from the requirement of registration by the Reserve Bank of India (RBI). On the contrary, the RBI serves as the primary regulatory and supervisory body for all the banks in India.