|
Housing finance simplified using advanced calculators to find
the lowest EMI loans. Compare Housing
Finance Companies and interest rates in India.
We strongly recommend that you Walk
through the Loan Taking Process with
us. |
| |
|
Special schemes :::::: |
| Interest rates fall to 7.25%
p.a. for 15 year loans.They are expected to rise by
0.5% by year end. Go for Fixed rate products only.
 IDBI Home Finance :
Special Scheme
for Age above 50 Years Clients , Called 50 Plus
Scheme
Canfin Homes :
Floating rate loans
launched, special schemes for good quality, credit worthy
customers.
HDFC : Has
launched a monthly rest product. Free Credit Card, Life Cover
at at discount. HDFC has Special Spot Sanction Scheme till
31-mar-2005..
HUDCO : Floating rate loans
launched
LIC Hsg Finance :
Floating rate
loans launched
SBI :
Processing fee 0%, Admin fee 0% and prepayment fee of 0%
|
|
Budget 2003 - Impact on Home Loans::::
The
current Budget has extended the same tax benefits as that for 2002
for one more year. Upto Rs.150000/- of interest repaid each year
towards servicing a home loan can now be set off against taxable
income. Further, upto Rs. 20000 per annum can be availed under
Section 88 for principal repayments made each year. Section 88 is
now available to only those who have a taxable income less than Rs.
500000. These benefits will accrue to all those who purchase a home
before 31st March, 2004. These tax benefits are available only for
the first house provided the same is self occupied before 31st
March, 2004. In order to claim the full benefit you may have to
choose the appropriate tenure of the loan so that in later years you
will still get large tax savings despite the interest repayment
component of your tot EMI payments getting progressively reduced.
Use the Tax Savings Tool (on the left) to ascertain the proper
tenure of the loan you must take to minimise your post tax cost of
the loan. If you have already taken a loan, it could be useful to
refinance the same today at a lower interest rate and a higher
tenure using the Refinance Tool. |
|
Interest
rates to head lower over the year::::
Interest
rates in India are clearly heading lower with the RBI announcing
repo rate and bank savings rate cuts after the Budget 2003. In
keeping with this trend, all housing finance companies have dropped
rates to the lowest in the last several years. It is expected that
interest rates will further go down over a period of atleast the
next 6-12 months.
The supply of money in the economy continues to be in excess of
demand. The recent inflow of dollars through the India Millennium
Deposits raised by the government has ensured that India has a
comfortable $75 bn. plus of forex reserves. The improving trade
deficit as oil prices come down and software export continue to boom
will also increase money supply over the next 12 months. However,
the industrial demand for money continues to be poor given the poor
performance of the domestic industrial sector. In this scenario,
banks are bound to lend at lower and lower interest rates. Further
it is in the interest of the government to lower interest rates in
the economy as they are the largest borrowers of funds in the debt
markets today. There is only one way that interest rates can go and
that is down.
Take only Floating rate loans (that have their interest rest
periodically) as of now! Check back with this website frequently and
we will tell you when to switch your Floating rate loan to a Fixed
rate home loan and save money. |
|
Do not lock into a Fixed rate loan::::
In an
falling interest rate scenario you would be better of taking a
Floating rate loan as the interest rate will get reset to a lower
rate periodically. Even if you must take a fixed rate loan due to an
attractive interest rate offer, take it from a bank that has no
prepayment penalty. Most lenders charges upto 2% of the loan amount
as a prepayment penalty for a FULL repayment of the loan. ( others
permit part payment of the loan with no penalty).
Further, please check with the bank as to how frequently they pass
on the benefit of falling interest rates to old customers. Some
public sector banks do so only once in 12 months while some private
sector lenders do it as frequently as a quater. Though the current
itnerst rate quote maybe lower, over the life of the loan, you will
save more in the case of a lender who resets your floating rate more
frequently.
If you think that rates will increase at any point of time in the
future, you can always use our refinance module to prepay the old
loan and lock into a fixed rate loan. Please check with this website
frequently to decide when to refinance an earlier loan. |
|
The issue of Stamp Duty on Registered Mortgage Deed::::
Normally
the lenders will ask you to create a registered mortgage deed on the
property which they will retain with them as a security against your
loan. As this is a legal document, the prevalent stamp duty needs to
be paid to the State Govt. In the state of Maharastra, this duty is
about Rs. 5000 for a loan below Rs 5 lacs and about Rs. 35000 for a
loan above Rs 20 lacs. Some lenders like HDFC do not ask for the
Registered Mortgage Deed but only take the original Title Papers of
the property as a security. Thus customers of HDFC do not pay the
stamp duty to the respective State Governments.
Some States have taken this matter to court as they are losing
revenue. Some of the lower courts have ruled in favour of the State
Governments and asked HDFC to make good the Stamp Duty for all past
customers along with interest. The matter is now pending with the
Supreme Court. We feel that the ruling will again go in favour of
the States. We are not sure if HDFC would be asked to pay up a large
amount along with interest, which may ultimately be passed on the
the existing customers. Any new customers going to such lenders must
be aware of the risk of a legal ruling that may result in a future
cash payment along with interest. |
|
Flexible Loan Repayments::::
If you
are a salaried employee, banks look at your current salaries while
deciding how much they can lend you. The fact is that your salary
can only increase as time goes by and your ability to repay larger
loan amounts will only get better. Some banks now offer a flexible
repayment plan that allows you to pay larger portions of the loan in
the later years. Your initial monthly payments are kept low. IDBI
Bank, HSBC and Citibank offer Flexi repayment option loans. To read
more about this click below.
Flexi repayment loans are now available |
|
|
Disclaimer: The data on interest rates as well as loan product
availability presented here are updated regularly. Please recheck
the rates with the respective companies before finally deciding to
take a loan from one of them. We do not guarantee any of the rates
offered but merely provides you with important tools to compare and
locate a loan of your choice. |
|
