Archive for the 'Home Loan' Category
July 31st, 2009 -- Posted in Home Loan |
Loans have pushed the stalled growth levels in past and if used properly can help the Indian economy to emerge from the state of chaos.
Demand for loan products in recent times, thanks to neutralising recessionary waves, has taken a sound beating. With liquidity levels in the economy still below the required mark, getting and disbursing any kind of loan product for any party (whether lender or borrower) is becoming a big deal with every passing day.
Talk about personal loan products and readers will be astonished to know that before recession hit the shores of Indian economy, the conversion rate for every 100 personal loan pleas was 70-85 (a huge rate indeed). Meaning, that out of every 100 requests for personal loan products, 70-85 were accepted by the lending authorities which primarily comprised of banking institutions.
But the situation no longer exists. Presently, hardly 5-10 applications for personal loan are accepted by the lending organisations in every 100. Reason, well quite obvious, liquidity has been a rare thing for them (lenders) and with increasing bankruptcies and defaults, things have gone from bad to worse. Moreover with government tightening noose around the bank’s neck for not recovering the outstanding payments from defaulters through illegal means (recovery agents, threats etc), cash volumes with the bank have dropped radically.
If that was about personal loans, situation of home loan is no better either. Due to their direct association with real estate, which too has bore the brunt at the hands of recession, lending trend has slumped significantly. Although Indian government’s pro-active measures has done a lot of damage-control but then situation is far from the same ‘booming’ as it was a year and a half back. However, with chief government driven banking authorities slashing and freezing down the lending rates for the time being, green shoots have started to emerge which indeed is a good sign. Taking the cue from their public-sector counterparts, private banking players too have stepped forward with the initiative of offering the home loan products at trimmed rates.
In the above-mentioned situations it was the organisations that were at the losing end. But in case of loans against property, situation is a bit different.
As told above, someone and a half year back, property rates across the Indian democracy rocketed to sky-high in an abnormal way. What followed next was the sudden emergence of the real estate sector as a prominent contributor component to the Indian economy. However, a slump was evident just like in stock market after witnessing a brief surge in the initial phase. Hence, when the time was good, procuring a lump-sum credit deal under the ‘loan against property’ head was easy. But when situation started depleting, getting a loan against property started proving to be a tough nut to crack. The circumstances are more or less same but then people are sitting along the coast, waiting to see sea getting calm down.
If one takes an overview and is asked to deliver a judge mental remark, he or she might not reach to one definite conclusion but then as said above green-shoots have started to emerge and one can sincerely hope that it is the time for Indian loan industry to bounce back thus, bailing the entire banking and lending industry out of the turmoil.
May 23rd, 2008 -- Posted in Home Loan |
Are you in need of financial resources in order to start or even maintain your small business? Most of us are. The first step is to take a look at the vast number of commercial loan sources that offer help in this area such as Chase, Citibank, etc. Also, with the Small Business Administration (SBA), you should be able to arrange a connection with one of these banks. This is one of many organizations that specialize in loans to small businesses.
Contrary to the belief that bankers actually look for reasons to turn down prospective clients in need of a loan, they are in the business to lend money. This means that every time a banker is sitting in front of a potential client, they are hoping to make the deal work just as much, if not more than the client wants it to work.
A bank?s primary role in the small business lending area is funding growth. An example of this would be to finance the expansion of small business with a proven track record. Most banks can offer a wide variety of loan packages designed to finance expansion of an already existing small business.
Below are a few examples bank loan packages:
1. Asset Based Financing. Asset Based Financing is a general term describing a transaction whereby a lender accepts collateral and assets of a company in exchange for a loan. Most asset based loans are collateral against other accounts receivable, inventory, or equipment. Accounts receivable is the most favored of the three because it can be converted into cash quickly. Banks will only advance funds on a percentage of receivable or inventory, typically being around 75% of the receivable and 50% inventory.
2. Line of Credit. A line of credit involves the bank?s setting aside designated funds for the business to draw against for the cash it needs. As the line of credit is used, the credit line is reduced and when payments are made the line is replenished. One major advantage of a line of credit is that no interest is accrued unless the funds are actually used.
3. Floor Planning. Floor Planning is another form of asset based lending in which the borrower?s inventory is used as collateral for the loan. Car dealerships are a prime example of a business that often uses floor planning as their primary financial tool.For More Free Resources visit www.greatindustrialguide.com
Source: setting business goals
February 13th, 2008 -- Posted in Home Loan |
Home loans make the process of buying a new home more affordable than ever. As you may already know, these types of loans give you many opportunities that wouldn’t be possible without them. When you buy a home, you should understand as much as you can about the process, as well as the questions you will be answering. This way, you’ll be familiar with how things work and you’ll find the entire process to go much smoother.
When you look towards a home purchase loan, you’ll need to fully understand the interest rates. They are never the same and will vary among the different banks, as well as from time to time. In many cases, home loans can change on a frequent basis, with little to no notice. When you buy a home, it is very important that you keep up with the economy. Any change in interest rates for a home loan can either increase or decrease the amount you pay back.
When getting a home loan, you’ll also need to understand the terms and the length of the loan. Almost all the banks and lenders have a variety of different plans or periods for you to choose from. If you choose a longer period, in most cases your interest rate will drop. You can find this out yourself by using a mortgage calculator. This way, you’ll know how much your mortgage payment will be before you decide to further pursue the loan.
As you probably already know, your ability to pay the loan back is very important. Some banks require that you keep your loan full term, while others may provide you with the option to pay it off any time you wish. Home loans that give you the option to pay it off early will normally save you quite a bit of money in the end. If you are able to pay your loan off several years early, you’ll save a lot of money in the long run.
Even though the early payoff option is great to have, it can also come back to haunt you if you end up defaulting on the home loan. Or, if you decide to sell your home in the future, the early payoff can haunt you as well. For those very reasons you should always consult with a specialist before you commit to any type of home loan.
For the potential home buyer, home loans offer several different opportunities. Before you rush out and get a home loan, you should always know what you are agreeing to. You should also look into the company you are thinking of getting the loan from as well, so that you can better prepare yourself when you go through their process of getting your loan.