Tuesday, September 10, 2013

Switch your loan now!

Contrary to what the ET says I would like to present my view regarding why one should switch to a new lender in the current market situation. 

Whenever there is a high interest regime, the spread tend to be low i.e. interest rates move closer to the base rates. 
e.g. Axis Bank and BOB are offering home loans at the base rate (0 spread). Most other banks are also maintaining the spread for new customers at the minimum for roughly the following two reasons. 
1. They have to structure the final (base rate + spread) interest rates competitively, so there is a limitation on the likelihood of increased base rate. 
2. With high cost of funds, the reduction in base rate is already ruled out. 

As a result, the only sane option left for them is to move the base rate and the final interest rate as close as possible!

Therefore when you switch now, you will stand to gain in the long term. Whenever interest rates crash, you will automatically benefit as you have very less or even 0 spread. 

Don't hesitate to switch your home loan now!

Thursday, March 28, 2013

HDFC reduces RPLR to 16.40%

HDFC has done a great favour to its customers last month by reducing the RPLR from 16.50 to 16.40, i.e. a huge drop of 0.1%. 

Even the existing customers will benefit with this significant move. 

I request the readers to post their would-be savings (I'm sure it must be in multiples of lakhs and crores) with the revised interest rates. 

Thank you HDFC. 

Tuesday, March 26, 2013

Paypal Charging $1 and $1.95?

Those who add a new credit card to paypal will notice that actually the following two transactions take place on your card. 

a) $1 immediately once you add a card
b) $1.95 when you "verify" your credit card

But don't worry, the $1 transaction is canceled after some time (In my case i got the cancellation sms right after the card verification). 
And the $1.95 will be credited back to your card account in couple of working days after you enter the verification code. 

Generally there are misconceptions regarding paypal and people are reluctant to use it. Paypal is also responsible for their bad reputation as in many cases it's very difficult to reach them. (I remember having to call them multiple times over phone using gmail's call phone feature with proxy US IP ;-))

These things apart, you can buy using paypal with confidence once you know what you are doing. 

Thursday, February 28, 2013

Additional 1L deduction for Home Loan buyers!

Source: http://economictimes.indiatimes.com/news/economy/policy/budget-2013-home-loan-borrowers-allowed-additional-deduction-of-rs-1-lakh/articleshow/18725752.cms

Wait.. don't jump with joy if you are an existing home loan customer. 
The additional 1L deduction is applicable to only those who fullfil the following criterias
1. First time home loan
2. Loan amount not above 25L
3. Disbursement during the FY 2013-14

That means if you are an existing customer then forget about any benefit.
Switching to a new borrower will not help either as it will not be considered as a first time loan. (evil laugh)


Saturday, February 9, 2013

Shifted to Axis Bank Power Home Loan

Finally after much deliberations I have actually shifted my loan to Axis Bank. 
The terms of the loan are as below: 

1. Interest rate: 10.25% (Base Rate 10.00 + Spread 0.25)
2. Processing fee: Rs. 5620/-
3. Mortgage charges: ~Rs. 3900/-
4. Other charges: ~Rs. 1700/-
5. Loan tenure: 8 years

It feels good to be out of a discriminatory system (BPLR) and to have moved to the Base Rate.