Choose the Best Deals this Diwali for urself

Previous couple of months has been tough for seller and customers due to high interest rates. But with festive season round the corner, festival season is considered auspicious for shopping, which means there will be more buyers.
Special Discounts and offers this diwali–
Discounts available during the festive season
• Buy Any products on Easy EMI’s Options.
• 0% processing Fees on loans and other goods.
• Get Cash Discounts on any purchase.
• Offers on Electronics Goods, Foods, Sweets Etc.
• Reliance Retail, Big Bazaar and Malls offers Discounts on hosted things.
• 0% Interest Rate on Credit Card EMI’s. (*Conditions Apply)
• Banks Charges Low Interest Rates and 0% processing fees on Home, Car and Personal loan to woo Customers.
Finally, But use credit card judiciously. Credit card is not free money but the most expensive money

Tornado Clouds dim Indian Economy

I have just returned home after three weeks of travel. And while it was exciting and eye-opening, it has also been grueling and exhausting. The last leg of my trip took me to Chennai in India.
I have often written to you about how India is booming and galloping along. And while that is true, I have noticed a distinct flaw in the armor now. India is slowing down at a rapid pace. We see that in the industrial production (IP) numbers, we see that in the slowing capital investments and we see that in the overall GDP numbers.
What is rescuing India today is the very healthy monsoon season that has just concluded in September. As I have mentioned a fair bit (about 33 %) of India’s GDP is dependent on monsoons. And we have had a few years of excellent monsoons here. That is holding up the Indian GDP above the 7.5 % or higher.
The industrial side of the equation has been hit hard by the relentless pressure of interest rate hikes by the Reserve Bank of India (RBI).
Property markets have hit a plateau, if not in slight decline. Even the CD rates have peaked and each incremental raise in rates does not translate into higher savings.
New home loans are running at 12 % and car loan can range 15 % or higher. It is no surprise that new car sales are struggling and home prices are in decline. And despite the pleas of the business community, the RBI stands steadfast in its attempts to crush inflation.
The twin deficits (trade and fiscal) are beginning to get worrisome and I can see the perfect storm developing for India. Despite the Indian rupee not being fully convertible, India is particularly sensitive to the global cues. The world seems to be descending into the second recession (if you can call the recovery a real recovery). And the risk aversion that has gripped the markets has hit India hard.
The Indian rupee has dropped by nearly 15 % in two months. The stock market has also seen enormous amounts of outflows by the Foreign Institutional Investors (FII). Dalal Street has narrowly escaped bear market territory, having declined by 19.5 % during the past three months.
And I do not believe we have seen the worst of it yet. If Europe continues to dilly dally, we will see the euro take another dive. And it will take the Indian rupee and Dalal Street with it.
What frustrates me is that India trades with Europe as others do, but is not directly affected significantly by the European slowdown. It is the market sentiment that is driving the market in frenzied moves.
While in the longer run, India will offer its investments at highly discounted rates, at this time, I would be sitting on the sidelines in cash.
This is actually a good time to send U.S. dollars into India awaiting the next leg up. Cash accounts can earn up to 6.5 % while waiting for the right moment to enter the markets.
I am taking advantage of this pause and sitting on the sidelines with the surplus cash. I have not completely exited the markets and have some long term value investments on the books. But cash allocation is significant portion of my portfolio today.
I do not believe India is down for good. It is pause waiting for the world to calm down a bit. A cooling down period if you want to call it that.
Today’s news of Slovakia holding Europe and Euro to ransom does not help any cause. But of France and Germany can get their act together before the end of October, we may have an incredible Christmas in India.
Source: Moneynews

Get a loan against the rent you are yet to receive

If you have rented out a property to an individual or a company, it can come handy during an emergency. You can get a loan against the rent you are yet to receive in the future from your tenant. Such a loan would be cheaper than a personal loan and your tenant will pay the equated monthly
Installments on your behalf. While most banks provide loans against rent receivables only if property is rented out to reputed firms and banks, some banks such as Indian Overseas Bank and UCO Bank provide a loan even if the premise is rented out to individuals.

Loan features
How much do they provide? Banks provide loans in the range of `50,000 to a few crores. The amount you can avail depends upon the quantum of future rental income that you would receive in keeping with the tenor of the lease.
Repayment tenor: This could be as high as 10 years depending on the lease tenor as well as your repaying capacity.
The cost: The rate of interest varies between banks but in general it is 50-100 basis points less than that charged on personal loans. You also need to pay processing fees which again varies from bank to bank and depends on the loan amount.

THE DOCUMENTATION
Normally, a bank enters into a tripartite agreement with you and your tenant, whereby the tenant agrees to pay the rent directly to the bank. The bank also signs a separate term-loan agreement with you. You would be required to submit a few documents including the tenancy agreement, authorized building plan, title deed of the property, your bank statements , I-T returns and PAN number.

Teaser loans: SBI for talking it out with RBI

Seeking to temper the highly charged-up discourse on the teaser loans and the bank's confrontational approach with the RBI, newly-appointed SBI Chairman Pratip Chaudhuri today said the bank will "engage" with the central bank to lower the higher-than-comfortable provisioning requirement.
"The current provisioning requirement of 2 % (on teaser loans) is a bit difficult for the bank when compared with the earlier 0.40 %," Chaudhuri said at his first media interaction at the bank headquarters this evening.
State Bank of India will "engage with the central bank" to solve the issue, as it does not want to take a belligerent stance against the regulator, he said.
"The current product offers enormous value to the customers, it has helped millions to own homes...as a final settlement we would like to have something which delivers value to the customers and also takes care of the regulatory concerns," he said.
Fearing troubles in repayment, RBI had increased the statutory provision coverage by five times to 2 % on the teaser loans -- launched first by SBI in days of high liquidity -- in the November policy review.
Click to Apply for SBI Home Loan
SBI's peers, which after being critical initially had launched their own teaser rate products, have since then discontinued the offering while the nation's largest lender has persisted with the product.

Use credit cards elegantly

A characteristic free credit period in India is 45-51 days. If you pay off the dues within this period, the interest is saved. If in case you are unable to pay off the entire amount within the due date, a common practice is rolling over the dues after paying the minimum amount. This could be expensive as you would have to pay an interest of about 3 % per month and the new purchases made will not get any interest-free period until the dues are completely settled. So, here’s a quick look over the other schemes offered by card companies to clear off credit card bills.
Balance transfer
If you opt for Balance Transfer, you can transfer the outstanding balance from one card to another, and thereby extend the repayment period.
Process
A balance transfer can take place between any two banks. The process takes 7-10 working days with a processing fee, and a maximum of 2 % will be levied.
Low interest rates or sometimes zero interest rates are available for balance transfers.
Points to be taken care of
Check for hidden charges or if the bank charges a transfer fee in addition to the processing fee.
The low interest rates the banks offer on balance transfers may be for an introductory period and once this period is over, it may return to the normal rates.
It is important to note that the credit limit of the card on which your new due is, will be reduced proportionately. Also remember that the balance transfer amount will be limited to a maximum 80 % of your credit limit.
EMIs on credit card loans
If you are having a problem in paying the entire credit card bill at one go, a good option is to convert it into EMIs. This facility is similar to a personal loan. But here, unlike personal loan there is no paper work and no waiting for approvals either.
Another advantage here is that you need to pay a lower interest rate of about 1.5 to 2 % whereas the normal credit card rollover interest rate is higher than 3 %. Also, while this scheme is running, one still gets the interest-free period on new purchases.

Basix gets 100 crore loan on personal guarantees of directors

In a first of its kind loan transaction in the troubled microfinance segment, public sector Central Bank of India has sanctioned a `100 crore loan to Bhartiya Samruddhi Finance Ltd (BSFL), the flagship company of the Basix group, against personal guarantees of its directors, including group chairman Vijay Mahajan.
According to Basix’s website, it has nine other directors on its board. The loan is yet to be disbursed.
Mahajan, 56, who is also the president of micro-lending industry body, microfinance institutions network (Mfin), and is currently undertaking a Shodh Yatra, a nationwide tour to “extended grassroots enquiry into the lives and livelihoods of poor people”, confirmed the development but said it may not necessary for Basix to avail of the loan as a bank consortium, led by Small Industries Development Bank of India (Sidbi), is looking into a `650 crore recast of the firm’s debt.
“The bank has sanctioned the loan for Basix. We are exploring the possibility of obtaining personal guarantees from MFIs against loans,” a Central Bank of India official said. He declined to be named as he is not authorized to talk to media.
BSFL is the fifth largest MFI in India, with around two million borrowers in Andhra Pradesh, Maharashtra and Orissa. It has a total personal loan outstanding of around `1,800 crore.
This is the first such loan that an Indian bank is extending to any microfinancier in the country after the industry plunged into an operational crisis in mid-October, when Andhra Pradesh, the fifth largest state in India accounting for at least one-fourth of country’s micro-lending industry, enacted a law to put an end to alleged coercive methods resorted to by some micro-lenders to recover loan dues from poor borrowers.
Officials of micro-lending industry said if banks insist for personal guarantees or any other sort of high collateral requirements, it would be extremely difficult for small MFIs to secure adequate bank finance to run their operations.
“No bank has entertained our requests for fresh loan ever since the crisis happened. What can I do if they seek guarantees worth `10-50 crore when my net worth will be far less than that?” asked the head of a Hyderabad-based MFI, who did not want to be named.
The budget for 2012 has proposed to create a `100 crore equity fund with Sidbi to help smaller MFIs survive when banks are not forthcoming to offer them loans. Indian banks, including Sidbi, have lent around `14,000 crore to microfinance institutions as on 31 March 2010, according to data from National Bank for Agriculture and Rural Development.
But since October, fresh lending has happened to few companies that have operations outside Andhra Pradesh.
The Andhra Pradesh law banned micro-lenders from giving a second loan to a borrower without prior government approval and made monthly collection mandatory for such firms instead of weekly or daily collections. This resulted in a sharp fall in the collection of loan instalments from borrowers, promoted banks to stay away from lending fresh loans to MFIs and forced micro-lenders not to give any new loans to their borrowers.
The Reserve Bank of India and (RBI) finance ministry stepped in to resolve the issues in the sector that is vital for financial inclusion of rural poor.
An RBI committee, chaired by Y.H. Malegam, had recently proposed a cap of 24% for MFIs and a margin cap of 10% for large ones, besides making it compulsory that not more than two MFIs can lend to the same individual.
RBI also asked banks to continue holding on operations to the sector by recycling loans to MFIs to the extent of recovery and resume lending, with a view to assist the ailing industry tide over the current crisis phase. But there are not many takers for the regulator’s call.
Perturbed by the regulatory uncertainty in the sector, some banks are now demanding higher credit enhancements in the form of cash collateral, personal guarantees and other securities such as land assets from MFIs for new loans and even to buy securitized portfolios.

Tips for get a low rate personal loans

Personal loans are handy when you are in a spot and need some urgent cash. However, personal loan are tricky and you need to know as much as possible about their basics before applying for one.
Before you choose your personal loan:
Calculate the inexpensive loan offer: Personal loans come with very high interest rates ranging from 14% to 24%. Compare personal loan interest rates and get the complete picture by understanding the annualized interest rates for each offer.
Then figure out the total amount of repayment you need to shell out with all the offers before opting for the loan of your choice.
Processing fee et al: You need to keep in mind the processing fee and other fees that will be levied when you apply for your personal loan.
Prepayment penalty check: Ask upfront if there would be any penalty payments for prepayment of the loan at any point in time. More often than not loan consumers tend to pay up their loans earlier than planned to be rid of debt. Hence, its important to know if your personal loan offer allows part prepayments.
If that is the case, then you should be aware from what time frame in the loan period you can start prepaying and understand the cost you incur due to such prepayments in part or full.
EMI and tenure: Evaluate all loan offers. The first condition for loan offer selection is the total money outflow that the loan will cost. The second factor is the EMI. A loan offer with a lower EMI and a longer tenure may seem attractive, as it could be easy on your purse strings, however not all such loans prove to be cost effective in the long run.
Hence, first calculate the total loan cost and then try to opt for a higher EMI, which you can comfortably manage to enable shorter loan tenure.