Tuesday, December 31, 2019

Can an NRI Take Personal Loan in India?

Yes, NRI’s can take personal loans in India. The NRI personal loans are accessible from various banks in India. No matter what purpose is the loan offer, there are many prominent banks that offer personal loans to NRIs against fixed deposits while private part banks give NRI personal loans that might be unbound. In fact, the personal loans for NRIs are a decent alternative to get speedy financing for diverse prerequisites.

The NRI personal loans are intended to help Indians who are living abroad to profit from the advantages of a personal loan in India. Some of the most famous banks which provide loans for NRI are State Bank of India, HDFC Bank, ICICI Bank, Canara Bank, Axis Bank, Standard Chartered Bank, Citibank, etc.


1. Eligibility: 

  • There are some requirements an NRI is supposed to meet in order to qualify the process of getting a loan. They are:
  • The applicant applying for the loan should be a citizen of India.
  • The applicant must also be at least 21 years of age.
  • It is important for the applicant to be a professional with a consistent salary or to run a business and be self employed.
  • The salary or the income of the applicant should be enough to qualify for the loan.
  • A number of documents which are required to be submitted as a formality.


In addition to all these things, it is possible that there may be some additional criteria dependent on the bank rules. The best to gain a better understanding of all the prerequisites is to go through the website of the bank you’ve chosen and be clear about everything that is required to get a personal loan.


2. Documentation: 

  • Coming to the documents required for NRI loans, the process is pretty simple to get any other personal loan. Salary details and KYC details need to be shown while applying for a loan. If a person is an NRI then reports which affirm the residential status are also important. Other important things are a passport and a VISA of the country the candidate is living in currently. In addition to all these documents, some other important documents are:
  • A photocopy of passport and VISA of the candidate. 
  • A certificate of salary determining the name, date of joining, designation and compensation details in English. 
  • Bank statements of both domestic and International banks throughout the previous half year. 
  • In the event that the candidate isn't accessible in India when the application of loan is submitted, at that point a General Power of Attorney should properly bore witness from the Indian office of the NRI's occupant nation. In the event that the candidate is available in India, the Power of Attorney can be privately legally approved. 
  • A duplicate copy of the appointment letter of NRI just as the contract.


You might be required to present some extra documents, so the best approach is to recheck the formalities of the bank that you have chosen for a personal loan.

3. Personal loans for NRIs: 

There are many banks in India that offer both rupee and foreign currency personal loans to NRIs who have FCNR or NRE term accounts. These personal loans are accessible against the sum in the FCNR or NRE accounts at highly competitive international rates. The loans are usually accessible up to 90% of the sum in the account with each bank having its own maximum limit on personal loan amounts.

4. Some highlights of personal loans are: 

  • The NRI loans have a wide scope of highlights as talked about below:
  • The NRI loans are actually accessible for a higher amount of money. 
  • The rates of interest involved in these loans are pretty competitive.
  • Time frame involved in the reimbursement of these loans ranges between one year to as long as five years.
  • An NRI can get a loan to fulfill almost any purpose.


5. Advantages of NRI loans:

  • The NRI personal loans offer many advantages of quick financing and many other things, for example,
  • Simple financing for individual credit prerequisites. 
  • The loans can be obtained from many other banks of your choice. Each bank has its own rules and advantages.
  • Extremely simple documentation and the application process. 
  • Bother free and quick preparing of all the important applications. 
  • The loans are accessible for both the salaried employees and people who are self employed.

This is a guest post by Shipra Aggarwal

Tuesday, December 24, 2019

6 Tips to Give Your Home a Charming Vintage Look


Planning to redecorate your home and add some vintage charm to it? Well, it doesn’t necessarily need to be expensive, and you don’t have to visit antique stores to get your hands on vintage decor.

Start with things like old frames, metal baskets, old cartons, and suitcases. Paint the rooms right—choose pastel shades like vintage blue, along with shades of silver and gold for that perfect vintage look.

Here are some simple tips to help you give your rented apartment or house a rustic look:

Old-School Mirrors


Go to that storeroom with the half-forgotten trunks full of old hand-me-downs from your great-grandparents. Look for old mirrors, with gold or silver-toned trim on the frames.

You could even buy one of these ornamental mirrors from furniture shops. Once you have a mirror, place it in one of the walls of your living room for the perfect vintage look. This will also serve to make the space look larger and disperse light evenly around the room.

Dishes and Cupboards


You can find antique china dishes at thrift stores and flea markets. These are a great way to add that classic vintage touch to your home. Put on your creative hat and figure out unconventional ways of working them into your decor - hang them on walls or use them as soap dishes or candle holders.

Go for wooden or metallic cupboards that have an antique-looking finish instead of modern clean-cut ones. You can also reuse your old cupboards and paint them from scratch to achieve that   beautiful distressed look.


Ladders


Have an old wooden ladder? Give it a fresh coat of paint and place it in your bathroom or kitchen to be used as a towel or soap rack.





Collectible Curios


Old telephones have a unique charm that’s been lost in modern design. They will fit perfectly into your freshly vintage-themed home. Go to an antique store or shop around online for such these telephones and use them as decor elements.

You could also look for old radios, gramophones, typewriters, and all other little curios that embody the vintage spirit. An antique-looking clock can really tie a room together by acting as the centerpiece.



Speaking or curios—mason jars are versatile and cheap decor elements. You can use them as candle holders or use them to hold lights for a touch of class.

Old Books


The vintage look feels a bit lacking without appropriately old books. There’s something about a stack of old books placed on a coffee, kept company by a vintage lamp.

You can also invest in a bookshelf. Make sure to go for one that has plain rack design and is made of wood. A dull, somewhat distressed finish is preferable. Place hardbound books - old classics - to complete the setting. And of course, these classics make for great reading, so it’s a win-win.

Kitchenware


When every room in the house is getting a vintage makeover, the kitchen can’t be left behind. Make use of bronze, brass, or earthen pots and vessels for a quaint, and functional, look.

These home makeover tips will give you that dream vintage-themed home without putting too much of a strain on your finances.


This is a guest post by Chandni Lal

Wednesday, December 18, 2019

What is the role of municipal corporations in cities and how do they help for harmonious living?

Author: Sachin Gupta | Find me on Twitter

Owning a home is a dream that most individuals and families cherish. Not only it provides for stable shelter, societal acceptance, financial well being, but it also enables easy access to the credit market by working as collateral comfort / security. As per the Census 2011, 31.16 per cent of the total population is in the urban areas. However, owning a home is just one piece of harmonious living in the city of your dream/choice. There are other pieces which provide for the true wholesome living experience in a city. Some of these pieces are civic amenities such as water supply, sewage, drainage, recreational parks, internal roads, maintenance of buildings, etc.

And all of these amenities are provided by the local municipal corporations. Without the proper functioning of these corporations, living in a city would hardly be enjoyable. Even though, private developers are coming up with self sustainable townships that can address some of these issues, but importance of municipal corporations cannot be underestimated. These are government official bodies that provide civic services and administer a city with a population of 200000 or more inhabitants.

Therefore, having the knowledge about these municipal corporations is important in order to make sure that above listed civic amenities are provided continually. In the following table, information about municipal corporations is provided for Indian states and union territories such as West Bengal, Uttar Pradesh, Uttarakhand, Tripura, Tamil Nadu, Sikkim, Rajasthan, Punjab, Puducherry, Orissa, Nagaland, Mizoram, Meghalaya, Manipur, Maharashtra, Madhya Pradesh, Lakshadweep, Kerala, Karnataka, Jharkhand, Jammu and Kashmir, Himachal Pradesh, Haryana, Gujarat, Goa, Delhi, Daman and Diu, Dadra and Nagar Haveli, Chattisgarh, Chandigarh, Bihar, Assam, Arunachal Pradesh, Andhra Pradesh, Andaman and Nicobar Islands.




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Wednesday, December 11, 2019

Cyclical nature of commercial real estate

Author: Sachin Gupta | Find me on Twitter

This post deals with commercial real estate in India. For the last 2 years, one would have noticed that most real estate developers and private equity funds have focused their energies on development of residential real estate across India.

Why did this happen? Why did real estate developers in last 2 years solely focus on residential real estate? Well, the answer lies in global economic slowdown. Due to global economic slowdown, companies started to lay off employees and there was freeze on investment in new projects. And all of this resulted in lack of demand for commercial office space by companies. Due to lack of demand of office space, developers ignored the commercial real estate and that has resulted in tight supply of office space.

And now that, economy is starting to show signs of recovery, there is again demand for office space and therefore it is pushing up the prices of commercial real estate. So, the situation now is – demand is increasing but supply is tight. And in this condition, rentals are bound to go up.

Why does this happen? Why do we sometimes see oversupply of commercial real estate and sometimes tight supply? It is because of the cyclical nature of the real estate industry. Some underlying facts regarding the commercial real estate are:

  1. It is a very large market and it is highly competitive
  2. Ownership of commercial real estate is highly fragmented across the country


Why does commercial real estate development follow a cyclical pattern? During the boom time, when local real estate developers and investors sense that vacancy rates are declining and rents are rising, they believe more development may be feasible. Consequently, developers begin to analyze markets to determine if additional space, if developed, can be leased profitably. Because many competing developers may sense this opportunity simultaneously, they may all begin to develop at once in order to satisfy the demand. Even though there may be a definite need for additional space, the potential for over-development will exist as each developer rushes to deliver additional space to the market before competitors. There is no way to determine exactly how much space should be developed because the depth and extent of demand are difficult to predict. As a result, commercial real estate is sometimes said to be prone to periodic cycles of over-development.

One would have seen during the 2004-2008 boom time in India, when plethora of shopping malls came up in Mumbai, Delhi NCR, Bangalore, Chennai, and other economic centers in India. Because there was demand for retail space, developers jumped up and created an oversupply of malls across India. The important point to notice is that it is very difficult to predict the exact demand and therefore oversupply will happen in commercial real estate.

On the other hand, when economy is going down and growth is shrinking, developers may ignore the development of commercial real estate because of lack of demand from companies. However, as soon as, economy picks up, the tight supply of commercial real estate again pushes up the rentals and vacancy rates starts to fall.

And the cycle continues like this. There will be periods of oversupply and there will be periods of tight supply.



Let’s analyze this diagram above.

  1. When economy is in recovery phase, the demand for commercial real estate increases which reduces the vacancy rates and rentals go up. 
  2. Seeing the fall in vacancy rates and improving rentals, developers start developing the additional space. Rentals start to cool off because there is supply of additional space. 
  3. However, because it is difficult to predict the actual demand, the oversupply of space is seen in the market. Rentals fall.
  4. Increasing vacancy rates and falling rentals drive away the developers from developing the commercial real estate and supply is tightened.

One full cycle takes 5-6 years and all the 4 steps mentioned above repeat themselves.


With this in mind, can you time the market as far as investment is concerned??





Have any Questions?

Wednesday, December 4, 2019

How to calculate Reverse Mortgage Loan Monthly Payments?

Author: Sachin Gupta | Find me on Twitter

In our previous post, we covered the concept of Reverse Mortgage Loan (RML). We covered elements such as definition of Reverse mortgage Loan, eligibility criteria, amount that can be availed, and modes & nature of payments.

People from across the country showed substantial interest in Reverse Mortgage Loan.  And there were queries from ‘formula to calculate monthly payment’ to ‘paying the amount back to bank’. We cover all of this below:

Installment Amount = ((PV*LTVR-OTDA)*I)/ (((1+I)^n)-1)

Where, PV=Property Value;
LTVR=LTV Ratio;
OTDA=One Time Disbursement Amount;
n=No. Of Installment Payments;
I= the value of 'I' will depend on Disbursement Frequency selected.

For Example,
Property Value (PV) = 10, 00,000
LTV Ratio (LTVR) =80%
One Time Disbursement Amount (OTDA) =0
Loan Disbursement Period=15 Years
Disbursement Frequency=Monthly
Interest Rate (IR) = 9.25 %

Calculations: On the basis of the inputs:
The disbursement frequency selected is Monthly so 'I' will be IR/12(i.e. 9.25%/12)
No. of installment payments (n) will be calculated monthly e.g. if 15 is selected then the n=15*12=180
Putting the values in the formula:
Installment Amount=Rs.2, 070;


Here is a detailed example of Mr. Sharma, 62 years of age and own a property worth Rupees 1.5 Crores in Gurgaon. Mr. Sharma lives with his wife 59 years of age. Both his sons are married and settled abroad. On knowing about the merits of Reverse Mortgage Loan (RML), Mr. Sharma decided to check on the eligibility and monthly payment that he will be getting.

While he is clearly eligible for the same (find Reverse Mortgage Loan Eligibility criteria), he found it rather cumbersome to calculate the monthly payment that he will receive.

Property Value PV = 1.5 Crores (15000000)
Loan to Value Ratio (LTVR) = 80% (As specified by RBI)
One Time Disbursement Amount (OTDA) = 0 (No amount is disbursed in one go, instead banks pay monthly payments to applicant)
Loan Disbursement Period (n) = 15 years or 180 months
Disbursement frequency = Monthly
Current Interest Rate (I) = 10.25% yearly or (10.25/12)% = 0.854167% monthly

Calculating the monthly installment amount by putting all these value in given formula in excel:
Installment Amount = (((PV*LTVR)-OTDA)*I)/ (((1+I)^n)-1)
Installment amount = 28294

So, Mr. Sharma will be getting a monthly payment of Rupees 28294 for 15 years. Upon completion of 15 years, Mr. Sharma can either extend his Reverse Mortgage Loan (RML) payments or pay the outstanding amount to bank to get back his house.



Have any Questions?