More articles for you

Your one stop place for everything related to finance and lending

FD

Your Guide for Fixed Deposit as an Investment Option

One of the safest and most secure investments is Fixed Deposits. Those who avoid investing in mutual funds or equity due to the risk associated with them consider FDs a great choice. With a fixed deposit, you can easily deal with your financial risks and fulfill your life goals. People invest in FDs to secure their child’s future, education, or marriage or to deal with unexpected expenses. You can also save a substantial amount for your future with FDs by putting aside a lump sum amount and letting it grow over a while. [B-01] Types of Fixed Deposits: Standard Fixed Deposit: It is the most common deposit. It can be opened in any bank with your savings account. 1. You can deposit money for a predetermined period 2. Interest rate is set by the bank 3. Duration- 7 days-10 years. Corporate Fixed Deposit: This deposit is made by private companies. 1. Offers high rates as compared to banks 2. Always check the company's credit rating to ensure your investment is safe. Cumulative Fixed Deposit: This can be your choice if you plan for a long-term investment. 1. Money invested for a predetermined period 2, Restricted from regular payouts 2. Money received at maturity Non-cumulative Fixed Deposit: This is the investment you have been looking for for short-term investors with monthly goals. 1. You can choose from monthly, quarterly, half-yearly, and yearly interest payout 2. Enjoy the interest on your invested money Tax-saving Fixed Deposit: You can avail of this deposit to save tax. It is available at all banks. 1. Tax redemption up to 1.5 lakh in a year. 2. Lock-in period of 5 years. (Funds cannot be withdrawn during this period) Senior Citizen Fixed Deposit: As the name suggests, this deposit is specifically for senior citizens. 1. Minimum age should be 60 years 2. FD Interest rates higher than standard rates Interest Rate in Fixed Deposits The FD interest rates range from 3-9%. The minimum period for an FD is 7 days The minimum amount for a fixed deposit is INR 1000. The interest rate on an FD depends heavily on which bank or private company you are borrowing from and for how long. The longer the period, the higher the rate of interest. Pros and Cons of Investing in FD PROS: Assured Returns: This is one of the main reasons people invest in FD. You can invest your money for a fixed period and relax. You will receive a lump sum amount on maturity. This helps an investor in making a stable financial decision. Allows Premature Withdrawal: In an emergency, you can withdraw funds from an FD. This comes with a fee, but it is a great assistance. Also, there are no complex rules and regulations for premature withdrawal in fixed deposits. Tax Exemptions: The interest that you earn from an FD is taxable. Tax exemption is available to a certain level. Investors and senior citizens can legally evade taxes under Section 80C of the Income Tax Act. Loan against an FD: This is one of the greatest advantages of investing in an FD. If you are not planning to break an FD in case of an emergency, you can get a loan against your FD. You can avail of up to 90% of the FD amount as a loan from financial institutions. High security: Investing in FDQ is safe and secure. This is because the principal amount and interest you will get are pre-decided. Factors like an unstable market and economic fluctuation don’t affect your returns. Availability: This scheme is available in almost all banks/financial institutions. This makes it easier for investors to visit their nearest government or private banks, NBFCs, or post offices to take advantage of this scheme. Quick renewals: If you want to build wealth, you can renew your existing FD. This way, you can double your interest and build a profitable portfolio. Higher rate of interest for senior citizens: In almost all banks and financial institutions, senior citizens get a higher rate of interest on a fixed deposit than standard interest rates. Flexible Tenure: One of the most attractive features of a fixed deposit. You can choose the period for your deposit at your convenience. Open to all: There are no complicated criteria for investing in a fixed deposit. Anybody who is an Indian citizen and NRI can open a fixed deposit with banks or NBFCs by just verifying their KYC. CONS: Lock-in period: You can withdraw your money from an FD easily. But still, there is a lock-in period until you cannot take out your funds. The lock-in period for your fixed deposit is mentioned on your FD receipt. You must check on it and plan your withdrawal accordingly. Penalties on withdrawal: One of the biggest advantages of opening a fixed deposit is a premature withdrawal facility, but a penalty fee is attached. A fixed percentage is charged for withdrawal by reducing your pre-determined interest rate. TDS: Interest earned from an FD is taxable. If your interest earned comes under the tax slab, 10% of TDS will be deducted from your interest. Lower Interest Rates: A fixed deposit is a secure investment, but some banks and financial institutions offer lower interest rates than inflation. Fixed interest: The interest rate for your fixed deposit remains unchanged till maturity. Even if the FD interest rates are revised, you will receive the pre-determined interest rate only. [B-02] Every investment has pros and cons. It depends on your expectations from an investment and its features. Based on these factors, you can choose the best investment that suits your purpose. This blog must have solved your queries about FD as an investment option.
08-11-2023
Read More
Personal Loan

Documents Required for Personal Loan – Salaried / Self Employed

It is common for people to be in urgent need of cash for various reasons. The most common ones include the following: a) Clearing the existing debts. b) Renovating the house. c) Purchasing an automobile. d) Medical requirements. The best solution to meet unexpected financial needs is to apply for a personal loan. Before we get into the required documents, let’s briefly know about personal loans. A personal loan is an unsecured loan offered to people to fulfill their financial needs. You can use a personal loan to take care of your immediate demands. The lenders consider different criteria before granting the loans, including the following: [B-01] a) Employment history b) Credit score c) Income level d) Repayment history. Personal loans for salaried and self-employed individuals can be usually paid back in monthly installments. Sometimes, personal loans are called “consumer loans”. The period is usually a few months or years depending on the purpose and how punctual your repayments are. Steps to get a personal loan It is advisable to compare all loan choices before making a decision. Most lenders would want a credit report, and along with the factor-interest rates, loan term and fees should be mentioned. Once a suitable lender has been chosen, the following documents have to be submitted: Loan details Income verification Personal information documents. For a hassle-free process, all the relevant and supporting documents should be submitted which might vary based on the income source. Different documents are needed for salaried and self-employed people. Documents required for a salaried individual If you are a salaried individual, you have to submit the following documents: Identity Proof Passport Aadhar Card Driving License PAN Card Voter’s ID Proof of Residence Ration Card Aadhar Card Driving License Passport Utility Bill Proof of Ownership of the Residence Electricity Bill Property Documents Maintenance Bill Proof of Income Salary slips for the past three months Bank statements for the previous six months Proof of Job Continuity Employment certificate issued by the current employer. Appointment letter from the current employer (if the employment period is more than two years). Experience certificate (job or appointment letter from the previous employer). Proof of Investment Fixed Assets Shares Fixed Deposits Photograph One passport-size color photograph. Documents required for self-employed individuals The following documents are needed for a personal loan from self-employed individuals. Proof of Photo Identity PAN Card Voter ID Passport Driving License Proof of Residence Passport Utility Bill Aadhar Card Proof of Residence Ownership Property documents Electricity Bill Maintenance Bill Proof of office address Property documents Electricity Bill Proof of Business Existence Company Registration License Tax Registration copy Shop Establishment proof Proof of Income Income tax returns for the previous two years. They should be inclusive of the computation of Income, audit reports, etc. Bank Statement Current bank statements and savings for the past year Proof of Investment ( If any) Investments that include fixed assets, fixed deposits, and shares Photograph One passport-size color photograph Things to keep in mind before taking personal loans for salaried individuals Maintaining a good credit score: This is a key factor that aids in the approval of a personal loan for a salaried individual. It should be maintained for ease of support on your later loan request. Employer reputation and stability: This is important when it comes to collateral-free loans. The lenders will be inclined to grant loans to employees of a reputed entrepreneur. However, individuals who work with reputed employers prefer low-interest rates. Thus, they are given many options to choose from. You should make sure that you work for a reliable employer before applying for a loan. Avoid multiple loan applications at the same time: It is important to avoid damaging your financial profile in hard inquiries. A hard inquiry takes place when the lender approaches the credit bureau for an official inquiry about your request. If you have taken too many loans, your credibility will be affected. It’ll make the lender hesitant to grant the loan. Things to keep in mind before taking personal loans for self-employed individuals Ensure your finances are doing well: Be diligent with your finances. It is important to put out a good portfolio for yourself since it is given that self-employment comes with fluctuating income. Have all the necessary documents to prove your income: The flow of income is the key difference between a self-employed individual and a salaried individual. Hence, proving your stability is important. It’ll be beneficial for your personal finance goals. This will ensure an efficient personal loan for self-employed individuals. Ensure security for the future: Uncertainty is a major factor in cases of personal loans for self-employed individuals. Businesses experience many changes with time. Sometimes, the profits may not be enough. It is important to show lenders proof of your savings. This assures them that you can get yourself covered in unexpected situations. [B-02] Conclusion You should assess all the requirements before deciding on a personal loan. It is important to apply for a loan that suits your financial aspirations and fits your current cash flow. The requirements for personal loans vary for salaried and self-employed individuals. Repay your loans on time to improve prospects for personal loans. Do not try to take too many loans. It will prove to be an obstacle in the future. Be sure to research all the different options and the potential risks of a personal loan. For further details, you can visit our website Piramal Finance. It’ll be our sincere pleasure to answer all your queries.
08-11-2023
Read More
Tax

Do You Know an Education Loan Can Get You a Tax Benefit

An education loan is the easiest way to finance your academic aspirations. It opens up the world of higher education to pursue locally and overseas. It allows you to experience college life and permits you to gain access to education at a higher level. An education loan also allows access to better educational institutions which have good: Teaching staff and faculty members Facilities and infrastructure Quality of education delivered Extra-curricular activities and opportunities An education loan also helps you with the very high costs of higher education nowadays. This is because an education loan allows you to pay for it through EMI instead of paying at one shot. An education loan not only pays for your higher education but also offers you tax gains. You can claim tax deductions irrespective of whether you are a student or a parent as long as you meet the requirements. This article showcases and explains the tax benefit aspect of an education loan. [B-01] Eligibility to claim tax benefit According to the law established by RBI, only individuals are eligible to claim a tax benefit. Joint loans are not taken into consideration when it comes to deductions. Apart from this restriction, only the individuals who fit the following criteria can qualify for tax benefits. It is per Section 80E of the Income Tax Act of 1961. Parents who co-sign or is the lead borrower on an education loan for their children. After getting a job, a student who took out an education loan can deduct this from their taxable income. A loan that is being paid by a spouse A legal guardian who is repaying a loan for the person for whom they are responsible may also be eligible for tax benefits. Purpose of the loan The reason behind taking the loan also impacts whether you can avail the tax benefits of an education loan. Only a loan that is taken to finance your higher education is eligible. Other types of education loans cannot be used to get tax benefits. Higher education is a full-time study you undertake. it is usually done after the senior secondary exam or its equivalent. This comes under the category of undergraduate loans. Any post-graduate degree you choose to pursue is also included in the education loans. This is also deemed suitable for tax benefits. Additionally, you might also get tax breaks for vocational training or career development loans. The latter involves taking a break from work to enrol in courses, modules, or training to develop their skills further or learn new ones. Thus, it is clear that tax benefits are provided for most fields of study when taking an education loan. Tax Benefit Amount It is important to note that when it comes to student loans, the tax advantages are only applied to the interest paid on loans. The tax benefit is not available for its principal sum. But, given that there is no cap on how much money you can save in a particular fiscal year, you can deduct all interest due. This compensates for the lack of tax advantages on the principal repayment. This makes an education loan a viable choice when seen from a tax-benefit point of view. Tax Benefit Duration Tax benefits on a student loan are only available for a limited time. Even though the time frame is quite long, it is good for you to know about it in advance. This allows you to plan the process of paying back your loan in a more financially sustainable manner. Simply put, the first year of repayment is when you begin making EMI payments on your education loan. Interest can only be deducted from your taxes for a maximum period of eight years, including this first year. For instance, if you pay back your loan in six years, you will only be eligible for the tax benefit for six years. Or, if the loan tenure exceeds eight years, you will only be provided with the tax benefits for eight years. Origin of funds The place or institution from which you choose to take the student loan also plays an important role. The tax benefits are only available if the loan is from a bank or authorized financial organization. Section 80E tax deductions are not available on all education loans. If you borrow money from friends or family to pay for your higher education, you will not receive any tax benefits when you repay them. This is because the government does not consider them to be eligible organisations. You should also use extreme caution when obtaining a Non-Banking Financial Institution (NBFI) loan. You should check to see if it is on the list of financial institutions that qualify for tax breaks. [B-02] Concluding Remarks Pursuing higher education is an important and memorable experience for each student. It is crucial whether it is local or international. You may extend the time you have to pay for it by financing it with a student loan. Making the most of the loan financially is necessary. You should thus make every effort to qualify for the tax advantages that come with the student loan. This reduces the financial burden of repaying the loan, increasing the appeal of an education loan. You can read more about student loans and other types of financing from the Piramal Finances page. They can help you to understand further how to manage and explore your finances in the best way.
08-11-2023
Read More
Other

Complete Guide on How to Check Your Entire Credit History

The state of your credit greatly influences your financial future. You can be eligible for loans with low-interest rates if your credit is in good standing, which could result in long-term savings. Having bad credit might make it difficult for you to fit the criteria for credit cards with the greatest benefits and rates and get credit for a major purchase. The credit bureaus in the nation use several variables, including the duration of your credit file and payback history, to determine your credit score. All this combined is your credit history. A better credit score may give you positive considerations when applying for a credit card or loan from a bank, such as a larger loan amount, a reduced interest rate, and a longer repayment period. You can easily get a larger amount of business loans with a better credit history. [B-01] Steps to Check Your Credit History Checking your credit report can give you an excellent understanding of your credit history. You must complete the following actions to obtain a record of your Report: Log on to the website of the credit bureaus and submit an online request for a copy of your credit report. Provide the necessary papers, including one ID and one address verification. Scan the papers and upload them. Pay online for your transaction. Suppose the supporting documents are accepted, and payment is made. In that case, you will receive your credit report by email within a day. What Exact Factors Include in Calculating a Credit Score? The major credit information bureaus use different methods to construct credit history. The general criteria mentioned below are used to determine your credit score: Amount of credit 30% of your credit score is based on how much money you owe on credit cards and loans like business loans. Your credit score would suffer if you have a large balance and have used up all of your credit card’s available credit. In comparison, low balances and on-time payments would boost the score. Payment record 35% of your credit score is determined by how you’ve paid your bills. Your payment history demonstrates if you have paid your bills on time, whether you have made late payments in the past, and whether you have paid them days beyond the specified deadline. Consequently, you will receive a higher score if you make more on-time payments. To avoid damaging your credit score, keep in mind you never skip a payment. This makes your credit history. The number of credit products in the portfolio The number of products you have and the categories of products you have accounted for 10% of your credit score. Using several products, such as business loans, home loans, and credit cards, might improve your credit score. The use of credit The last 10% is based on your most recent credit activity. The information about starting or applying for multiple accounts, your repayment history, the business loan types you have requested, and how much of your credit limit you have used are all considered credit activity. Duration of credit record The duration of your credit history determines 15% of your credit score. A long history of on-time payments will undoubtedly result in a higher credit score. What Lowers Your Credit Score? It has been widely known that carrying large credit card debt may dramatically lower your credit score. In addition to that, several different things might lower your credit score: Your credit score might be drastically lowered by running out of money. Disregarding your credit card or loan payments in full. Overdue credit card payments after the due date If you fail to make payments, lenders will engage third-party collection agencies to get you to pay back the loan. Receiving a collection account has a negative impact on your credit score. When credit card payments are not paid on schedule, creditors charge off accounts. Having your account disabled is among the worst things that may happen to your credit score. Closing outdated credit cards restrict the amount of your credit history. This will have an unfavourable consequence on your credit score. Your credit score drops if you apply for several credit cards or business loans. Limiting a lot of requests is a good idea. Your credit score will suffer if you just have one sort of credit account. Therefore, you should maintain a balance between credit card debt and loans while consistently making on-time payments. Advantages of a High Credit Score Increased Affordability of Loans Processing fees and other costs are tacked onto loans. You can negotiate your way out of some of these fees with a strong credit score. Prompt Loan Approval Your loan application will go more quickly if your credit score is strong. Banks could swiftly and easily approve your application for all business loan types. Best Rate of interest You may negotiate a reduced interest rate on credit cards and loans if you have a high credit score. Grab the Ultimate Credit Card You can get the finest credit cards with a good credit score. Benefit from having a card with lots of features. Check your credit score to determine if you qualify for these perks as soon as possible. [B-02] Conclusion A good credit score may empower you and assist you in reaching your financial objectives, such as obtaining a low-interest personal loan or a business loan to reduce your credit card debt or purchasing your first property. Understanding your credit score, where you fall in the credit score range, the contents of your credit history and the steps you can take to improve or keep your credit status are the first steps in ensuring superior credit status. To better manage your finances and maximise your credit perspective, check your credit score frequently and examine your credit report once a year. Still, have questions about credit history? Then, heed some guidance from Piramal Finance professionals. They will be able to guide you to a better solution because they will comprehend your needs.
08-11-2023
Read More
Other

Easy Steps on How to Maintain a Good Credit Score

Your credit history shows how responsibly you have managed the borrowed money so far and if you have repaid your credit bills on time. The CIBIL authorities summarize your credit history in a three-digit number, which is known as a credit score. Your credit score shows your lenders how financially reliable you are. So, maintaining a high enough credit score is a necessity if you want to secure a low-interest loan in the future. Let’s see some easy methods you must follow to maintain a good credit score. [B-01] Avoid Late Payments Never missing a credit repayment is the best way to maintain a good credit score. When you miss paying one or more loan EMIs or forget to pay your credit card bills, it impacts your credit report negatively. And if you miss too many credit repayments, CIBIL authorities will mark you as financially unreliable, dropping your CIBIL score. To avoid late payments, you can use a banking or credit automation app that will automatically repay your EMIs and credit card bills from your main bank account. You can even set a calendar reminder so you never forget your credit repayment dates. Maintain a Good Credit Utilization Ratio The general rule of thumb is to always maintain your credit utilization ratio below 30% to avoid a drop in your credit score. It means that you should never spend more than 30% of the total credit limit on your credit card. Once your credit utilization ratio reaches the 30% mark, you should pay some of your credit card bills. It will not only help you maintain a good CIBIL score but will actually increase it. Review Your CIBIL Report Regularly Your CIBIL report directly influences your credit score. Therefore, if the CIBIL authorities make any mistake in reporting your credit activities, it can drastically lower your CIBIL score, even if it’s not your fault. That’s why keeping an eye on your CIBIL report is important. If you see any inconsistencies that might be affecting your CIBIL score negatively, you must report them to the CIBIL authorities immediately. The authority will investigate your case and adjust your credit score accordingly. Use Credit Mix Too many unsecured personal, business, or education loans can be one of the biggest reasons for the reduction of your credit score, even if you’re repaying the EMIs on time. As these loans don’t involve any collateral, availing of too many of them can be seen as a big financial risk or an irresponsible financial decision. To maintain a good CIBIL score, you mix your credit lines with secured loans like home or property loans, which will balance the weight of the unsecured loans. After all, as long as you meet your repayment obligations, a healthy mix of credit is considered beneficial. Never Exhaust the Credit Card Limit You should always avoid exhausting your credit card limit, as doing so too often can negatively influence your credit score. If you keep doing this for a long time, your credit score can experience a significant dip. After all, it means you’re exceeding the 30% credit utilization ratio too often. If there is no way to reduce the cost, you should request that your bank increase your credit limit. As long as you have a good credit and bill repayment history, the bank should accept your request and increase your card’s credit limit. This way, you can avoid exhausting your credit limit and maintain a good credit score. Don’t Cancel Your Old Credit Cards Do you want to cancel your current credit card and have a fresh start? Don’t do it. Canceling an old credit card is never a good decision, as it nullifies all the previous credit card records with the bank. It will negatively impact your overall credit score. You can avoid all this trouble by just not canceling your old credit card. Keep the credit card and renew it. If you want, you can even get a new credit card and use it along with your old one. It will help you maintain a good credit score. Check Your Co-signed Loans Did you ever cosign a loan agreement with another partner? If you did, you should keep checking your cosigned loan’s repayment status. Sometimes, the borrowers might be unable to repay their loan due to a sudden financial emergency or simply forget to repay the EMIs on time. As a co-borrower, these missed payments by other borrowers also reflect in your credit history, dropping your credit score. So, next time, keep an eye on your co-signed loans and take proper measures to maintain a good credit score. Try Availing of at least One Credit Product: If you have never bought any products on EMIs, never taken personal or business loans, or don’t even use a credit card, you will sadly have no credit history or credit score. And without a credit history, you will have difficulty securing a loan for a large amount of money. Even if you secure the loan, you will have to pay a higher interest rate as banks are taking a big risk by lending money to you, an individual with no credit score or financial history. So, try getting at least one credit product, like a secured credit card or a secured loan, to start building your credit history. This way, you can finally receive a credit score after a few months. However, you should repay your credits or EMIs on time to raise your credit score to 750 or more, which is considered a brilliant credit score. [B-02] Final Thoughts Maintaining a credit score of 750 or above is very important if you want to secure loans with low interest rates. Pay your credit card bills on time and maintain a good mix of credit lines. Keep your credit utilization rate below 30% and review your credit report regularly. If you have no credit history, you can apply for a personal loan from Piramal Finance to start building your credit history.
08-11-2023
Read More
Home Loan

Here’s a list of Complete Eligibility Criteria For a Loan Against Your Property

Often one finds oneself in a problematic situation. A cash crunch or starting up a new business can put you in a tricky place. Even funding your children’s education can make you need funds. At times like these, you might want to get a loan. One of the most popular kinds of loans is a loan against property. In such a case, one takes a loan by keeping their property as collateral. Collateral here means security to the lender. It gives the lender a sense of protection. The property would remain as collateral until the whole loan is repaid. This makes taking and giving out loans easier and safer. [B-01] What is meant by Loan Against Property? In simple words, a loan against property means a loan secured by any property that comes under your ownership. You can then repay the loan in monthly instalments. These instalments are called EMIs (Equated Monthly Installments). The amount of EMIs is agreed upon for a fixed tenure. The rate of interest is also fixed when you enter the loan contract. The property given as collateral can be any house, land or commercial premises that you own. The value of your property determines the loan amount you can borrow. Where can Loan Against Property be Used? A loan against property can be used in a variety of situations. With such a loan you can take a loan of a big amount. The amount of the loan depends upon the value of your property. The major purposes you can take up such a loan are as follows: To fund higher education programs. Growth and expansion of business. Consolidation of high-interest debts. Renovation expenses of personal or commercial premises. To fund a wedding. To finance the medical expenses of a family member. What is the process for getting a Loan Against Property? After applying for a Loan Against Property, the lender will get your property assessed. This could be done directly by the lender. The lender might also get an expert valuer involved. The assessment involves many factors like age of property, location, condition, and ownership verification. The value arrived at could be different than the market value of your property. Also, the loan offered to you would not be for the whole amount of the valuation. Usually, lenders provide loans up to a certain percentage of the value of the property. This is called Loan-To-Value (LTV). This can be around 70-80% of the value. To illustrate, the value ascertained is Rs. 80 lakhs. The lender gives out an LTV of 75%. You get a loan of Rs. 60 lakhs. Advantages of a Loan Against Property There are several benefits derived from a loan against property. Especially if the loan is taken through a renowned brand like Piramal Finance. Some of them are stated below. Simple eligibility needs Minimal documentation needed Low loan rates Transparent processing with no additional fees Up to 15 years of additional tenure Quick sanctions and smooth processes What are the Eligibility Criteria for Loan Against Property? The usual loan against property eligibility criteria for a loan against property is given below: For a Salaried Employee Age Requirement Minimum Age: 21 years Maximum Age:A government employee – 70 yrs Others – 62 yrs Employment Type Individuals working in a: Government institution Public Sector Unit Private Firm Multi-National Companies Partnership firm / Limited Liability Partnership Organisations run by Trusts, NGOs or Society Documents Required Income Tax Returns for the last two financial years KYC Document Form 16 Last 6 months and salary slips of Bank Statements Documentation related to property is kept as collateral. For Self-Employed Age Required Minimum Age Requirement – 23 years Maximum Age Requirement – 70 years Type of Employment Professionals: Doctor, CA and Architect. Others: Self Employed Other than Professionals, Business Owners, Partnership Firms’ Partners and Promoter/Directors of private and public limited companies. Documents Required Income Tax Return of the last two years Financials audited by CA KYC Document Form 16 Last six months’ bank statements Documentation related to property is kept as collateral. Tricks to Keep Loan Against Property Interest Rates Low Now that you know the loan against property eligibility criteria, let’s focus on the loan against a property interest rate. You would aim to keep the loan against property interest rates as low as possible. For this you can use the following tricks: Reduce the Principal For unforeseen needs, you might want to borrow a little bit more money than you need. While doing so it is important to avoid going overboard. Larger interest rates may be the outcome of borrowing more money than you are qualified for. The lender may see your application as having a higher chance of default. So keep your loan amount low. Select the Appropriate Interest. Consider carefully whether to choose a fixed or floating interest rate for your loan. The secret to deciding between the two is to make the best predictions about loan rates in the future. Floating-interest loans have no prepayment fees. So you save more money when you choose to make prepayments. Make the Appropriate Property Pledges You want to obtain reduced interest rates and a greater chance of getting your loan approved. This can be done by pledging a high-value home in an expensive region. However, the lender would not provide you with favourable conditions if the property is old, poorly kept, or situated in an undesirable area. Verify Your Eligibility in Advance Making note of your lender’s loan against property eligibility needs will help you avoid application rejection. To ensure a smooth application process, learn about the loan against property paperwork needed after determining your eligibility and have them prepared. [B-02] The Bottom Line So what are you waiting for? Ready your documents. Evaluate your property. Get the best loans out there. To know more about the financial world and how to get the best loans, visit Piramal Finance. Piramal Finance is an Indian financial service. They provide all kinds of loans. They also provide answers to all your loan-related questions. Check out their website for all your finance needs.
08-11-2023
Read More
Gold Loan

Can I Transfer A Gold Loan From My Current Bank To Another Bank?

India is well-known for its custom of handing down gold ornaments and jewellery from generation to generation. Therefore, using gold as security to get loans is the most practical borrowing option for the majority of the country’s population. However, individuals often request gold loans without first doing a thorough investigation. Therefore, they wind up with a gold loan business that does not provide them with the greatest possible bargain. If you are in a similar scenario, a gold loan transfer may save you money on EMIs while also getting you a better return for your gold. [B-01] What exactly is a gold loan? A gold loan, also called a LAG (loan against gold), is a type of secured loan taken from a creditor in return for gold goods. Lenders will usually provide you with a loan based on a percentage of the gold’s value. You can pay it back in monthly instalments and get your gold items back. Like similar secured loans, like a home or car loan, gold loans have no restrictions on how they can be used. So, if you need to pay for a marriage, a vacation, or your kids’ education, it is a terrific option to fulfil an unexpected financial need. Furthermore, several commercial and nationalised banks, as well as NBFCs, provide gold loans at low interest rates. What exactly is a gold loan transfer? When you do a gold loan transfer to the other bank from one bank, it is known as a gold loan transfer. Many consumers move their gold loans because they are dissatisfied with their current lender’s customer service or because the loan amount is less than the gold’s worth. One of the most frequent reasons consumers switch loan amounts is because their present lender charges high loan instalments. Although gold loans have a relatively short repayment time, high interest rates may result in a substantial amount to repay. This means that by simply shifting your money, you may be able to lower your gold loan instalments. When should you think about using a gold loan transfer service? When you need money to get yourself out of a financial problem. Money is easily available for business expansion, education, and other purposes. You’ve already obtained a gold loan and made various instalment payments. You would like a loan with minimal documentation that can be handled quickly. You need a gold loan with a lower interest rate than you currently have. What are the additional benefits of a gold loan transfer? The benefits of transferring a gold loan are: Interest rate cut Many lenders demand higher gold loan EMIs than their rivals. Borrowers may transfer their debts to a lender with a reduced interest rate, making the process of repaying a loan much simpler. Higher rate per gramme Financial institutions provide loans ranging from 75–90% of the gold loan value. Moving the loan to a supplier with a greater loan-to-value (LTV) ratio is an excellent choice if you’re obtaining a lesser value for your gold. Improved Terms A gold loan transfer provides the opportunity to get better loan conditions, such as flexible payback periods and no processing costs. Increased Security and Insurance Options Some borrowers may be unsatisfied with the security supplied by their existing lender for their gold. As a result, a gold loan transfer to the other bank that provides stronger protection, such as insurance policies, may be the best alternative for them. What exactly is the gold loan transfer procedure? To effectively transfer your gold loan sum, follow these steps: Step 1: To begin the gold loan transfer procedure, provide the new lender with your current pledge card. Step 2: After the specifics of the whole transfer procedure have been worked out, you will get a savings analysis report, which you must examine and then approve. Step 3: Complete the verification process after confirmation to finalise the personal gold loan transfer. Step 4: You will be provided with a detailed breakdown of how much in gold loan instalments you need to repay to the previous lender to start the gold transfer to the new lender. Step 5: After you pay the interest, your gold loan will be successfully transferred to the new lender. What gold loan transfer documents are required? Lenders often seek the following papers during gold loan transfers: Completed gold loan application form Identification documentation: It might be an Aadhar card, a PAN card, a passport, a driver’s license, or a voter identification card Proof of address, such as a utility bill, gas bill, most recent water bill, passport, and so on A signature verification Passport-sized photos Balance Transfer Fees for Gold Loans Charges for Transferring Fees Charges for a gold loan transfer to the other bank differ depending on the current and new lenders. These fees are as follows: 1. Pre-closure fees Pre-closure costs, also known as foreclosure charges, are payments made to your current lenders to compensate for the interest lost when you close your loan too early. Each bank has its own foreclosure threshold, which varies from 0% to 1%. 1. Processing Charges Processing fees range from 1% to 5% of the loan amount for banks and NBFCs. 2. Inspection Fees When a financial institution evaluates pledged collateral, it charges a fee. 3. Administrative Fees When you apply for a loan, the lender charges you a non-refundable fee that is applied to the loan amount. [B-02] Conclusion A gold loan transfer to the other bank from one bank could be a smart choice. The procedure is typically fast and easy, and the new loan will have a lower interest rate. Also, the borrower may make use of several real-value services as well as various repayment choices. Gold loans, in general, are useful when you want funds quickly. Not only should you comprehend such items to deal with future needs, but you should also be aware of impending new variations that are safer and efficiently cut the total interest load on the loan. To know more about such types of topics, visit Piramal Finance.
08-11-2023
Read More
Business Loan

Business Loan for Entrepreneurs in India

In many cases, a firm’s profit needs a boost. When a firm finds financial aid at the right time, it may reach its full potential. Such aid is often needed, mainly when your firm is in its early stages or expanding. A business loan for Entrepreneurs is a great source of finance to help your business financially. Young entrepreneurs with unique ideas but little money might benefit from business loans. Entrepreneurs may apply for a business loan to cover their financial needs and then repay the lender. Let us now link you to this topic in more depth in the next part. [B-01] Perks of Business Loans for Entrepreneurs Business loans for entrepreneurs are used to describe loans required for expansion. Sometimes you might confuse yourself with the entrepreneur loan, but these are not the same. Here are the perks of business loans for entrepreneurs: Prompt payment When people request a business loan, banks realise they need the cash as quickly as feasible. As a result, banks provide quick firm financing. A small firm loan may be issued within three days. Your firm can expand without being hampered by a lack of cash. Minimum paperwork required To complete loan forms, banks demand a minimum amount of papers. You won’t have to complete a lot of paperwork to secure a loan from us. Firm financing papers may be submitted online or offline. This, however, depends on your lender. Competitive rates Your business loan rates remain low since financial firms are devoted to aiding small businesses in India. You may seek help with money without having to make hefty payments. Eligibility Criteria of a Business Loan For Entrepreneurs Self-employed persons, proprietors, private limited firms, and partnership firms engaged in manufacturing, trading, or providing services. Annual business revenue of at least Rs. 40 lakhs. People who have worked for the present firm for at least three years and have five years of firm experience. Those whose firm has been profitable over the last two years. The firm’s minimum annual income should be Rs. 1.5 lakhs per year. The applicant must be at least 21 years old when applying for the loan and no older than 65 years old when the loan matures. Papers Needed to Apply For a Business Loan: Firm or people PAN CardA photocopy of any of the following papers as evidence of identity Aadhaar Card Passport Voter ID card PAN Card Driver’s LicenseA photocopy of any of the following papers as evidence of address: Aadhaar Card Passport Voter ID card Driver’s License Bank statements from the last six months After CA Certified/Audited, provide the most recent ITR, income, balance sheet, and profit and loss account computations for the past two years. ITR or Trade license or Sales Tax Certificate as proof of continuation is required. Other required papers include the Sole Proprietorship Declaration and more. How to Obtain a Business Loan as an Entrepreneur? This section will walk you through the steps of obtaining a business loan: Define your loan needs The first and most vital stage is thoroughly defining your firm’s financing needs. It is essential to specify your needs since the bank or lender will base their judgement on whether you need a loan. By clarifying the need, you may guarantee that you are not overstating your requirements. Make a thorough business plan Following the identification of the necessity, the second vital aspect in obtaining a firm loan is developing a firm plan. By reviewing your business plan, lenders may better understand how you intend to spend and distribute the funds. It will also provide a rough idea of how you aim to build your firm. The lender will surely want to know it to guarantee that you can make the repayments on time since failing to do so would result in a loss for the lender. Make sure your strategy is concise yet thorough. You may include the following items in your plan: The reason for your firm’s existence. Use relevant data from your field. Your firm’s previous success. Future objectives for the firm. Prepare Papers When your firm plan is established, the following step is to prepare the papers. Paperwork is one of the most challenging parts of qualifying for a business loan since it entails many complex tax filings, money deals, and other legal processes. Another reason is that the process takes longer to complete since more money is involved, necessitating more papers. Other papers may be required depending on the lender. Yet, the following is a broad list of the papers required: PAN Card Income tax returns & GST returns Partnership Deed or Certificate of Incorporation Your firm account’s bank proof Money proof from the previous three years, including audited balance sheets, audit reports, profit and loss proofs, etc. Money projections for the future Contact the lender Visiting lenders/banks is the penultimate stage in the business loan form process. You can also choose an online business loan to make getting financing easier. To guarantee the best deals, compare the costs and perks of numerous lenders before making contact. Bank loans, for example, may have lower rates but need a longer time to repay. On the other hand, small cooperative banks provide greater lending rates while requiring fewer papers and proofs. Another important question to ask is about the security that lenders need. Finally, if you require a business loan from a lender, you should determine what extra fees and processing expenses are involved. [B-02] Conclusion Acquiring capital is vital for a firm’s growth and progress. Business loans are useful when a firm wants to borrow funds or expand its operations. They may also aid in preserving cash flow during tough times. Business loans help you stay financially secure in a volatile market. Consider all the perks and drawbacks of contacting each lender before deciding on which is best for you. If you want more information about personal loans, check out similar blogs on Piramal Finance and explore their products and services.
08-11-2023
Read More
Calculator

Commercial Loan EMI Calculator – Calculate Your EMI

When you take a commercial loan from your bank or lending institution, you will need to understand the payment schedule. A commercial loan EMI calculator helps you calculate the monthly payments and interest on your loan. You can enter the amount of the loan and the annual interest rate. Then, it calculates your monthly payment, total interest, the total number of payments, etc. This helps you determine whether or not you can realistically afford the loan and enables you to plan your cash flow more effectively. [B-01] What is a loan? A loan is a sum of money you borrow from someone, typically a bank or lending institution. It must be repaid with interest over a predetermined period. Commercial loans provide easy access to capital and lower rates than other types of loans. What is an EMI? An EMI is an acronym for “Equated Monthly Instalment.” When you take a loan, you will have to pay back the borrowed money plus interest on the debt. The total amount is broken down into monthly instalments throughout the repayment period. The more money you borrow, the higher your monthly instalment will be. If you’re not careful and need to understand how much it will cost in terms of interest, it could be a lot more expensive than you originally thought. A commercial loan EMI calculator comes in handy to understand what your monthly instalment might look like based on your yearly income and the type of loan. Factors affecting commercial loan EMIs A large commercial loan can be daunting to handle. To calculate your monthly payments, it is important to understand the various factors that will affect the EMI (equivalent monthly instalments). Principal amount: The principal amount of the loan determines how much you have to pay back every month. If you choose a higher interest rate with a smaller principal amount, your EMIs will also be lower. Interest rate: The interest rate applicable to your commercial property loan would depend on various factors, including your eligibility and credit history. Different banks may offer different interest rates, making it necessary to find one with an EMI that suits your budget and requirements. Duration of the loan: The duration of a commercial property loan would depend on various factors, like your repayment plan and budget. If you want to pay off your commercial property loan in a shorter period, you can choose a home loan with a short tenure. However, keep in mind that it will result in higher EMIs. Alternatively, if you want a long-term repayment plan, opt for long-term loans. Also, make a down payment and take out a mortgage for only part of its value. Monthly or annual rest period: There are two types of rest periods: monthly and annual. The interest is calculated accordingly, leading to decreased EMI payments over time. It depends on how often the interest is compounded. However, with the annual rest period, your monthly payments are capitalized at the end of each year. Fixed instalment/interest percentage: Another thing to consider when calculating your EMI for a commercial property loan is whether you want fixed or variable instalments. Also, consider if you want a fixed or floating interest rate. The floating interest varies according to fluctuations in the market index and the cost of borrowing. Commercial loan EMI calculator A commercial loan EMI calculator is a tool that can help you determine how much you need to pay each month. The calculation is based on the amount of money borrowed and the interest rate. It’s important to consider that this doesn’t include other fees, such as application and processing fees, which your lender may charge. The commercial loan EMI calculator will ask for information about some things like: your monthly income, the duration of your repayment period, the amount of money you’re borrowing, and the interest rate. The calculator works on the mathematical formula (EMI= PR (1+R)^D /((1+R)^D-1)) where P stands for Principal or amount borrowed, D is the duration in months of your repayment period, R represents the annual interest rate, and EMI is the Equated Monthly Instalment. An example of this would be if a businessman took out a loan of INR 4,50,000 for a tenure of 36 months, at 16% interest, their EMI would be INR 15,821. How does a commercial loan EMI calculator work? Select the loan amount, interest rate, and tenure from the drop-down menus and click on “calculate.” The commercial loan EMI calculator will show you the details of your repayment schedule, including EMIs, principal paid, and total interest paid. You can also see a graphical representation of your monthly repayments using the slider bars below the repayment schedule table. Benefits of a Commercial Loan EMI Calculator A commercial loan is used to purchase a business or other assets. This commercial loan EMI calculator helps you calculate your monthly payments. Some of the benefits of a commercial loan EMI calculator are: The ability to easily calculate your monthly payments. It includes a large range of values, which allows for different scenarios such as a lower down payment and a longer repayment period. Calculates total interest paid throughout the loan. Allows people without access to a computer to figure out their monthly payments. Provides information on rates, term lengths, and annual percentage rates (APRs). [B-02] Conclusion The commercial loan EMI calculator is a great tool if you’re interested in learning more about your EMI payments. It can also be used by banks and lenders, such as when they want to determine how much interest they will receive on an investment. Or commercial property investors can use it to know their monthly rental expenses before taking on the project. The math involved with determining your monthly payment may seem daunting at first glance, but a commercial loan EMI calculator makes it easy. For more information, head over to Piramal Finance.
08-11-2023
Read More