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Home Loan

Top 6 Reasons Why You Should Opt for Mortgage Loans in India

Needless to say, life can be unpredictable at times. During a time of crisis, having a property against which you can obtain a loan can prove to be very helpful. You can leverage your immovable assets, like a shop or house, to take out a mortgage loan. You can further use it for your immediate financial requirements. Not clear about the concept of a loan against property? So, before we proceed further, let us understand mortgage loans. [B-01] What is a mortgage loan? A mortgage loan is a kind of financial assistance for the loan taken against a property that you legally own. This property or fixed asset can either be your home, your shop, or any of your land. It should be an immovable asset. These loans are offered by either banking or non-banking finance companies. The loan is offered to you as a principal loan by the lender, who charges you interest for that particular amount payable in monthly installments. One of the most significant advantages of applying for a mortgage loan is its ease of repayment. Monthly installments can be used to repay the loan. The rate of interest is also usually on the lower end. However, your property or an immovable asset stays in the possession of the lender until the loan amount is paid back in full along with the interest. The lender of the property has the legal right to claim the property if the borrower of the loan doesn’t pay it back. In such a case, the lender can seize it and sell it off to cover their damages. Top 6 Reasons to Opt for a Mortgage Loan in India A person can take out a mortgage loan for several reasons. Here are the top 6 reasons why people should opt for mortgage loans in India. 1) Mortgage Loans Come with Lower Interest Rates A loan against property is taken while keeping a fixed asset, like a house or commercial property, as collateral. The interest rate is usually lower when compared to other loans, such as personal loans. Mortgage loan interest rates typically range between 12% and 15%. 2) Lower to No Prepayment Charges Lenders such as banking institutions don’t levy any kind of prepayment charges for loans against property. This is one major reason people opt for a mortgage loan. 3) Mortgage Loan Is Easy To Get & Has Longer Tenure As a mortgage loan is a secured loan, you can easily get it through banks. The biggest advantage of having a property loan is that it is available for a longer tenure. The tenure can go up to 15 years. That’s more than a decade, and it is a good enough time to repay it properly. On the other hand, other types of loans, such as personal loans, only go up to 7 years. This is far less than a loan against property. 4) Mortgage Loans Come with Lower EMIs Another practical reason to opt for a mortgage loan is the lower EMIs. The longer you have to repay your loan against property, the lower your EMI will be. People tend to choose mortgage loans because they generally cannot afford to pay higher EMIs. 5) Mortgage Loans Improve Your Overall Credit Rating A mortgage loan, like any other loan, allows people to build a good credit score. A good credit score improves and lowers your future cost of borrowing. However, the credit rating could also be negatively affected if the loan is not paid back in full. In such a case, your overall ability to obtain any type of loan will be greatly reduced. 6) You Get to Enjoy Tax Benefits With a loan against property, you get to enjoy tax benefits as well. However, in order to claim deductions, you must be able to demonstrate that the mortgage loan was used for business expenses or to purchase residential property. Different Types of Interest Rates on a Mortgage Loan While paying the mortgage, you can opt for two types of interest rates. Fixed and floating interest rates. First, let us understand what these interest rates are. Fixed interest rate As the name suggests, the fixed interest rate remains constant for the whole loan tenure. The changes in the market do not affect the interest rate. This is why many people prefer fixed interest rates. It helps the borrower keep away from any kind of financial risk while giving them the freedom to pay back the loan amount in monthly installments. Floating interest rate The floating interest rate keeps changing as per the repo rate and market fluctuations. As the name suggests, the floating rate changes periodically. It is directly impacted by the fluctuations happening in the markets. However, many people prefer to opt for this rate of interest as many times the variable declines owing to market conditions. In such a case, the borrowers also end up paying a lesser interest amount. You can choose the type of interest rate according to your preference. [B-02] Conclusion If leveraged the right way, a mortgage loan can prove quite beneficial for anyone who needs funds. There can be any number of reasons for people to take out a mortgage loan, from funding a wedding to funding a business. And opting for a loan against property can help you resolve all these issues. To know more about other such topics, visit the Primal Finance website.
08-11-2023
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Credit Score

Top 10 Reasons for Loan Rejection with a Good Cibil Score

A good Cibil score is demanded in the market, thanks to reputable credit information providers. Understanding the value of these various ratings and how they affect your trust as a borrower is vital. Based on your data, the assessors of your ratings examine various factors. Then, if you’ve applied for a loan, there may be an individual basis for evaluating your score. This bias is the result of your rating study earlier. Risk managers are responsible for securing a bank’s debt to protect it from bad debt. In doing so, experts may consider aspects not included in the overall review. This may result in your request being rejected, even if you’re just slightly below the cutoff. By studying the key elements, let us look at ways to ensure loan approval. Consider the following scenario: You have worked hard to improve your credit score. You are convinced that banks will quickly approve your loan form and provide inexpensive rates. But your form has been turned down. Doesn’t it seem perplexing? After all, you’ve known for years that the CIBIL score significantly impacts the lender’s choice to give you a loan. [B-01] What Might Have Gone Wrong? Knowing that the CIBIL score is not the sole factor banks or lenders check before accepting you for a loan is crucial. Other variables come into play throughout the loan procedure. Let’s discuss some reasons. Top 10 Reasons For Loan Rejection Here are the top 10 issues that might block loan approval. Read through all of the reasons carefully; if any of them hold, rectify them before asking for another loan. 1. Job insecurity Lenders will be far more confident in your solvency and approve your loan application if they realize you have a secure job with a continuous revenue stream. Lenders, on either hand, may reject you as a client if they discover that you often change employment and have an unsteady income. Keep in mind that lenders prefer candidates who can repay the borrowed funds. As a result, many businesses seek to avoid people with uncertain employment. 2. Unsuitable loan form The favorable data on your loan form can cause an increase in your reputation. Make sure you go over your form carefully and fill it out completely. Your loan application may be denied if you fail to produce a copy of the needed papers, such as your pay stub or identification evidence. Please keep in mind that lenders constantly verify each paper you supply, and any discrepancy might decrease your chances of obtaining a loan. 3. Comments on CIBIL reports The comments in the CIBIL report are yet another cause a loan form is declined. Paying EMIs after the deadline, requesting a lower rate, etc., are instances of comments. Any comment in the report demonstrates the applicant’s negligence or poor repayment habits. However, it is strongly advised not to disregard the comments in a CIBIL report since lenders will analyze the applicant’s credit history before giving a loan or credit. Individuals should attempt to resolve the remarks by speaking with creditors or paying off all debts. 4. Frequent use of credit Borrowing frequently, even with a good Cibil score, is among the causes of loan refusal. It raises concerns among banks and financial organizations about your capacity to repay. Even if you pay many loans, EMIs, and credit sums on time, lenders still question your credit reliance and consider you a high-risk debtor. Lenders will also be cautious about granting you a new loan amount since it’s normal to feel you would get overloaded with a new credit amount, resulting in missed or delayed credit payback. 5. You owe much too much money If you apply for the loan, the lender will look at your credit record and see if you have any open loan accounts. Despite a strong credit score and making your EMIs or card payments on time, the bank may assume you have a lot of debt and lack the discretionary funds to pay off your obligations in a liquidity crisis. 6. Your income may be insufficient Insufficient income is also among the reasons for loan rejection. Personal loans have income requirements set by lenders. Your loan will be denied if your income does not meet the income requirements set by the bank. There is also the debt-to-income ratio, which must meet the lender’s requirement. Only then will your loan be accepted. 7. You have missed a loan payment As a good Cibil score is appreciated, some lenders may reject your application if you have any payment failures, even if they occurred long ago and you have a strong track record since then. 8. Secured loan to unsecured loan ratio These loans are those obtained against assets or from a guarantor (housing loans, vehicle loans, etc.), while unsecured loans are those made without security. A favorable ratio would have more secured loans than unsecured loans. 9. Many inquiries The CIBIL identifies you as a “frequent inquirer” if you apply for multiple loans or credit cards from various lenders. Even if you’ve got a good Cibil score, a lender might reject your loan application entirely. 10. The co-applicant has a bad CIBIL score If you borrow money from another person, you should first check their CIBIL record. If one of the co-applicants has a low CIBIL score, the loan application will most likely be denied. [B-02] Conclusion Banks have tight loan rules, policies, and laws regulating bad debts. It would be good if you were strict about your finances. Some banks also have begun to include a good Cibil score in credit cards. You should never dismiss a discounted score without thoroughly studying its reasons. If there is a disparity, it should be reported to the relevant bank right away. A credit rating of 750 is regarded as a good Cibil score and highly desirable. For more blogs on reasons for loan rejection, check out Piramal Finance and explore their products and services.
08-11-2023
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How To?

Easy Steps For How To Choose The Best Home Loan

Buying a home is no easy task. There are a lot of factors to be considered while doing so. You might have spent a lot of time weighing the pros and cons of different houses based on the location, amenities, and cost. But have you been thinking of the right home loan to finance your dream home? Home loans may make it easier to purchase your dream house. But, it is not something that you should take lightly. You can spend many years repaying your home loan. It is a long-term commitment that requires careful consideration and research. These days, many types of home loans are available. How do you know which one is ideal for you? In this article, you will learn how to choose the home loan that best suits your needs. [B-01] How To Choose The Best Home Loan For You? Let’s take a closer look at some factors that may influence your decision to choose a home loan: Lender’s Reputation You can start by checking the lender’s reputation in the market. It can always help to learn more about your lender. Are they reliable? Are they being transparent about all their charges? Are they mobile-first? How do they keep your documents safe? These are some questions that you need to find answers to before selecting a lender. You can look up the lender on the internet, or browse through their website. Maximum Amount There is a limit to the amount of money that you can borrow. Some lenders might be prudent and be willing to finance around 70-75% of the total required amount. Whereas, some lenders might be willing to finance up to 80%. This depends on your income level, repaying capacity, and the value of the property. Carefully, consider the amount of loan that you want to take. It is wise to not go beyond 40% of your net household income. Rate of Interest This might be one of the most important factors to consider when taking a home loan. Different lenders will offer different rates of interest. The rate of interest can be classified into two types- Fixed Interest Rate- Some loans may include a fixed rate of interest. With a fixed rate, your interest rate remains the same throughout the tenure of the loan. Even if your lender revises the interest rates in the future, your interest rate will remain fixed. Floating Interest Rate- Some schemes may offer a floating rate of interest. Here, the rate of interest may change according to guidelines given by the Reserve Bank of India. This means that throughout the tenure of your loan, your interest rate can get higher or lower. Pre-payment of Home Loan You should check if your lender allows prepayment of the loan. Consider the ease with which the lender allows for pre-payment. There is another factor to consider here- pre-payment charges. If you choose a floating rate of interest, you will not be required to pay any charges on the pre-payment of your home loan. The Reserve Bank of India does not allow financial institutions to levy such charges on floating rates of interest. However, if you choose a fixed rate of interest for your home loan, you might be required to forego an amount in the name of pre-payment charges. Make sure to check for the terms and conditions of pre-payment while deciding on a home loan. Processing Fee When you apply for a home loan, there are certain charges that you need to consider. One such charge is the processing charge. This is levied for processing the loan application and to cover the expenses incurred by the bank while assessing property value and checking other loan-related documents. Tenure of loan It is important to check how long the tenure of your home loan is. The longer the tenure, the lower the EMI will be. This reduces the financial burden to some extent. However, loans with a longer tenure also have a higher interest outgo. On the other hand, loans with a shorter tenure will have a higher EMI but a lower interest outgo. You should take your paying capacity into consideration while making this decision. Over-draft Account You can also opt for a home saver loan. This works like an overdraft account. In this, you can deposit your extra savings into the account linked with your home loan account. The bank will deduct money from this account while calculating your interest. Interest is only calculated on the balance amount. Due to this, you can save a fair amount of money on the overall interest. [B-02] The Bottom Line Home loans are a long-term financial responsibility. Any decision related to them should be taken after careful consideration. It can not only affect your present financial stability, but it will also have an impact on your financial standing in the future. We hope these details gave you a better understanding of the factors that should be considered before taking a home loan. If you feel unsure at any point in time, you can reach out to reliable sources like Piramal Finance and read further articles on home loans.
08-11-2023
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GST

Documents Required For GST (Goods & Services Tax) Registration

In July 2017 the tax-paying citizens of India got introduced to a new concept – the Goods and Services Tax (GST). The new tax replaced all the existing indirect taxes. These included the Central Sales Tax (CST), Service Tax, excise duties, etc. But many still wonder – What is GST? Simply put, this tax on goods and services is levied at 18% (inclusive of central taxes). Let’s say you buy goods or services from a retail store in India. The final purchase cost in this case will include a tax of 18%. To ensure that you comply with the GST regulations, learn a few essential things about it. Foremost of them are the documents required for GST. But before we discuss the documents, let’s look at who should register for the tax. Read on! [B-01] Who Should Register for GST? Anyone who engages in trade or business in India must register for GST. This includes: Individuals and businesses with an annual turnover of more than Rs 50,000 Sole proprietors with an annual turnover of Rs 60,000 or more. Additionally, certain businesses that import or export goods worth more than Rs 50,000 per annum must also register for GST. While the rules allow exceptions, most businesses should register for GST regardless of their size. With accurate registration, businesses can enjoy several benefits, such as simplified tax returns and improved compliance. So, what are you waiting for? Start the registration process today! Main Documents Required for GST Registration The documents required for GST registration will vary depending on the type of business you are registering for. For instance, suppose you want to register for a company. In this case, you must provide the following documents: Proof of your company’s legal status and ownership Information about the goods and services you will be selling. You must also file a return and pay applicable taxes/fees. Make sure you have all the necessary documents before beginning the process. Here is a list of the documents you require: PAN Card of the Business or Applicant If you are an individual applicant, submit your PAN card with the application form. If your business is a company, then submit your Annual Return Form (Form 993) and GST Registration Certificate (Form GSTR-1). In addition, provide proof of identity and address. All the required documents should be original, and copies are not allowed. Identity, Address Proof and Photographs When registering for GST, carry proof of identity and address with your photograph. Other documents may be required depending on the type of business you are running. For best results, save a copy of these documents in one safe place and avoid delays. Business Registration Document The business registration document is one of the most crucial documents for GST registration. There are various kinds of business documents available, each tailored to meet specific requirements; for example, an Annual Return would be necessary if you’re registered as a small or micro-enterprise. Address Proof for Place of Business If you run a business, address proof is mandatory. This can be a copy of your voter ID card, driving license, or government-issued document. In addition, you must also provide proof of identity – a copy of your passport or driver’s license. Finally, submit an invoice/purchase order for goods/services supplied/used in the past 12 months. Bank Account Proof Bank account proof is another vital document for GST registration. Remember that the business owner and the accountant/tax officer must further sign a GST registration GST Registration Documents for Partnerships and LLPs Partnership and LLP entities must register for GST if they have more than ten partners or 50% ownership. The application form must contain the name of the entity, its registered office address, and the contact details of the person who will file for GST returns. Other crucial information includes the partnership or LLP’s nature of business. The business must submit the documents to the relevant tax authority within 30 days after creating or amending them. GST Registration Documents for Companies Starting a business can be a daunting task. But it doesn’t have to be – with a bit of preparation; everything will fall into place. That’s why you must register for GST as soon as you start trading. The registration process is easy and free; all you need are the required documents. Once registered, your company can begin filing your taxes online with the GST department. Make sure to track your filings – if any discrepancies exist, contact the GST department directly. In a nutshell, registering for GST is the first step on the long road to starting a successful business. So go ahead and get started! [B-02] Wrapping Up Now that you know what documents are required for GST registration, it’s time to start. Make sure to have all the required documents handy before registering. If you need clarification about how to go for GST registration, reach out to professionals. Experts at Piramal Finance will help you understand the intricacies of GST registration. Being professionals in the field, they can assist you to proceed with the registration.
08-11-2023
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Lifestyle

Easy EMI for Hair Transplant and Cosmetic Surgery in India

Cosmetic surgeries are becoming increasingly popular in India. As per the International Society of Aesthetic Plastic Surgery, in 2020, India saw the 10th highest number of cosmetic procedures globally. Similarly, Indians are also increasingly opting for hair transplants. But these procedures are costly for an average Indian. The cost of cosmetic procedures can range from ₹1,500 to ₹3 lacs. The cost is affected by the type of procedure, additional hospital charges, and any complications faced during the surgery. The cost of a hair transplant depends on how many grafts are used. One graft can have from one to three hair follicles. So, the price of the surgery can range from ₹60,000 to ₹1.5 lacs (without tax). There are also extra costs, like fees for the consultation, medicines, and post-operative care. These procedures are believed to have permanent effects, making them worth the price. So, if you are considering one or both of these procedures, a personal loan is an excellent option. [B-01] Loan for Hair Transplant and Cosmetic Surgery Most Indians cannot afford to get plastic surgery because these costs are not covered by insurance. Medical insurance only pays for treatments that save a person’s life or help a body part to work again. So, insurance does not pay for these surgeries unless they are considered reconstructive. To meet your expenses, you can consider a personal loan for a hair transplant or cosmetic surgery. What Is a Personal Loan? Personal loans are unsecured loans given by banks and NBFCs. Unsecured loans do not require you to put up any asset as security to get the loan. The use of the personal loan amount is not restricted by the lender. You can use the loan money for anything, ranging from debt consolidation to paying for a luxury trip. Since these are unsecured loans, you do not lose an asset for defaulting. But there are other consequences. When you fail to repay the loan, your credit score goes down, making it hard for you to get loans or credit cards in the future. Finally, you can only get personal loans if the EMI remains below 40%–50% of your monthly income. Types of Interest Rates On Personal Loans You can get a personal loan with either a fixed or a variable interest rate. For a fixed interest rate, the monthly payments will remain the same throughout the loan term. For a loan with a variable rate, the EMIs can change. So, you might have to pay different amounts each month. The fixed rate of interest is usually higher when compared to the variable interest rate. You can use an online EMI calculator to figure out how much your EMIs will be. This personal loan EMI calculator can also help you find out the overall cost of your loan. Benefits of Taking Out a Personal Loan The main benefits of getting a personal loan for a hair transplant or cosmetic surgery are Tailored to Your Needs Banks do not monitor the use of personal loans. So, you can use the loan amount for anything. They are perfect for unplanned expenses or a temporary financial crisis. You can pay for tuition, medical bills, house renovations, and other expenses. With a personal loan for a hair transplant or cosmetic surgery, you can pay for the surgeries without having to wait for your savings to catch up to the expenses, which could take years. High Loan Amount The minimum loan amount set by most lenders is ₹30,000. Some lenders may approve loans for a lower amount. This can also go up to ₹10 lacs. The maximum value depends on your salary, profession, and other factors. You can apply for the loan amount based on your need and repayment capacity. Flexible Repayment Time Personal loans range from a term of 1 to 5 years. This allows you to repay the amount with much flexibility. Selecting a loan tenure as per your comfort helps you plan your finances better. Easy to Avail You can apply for personal loans digitally. It only takes about 10 minutes to apply. In contrast, secure loans involve time-consuming processes. No Collateral Needed You can get personal loans without any collateral. You just need to submit your documents and income proof for approval. If you need a higher amount than the one you are approved for, you can also go for a co-applicant. Quick Approval and Disbursal The approval process can be completed within a week. It depends on the lender and how fast they process your documents. The processing time for personal loans is also little. The loan amount is disbursed within 24-48 hours of being sanctioned. Builds Credit Score Personal loans also help in building your credit score. When you pay the EMI on time and regularly, you build a positive score. This will help you in future when you need other credit facilities. High Acceptability Personal loans are available for both salaried and self-employed. Personal loans are approved for most people with a steady source of income and a stable credit record. Affordable Interest Rate The interest rate for personal loans can vary from 11.99% to 36%. It is a loan with the most flexible interest rates, which is a benefit for all applicants. Eligibility for a Personal Loan The criteria for personal loan eligibility varies between lenders. Generally, the following factors are important: Age Anyone aged 21-60 years is eligible for a personal loan. Income You need a regular income source, with a minimum monthly income of ₹20,000. Occupation You can be a salaried employee for public or private firms or be self-employed. Work Experience You should have worked in your current workplace for a minimum of 6 months. Self-employed people should also show proof of stable work. Credit Score A credit score above 750 is preferred by lenders. Documents You only require to submit your ID proof, address proof, salary slips, and bank statements. Some lenders may require additional documents. [B-02] Conclusion Cosmetic surgeries are becoming increasingly popular in India. Due to its high cost, you might hold off on getting the look of your dreams. But you do not have to wait any longer. By taking out a personal loan for a hair transplant and other cosmetic surgeries, you can keep your savings intact and still pay for expensive surgery. For quick and easy personal loans, try Piramal Finance. Get personal loans with zero prepayment and foreclosure charges, with a group of experts helping you through the process. You can also check out their other products and services to meet your financial needs.
08-11-2023
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Business Loan

Different types of secured business loans you should know about

When it comes to business financing, there is a range of options available. Each has benefits and drawbacks, from unsecured personal loans to traditional secured business loans. That’s why it’s essential to know about the different types of secured business loans before deciding. With this knowledge, you can make an informed decision regarding business financing. [B-01] What is a Secured Business Loan? Whether starting a business or restructuring an existing one, a secured business loan can help immensely. Secured business loans are loans backed by assets like real estate or equipment. Hence, banks feel more comfortable lending money to a company. Interest rates on secured business loans are usually lower than other types of loans, making them an ideal option for businesses of all sizes. Requirements for securing a business loan may vary depending on the lender, but most require some form of collateral. So if you’re looking for a loan to help grow your business, secured business loans are a great option. Types of Secured Business Loans Three types of secured business loans exist. These include commercial, revolving, and bridge loans. Each type has its benefits and requirements. Make sure to read the terms and conditions carefully before applying for a loan, as there can be a lot of hidden fees and terms. Business Loans There are three main types of business loans – line of credit, loan-to-value ratio, and term. When looking to take out a loan for your business, it is important to consider the type of loan that would suit you best. If you have a good credit score, a line of credit may be the right option. On the other hand, if your business has a lower credit score or no history of paying back debts, then a loan with low-interest rates and terms could work better. Car Title Loans A car title loan allows you to borrow money against the value of your car. The interest rate on a car title loan is high, so it is essential to research first and find a lender who will offer the best terms. Pawn Shop Loans Pawn Shop loans can benefit business owners immensely. It uses the assets of your business as collateral for the loan. This way, you don’t have to worry about losing anything if you cannot repay the loan in time. Life Insurance Loans Life insurance loans can be an excellent option for businesses of all sizes. They are secured by assets such as real estate, cars, or equipment and offer lower interest rates than unsecured loans. The loan terms usually last for a set period – usually between 3 and 5 years. Whether you’re looking to expand your business or take care of immediate cash flow issues, life insurance loans are the perfect solution. Benefits of Secured business loans Secured business loans can be a good option if you’re looking for a way to finance a business expansion or purchase new equipment. These loans are designed for businesses that need a good credit history or enough cash flow to qualify for a traditional loan. Larger Sums Secured business loans are the way to go when it comes to financing a business. They come with a lower interest rate and flexible terms that make them more suited for significant sums of money. Plus, you can apply for a loan from several lenders, so there’s bound to be one perfect for your business needs. Ensure you fully understand the terms before signing anything – not doing so could result in some surprises down the line. Longer Repayment Terms Among business loans, secured ones come with longer repayment terms and lower interest rates than unsecured loans. This makes them a good option if you want to repay the debt over time without worrying about high-interest charges. You can find secured business loans in various loan sizes, so there’s sure to be one perfect for your needs. Less Focus on Trading/Credit History Due to the global financial crisis of 2008, credit score ratings have become a significant factor in getting business loans. However, secured business loan options don’t place as much emphasis on credit score ratings and are thus easier to get approved for. Lower Interest Rates Lower interest rates are good news for businesses of all sizes. Thanks to secured business loans, getting the funds you need is a much simpler and faster process. Creditworthiness isn’t a concern with these loans as security measures back them. [B-02] Conclusion A secured business loan is a type of loan secured by collateral. This means the lender has the right to take possession of the collateral, such as assets if you cannot repay the loan. Several types of secured business loans are available, each with unique features and benefits. By understanding the different types of secured business loans, you can find the right loan for your business needs. If you wish for your business to grow, you need to choose the right business loan. One of the most effective ways to find a legitimate business loan is to consult experts at Piramal Finance. With their expertise, they will help you find the perfect loan allowing the growth of your business in no time.
08-11-2023
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Home Loan

Deduction On Home Loans Under Section 24

Many people dream of owning their own home but prices are constantly rising. Therefore, it is hard to purchase a house without a home loan. Getting a home loan from a bank or other financial institution is easy. But home loans have high monthly payments (EMI). A home loan interest deduction under Section 24 of the Income Tax Act covers tax breaks or deductions for home loan interest. These deductions can greatly help people who want to take a home loan to purchase a home and secure their future. [B-01] What Is Home Loan Interest Deduction Under Section 24 Section 24 of the Income Tax Act of 1961 considers the amount of interest a person pays on a home loan. This is also sometimes called deductions from income from house property. It lets you claim your home loan interest deduction under section 24. Under Section 24, the most you can deduct from your income tax is Rs. 1,500,000 and you do not have to live in that house to get a tax break. In the following situations, the income from a house is considered for tax deductions: If you rent a house, the amount you receive is income. If you own more than one house, the annual net value of all of them is counted as your income. But if someone only has one house and lives in it, the income from that house is considered to be zero. Types of Home Loan Interest Deduction Under Section 24 Under Section 24 of the Income Tax Act, there are two kinds of tax breaks: Standard DeductionUnder this section, 30% of the net annual value (NAV) is deducted from your income tax as a standard deduction. But this deduction does not apply to a home that the owner lives in. Home Loan Interest Any amount of property that is bought, fixed, built, reconstructed or rebuilt is exempt from paying taxes. So, if a home loan is taken out to do any of these things, the interest on the home loan is not taxed and can be deducted under Section 24. Here are a few important points to know about home loan interest deduction under Section 24: You can get up to Rs. 2 lakh in deductions if the home loan is for a self-occupied home. If you take a home loan for the purchase or construction of real estate (not renovation), you can still reclaim the interest. You can deduct pre-completion interest in five equal payments, starting in the year you buy or finish construction. If the home loan was taken out to fix or rebuild a house, you cannot get a tax break until the work is done. To take advantage of this home loan interest deduction under Section 24, you must figure out the interest you have to pay the bank or financial institution. Even if you have not paid the money to the lender yet, you can still get a tax break for the entire annual interest. Conditions to Claim Home Loan Interest Deduction Under Section 24 These are the conditions that people will be able to claim a home loan interest deduction under Section 24: 1. Tax Deduction up to Rs. 2,00,000 The taxpayer must use borrowed money to buy, build, fix, renew or rebuild the property. You took out a loan on or after April 1, 1999. You must buy or build the property within five years of the end of the fiscal year in which you borrowed the money. The taxpayer must first obtain a certificate from the lending institution to file a claim. The certificate must state how much interest the taxpayer has to pay to buy or build the house. It is not difficult to get this certificate which is typically issued by the bank or financial institution once a year at the start of the loan period. If you rent out the property, you can deduct the interest under Section 24. 2. Tax Deductions up to Rs. 30,000 If any of the above conditions are not met, you can still deduct up to Rs. 30,000 in interest. The loan must be taken out before April 1, 1999, and it must be used to build, buy, fix or rebuild a home. 3. Pre-Construction Deduction Pre-construction interest deductions are capped at Rs. 2 lakh, like post-construction. You cannot use the deduction if you use the home loan to fix or rebuild something. Each financial year, you can claim the deduction in 5 equal parts. The first payment comes in the same year the house is bought or construction is finished, whichever comes first. Exceptions For Home Loan Interest Deduction Under Section 24 Here are the exceptions for a home loan interest deduction under Section 24: If the owner does not live in the house, they can get a tax break for the whole interest payment and this exemption has no maximum limit. If the owner does not live in the house due to their job and lives in a rented home in their job location, they can get a tax break on the interest payment, but only up to Rs. 2 lakhs. To find a tenant or loan, you must pay no tax break for commissions or brokerage fees. The person who took out a home loan must have a certificate of interest. A person should buy or finish building a home within three years of getting a home loan to get a tax break on the loan’s interest amount. But if the purchase or building is not done within three years, Rs. 30,000 can be deducted instead of Rs.2 lakhs. [B-02] Conclusion Many people want to own their own homes. Therefore, knowing the different tax relief programmes might assist in organising taxes better. Section 24 of the Income Tax Act helps people save on home loan interest. So, if you plan to get a home loan, do not forget to take advantage of tax breaks. Piramal Finance is a great option if you are looking for similar articles that offer in-depth information and guidance on home loans and more.
08-11-2023
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Home Loan

Complete Guide On How To Choose The Best Home Renovation And Construction Loan In India

A home is much more than just a place where you sleep. A home is where you are peaceful. It signifies your accomplishments. Everyone wants to live in a gorgeous house. Beauty and comfort are as important as location and building quality. The quality and ambience of your house make an important first impression on your visitors. Make your home a reflection of your personality. You no longer need to wait until you have saved enough money to modify your property to your specifications. Instead, you can apply for a house renovation loan. You may utilise a house renovation loan to repair, or renovate your home. The major perk of a home repair loan is that it allows you to modernise your existing house and create a more inviting living era that is suited to personal tastes and styles. These loans are analogous to mortgages. A home loan enables you to buy a home, but a house construction loan allows you to renovate your present home. [B-01] What is a Home Construction Loan? A construction loan is a type of home loan. The bank pays out the money in phases as the job unfolds. To qualify for a home construction loan, you must present the lender with a precise construction timeline, building plan, and a realistic construction budget. After loan approval, the loan amount will be paid in phases based on the demand of each building stage. The lender would assess the site during the building or request a third-party engineer to come and inspect it. Features & Perks of a Construction Loan A home construction loan may benefit any person who wishes to build a house on their plot or an extra floor in their home. Lengthy service: A house building loan is offered for a long time, spanning 5 to 30 years. This implies that the borrower’s EMI load is low and the loan is cheap. Tax savings: Under Sections 80C and 24B, lines of credit, like house loans, are eligible for a tax credit on the principal and interest paid. Sections provide a tax credit of up to Rs. 2 lakh on the interest rate and Rs. 1.50 lakh on the principal. Section 80 EE permits first-time home buyers to receive an extra tax benefit of up to Rs. 50,000. Loan refinancing: You may also get a top-up loan on your current house loan. Banks examine your repayment history to assess if you qualify for a new loan to enhance your current loan. In rare cases, banks may charge processing fees for issuing a home loan top-up. Loan amount: Your income and payment criteria affect the amount of a home renovation loan you may get. Construction loans of up to 90% of the mortgage are available. To increase your eligible loan amount, you need to add a co-applicant. What Are The Various Types of Construction Loans? A debtor may choose one of 3 groups: Self-Construction Loan If you have bought or have a plot in your name and need funds to build a house, you may apply for self-construction credit. Plot + Construction Loan (P+C loan) If you do not yet have a plot and need money to buy it and build a house, a Plot + Construction loan is the ideal option. Remember that if you simply need money to buy a plot and not build a house, you must apply for a loan over property or a personal loan. Home Extension loan You may get a home extension loan if you need money to construct an extra floor or add a new space to your house. Similarly, a home repair loan may be obtained if you want to carry out major home repairs, repaint your house, or simply give your house a new look. How to Select the Finest Home Improvement and Construction Loan in India Need The first step is to choose how you will spend the loan fund. Make a list of all the activities and purchases you want to make for your home. This will help you plan your purchases properly. Eligibility After you’ve created a budget for yourself, you must look into the loan amounts open to you. You may also acquire proper interest rates based on your credit score. Options for repayment Select the payment plan and amount that best suits your needs and ability. You should choose an option that will not drain your bank account in the long term. Rates of interest Apart from your credit score, your loan size and term also influence your interest rate. You may choose between a fixed and variable rate based on your ability to pay back. Fee Check the processing fee for the loan being asked on top of the rates. Fees vary based on the pay plan. A huge charge might vastly raise the number of paybacks. Criteria to Get a Construction Loan The eligibility rules for home construction loans are similar to those set for traditional home loans. The following are some of the main criteria rules for loan applicants seeking home building loans: Availability: Home construction loans are often available both to resident & non-resident Indians (NRIs). A home building loan is available to both paid and self-employed persons. Age: Banks and house financing companies often accept home construction loan forms from people aged 18 years and over. They demand that borrowers completely pay back their loans by the time they turn 70. Duration: Users of home renovation loans may strengthen their eligibility for a construction loan by adding earning family members as co-borrower(s) or opting for a longer loan duration. Credit Score: Loans with credit scores of 750 or above have a better chance of getting home construction loans. Yet, certain banks and house financing companies may offer lower rates for house loans to users with better credit. Papers Needed for a Construction Loan The paperwork procedure for construction loans is identical to that of conventional home loans. The following are the primary papers needed to apply for a home construction loan: Identity proof Address proof Proof of age Proof of income Papers related to real estate Average build cost quote Completed form [B-02] Conclusion Remodelling your home may enhance its look, lift your emotions, and provide you with the satisfaction of proudly showing your home to family and friends. Access to easy construction loans helps you financially. The tax benefits that come with this loan enrich its features. To learn more about home renovation loans, visit Piramal Finance for related blogs and explore their products and services.
08-11-2023
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Electronics

COVID-19 Variants in India and the Current Vaccines for Them

Viruses can mutate and develop. When a virus copies itself, it can change in the process. A variant is a modified virus. Most changes to viruses are small, but some changes make viruses more dangerous which makes the vaccines less effective. Delta and Kappa are the names for COVID-19 variations from the Greek alphabet. B.1.617.1 is COVID Kappa, while B.1.617.2 is COVID Delta. India is where both of these variants originated. The AY.1 strain, a European Delta plus type, has also been found in India. This version sticks to lung cells easily. This article will explain the COVID-19 variants in India and how well their vaccines work. [B-01] COVID-19 Variants in India The virus was first found in China and since then, it has evolved into several variants. In India, there are different kinds of Coronavirus variants. The Indian SARS-CoV-2 Consortium on Genomics (INSACOG) has 10 labs all over the country. It is responsible for sequencing and keeping track of these different types. The Delta variant, first found in the UK, is thought to be the most common in India. A report from INSACOG says that the Delta variant is now the most common strain in India. It makes up more than 75% of all COVID-19 cases in the country. Alpha, Beta, Gamma, and Kappa are the other virus types. It is thought that each of these variants is more contagious than the original virus, but their severity is still being studied. COVID-19 Variants As Per WHO Alpha B.1.1.7 Beta B.1.351 B.1.351.2 B.1.351.3 Gamma P.1 P.1.1 P.1.2 Delta B.1.617.2 AY.1 AY.2 AY.3 Eta B.1.525 Kappa B.1.617.1 Iota B.1.526 Lamda C.37 Overview of the Delta Variant The B.1.617.2 variant, the Delta variant, is thought to be related to the second pandemic wave, which hit India in the middle of 2021. The Delta variant is 50% more likely to spread than the original virus and it is also thought to affect younger people more than those who are older. Impact of COVID-19 Variants in India India suffered greatly due to COVID-19. Of the COVID-19 variants Delta caused the second pandemic wave, which led to a huge rise in the number of cases and deaths. It has also spread quickly in rural areas, where health care is not as well developed and accessible as in urban areas. The Government of India adopted certain measures to stop the virus from spreading such as lockdowns, curfews, travel restrictions and more. Vaccines For COVID-19 Variants in India In India, there are four different kinds of vaccines: Covaxin Whole virus vaccines employ a weak type of virus that can still replicate. Another way is to use a virus in which all of the genetic material has been destroyed but still makes the immune system react. One vaccine that fits into this group is Covaxin. Covishield and Sputnik V A vaccine with a viral vector also tells cells how to make antigens. But unlike the nucleic acid vaccine, this one uses a harmless virus like adenovirus to get the immune system to react. In India, two of these vaccines are Covishield and Sputnik V. Corbevax Viral protein fragments trigger an immunological response in a protein subunit vaccination. This is where the new Corbevax vaccine fits in. It was available in September 2021. Moderna The nucleic acid vaccine instructs cells to manufacture an antigen, which stimulates an immune response. This is the case with the Moderna vaccine. In terms of how well they work, a study found that the Covishield vaccine from AstraZeneca is effective against the Indian variant, Delta B.1.617.2. This vaccination was 60% effective in two doses against the Delta type. Researchers have also found that Covaxin is 61% efficient against the same variant. Trials indicated Sputnik V to be 78.6% to 83.7% efficient, while the Delta variant’s drop in efficacy is insignificant. Current Vaccination Strategies for COVID-19 Variants The Government of India has been using different vaccination strategies to fight COVID-19 and its many variants: The first step is to ensure that people get their vaccines. All those above 18 who live in the country can get free vaccines. The Government has also advised people who have already had the virus to get vaccinated. This protects them from other variants and ensures that they do not face the severity of COVID-19 again. The Government has set up a tiered vaccination system for high-risk groups like healthcare workers and the elderly. This ensures that those who need protection the most get it first. State/UTTotal DosesAndaman And Nicobar9,91,0051Andhra Pradesh11,05,41,231570Arunachal Pradesh19,04,914855Assam5,02,70,5511,013Bihar15,71,14,2982,530Chandigarh22,80,78352Chhattisgarh4,90,64,1103,812Dadra & Nagar Haveli and Daman & Diu15,78,2972Delhi3,73,47,885818Goa28,72,33311Gujarat12,76,84,7162,679Haryana4,54,39,627630Himachal Pradesh1,52,40,8361,896Jammu and Kashmir2,47,24,773547Jharkhand4,35,67,8574,518Karnataka12,07,41,9582,418Kerala5,74,66,100796Ladakh5,63,29657Lakshadweep1,45,0080Madhya Pradesh13,35,59,4241,425Maharashtra17,75,88,6912,963Manipur32,64,48090Meghalaya26,19,99492Mizoram17,90,1010Nagaland17,37,15534Odisha8,14,39,777164Puducherry22,66,651214Punjab4,69,46,564612Rajasthan11,51,79,4514,900Sikkim13,60,30486Tamil Nadu12,73,69,3221,846Telangana7,71,62,871824Tripura59,10,691168Uttar Pradesh39,04,84,8984,145Uttarakhand2,00,34,085869West Bengal15,59,30,572869Miscellaneous52,95,7130 How To Stay Safe From COVID-19 Variants To stay safe from COVID-19 variants, it is important to adopt certain measures. The first and most important step is to get vaccinated. It is also important to follow basic safety rules, like wearing a face mask, keeping your distance from other people, and staying away from large groups of people. People should also be extra careful when they travel, especially to places where variants are more common. [B-02] Conclusion Ultimately, COVID-19 variants have caused a lot of trouble. The Government of India has invested money into making more effective vaccines to fight the variants. But to stay safe from the variants, taking certain steps is vital. People are encouraged to continue following safety protocols to stop the spread of the virus and this includes getting the vaccine. For more information on COVID-19 variants and the vaccines to treat them, visit Piramal Finance to read more helpful articles like this one.
08-11-2023
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