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Home Loan

A Complete Guide to Applying for Home and Mortgage Loans Together

Every person wants to own their own home. It is a way to ensure you have security for the rest of your life that you can’t get from renting a house. But it is not easy to buy a house. The process of buying a home is detailed, from saving for years to put down as a down payment to finding a good place to invest. Most people think that getting a home loan is the best way to buy property because it costs a lot of money. You can get a home loan and pay it back in easily Equated Monthly Instalments (EMIs) over up to 30 years. [B-01] How Does a Home Loan Work in India? Home loans are a contract between borrowers and lenders. In most cases, the bank or NBFC directly pays the owner or builder the home loan amount instead of the borrower. Borrowers typically repay their loans in EMIs over the course of their chosen repayment period, with interest added to the principal balance. You can now get a home loan at one of the lowest rates in the industry, with a lot of openness and trust. In India, it only takes a few steps to apply for a home loan. Before digital banking, these steps were hard to understand and took a long time. The process of getting a home loan today is not only easy but also quick. Most loans are disbursed to you within a week after all the necessary paperwork and checks from the bank. How to Get a Mortgage Loan in India Here’s a step-by-step look at how to apply for a mortgage loan: Fill out the form to apply The first step in getting a housing loan is to fill out an application form. It is the most fundamental document. You must include basic information about yourself, including your name, address, mobile number, profession, monthly and yearly income, educational background, etc. You should also describe the property you want to buy, how much it will cost, and the down payment you can pay. Additionally, you must submit documentation, i.e., proof of identity, address, income and tax returns for the last three years, and other financial documents. Document verification It’s important to know that many people apply for mortgage loans every day. Making sure your paperwork is in order will speed up the time it takes to process your application. At this point, the lender checks the information given by you. The lender focuses on the following papers: Residential address Employment details Credentials of the employer Phone number Employer number Background checks Banks check all the documents and do a background check on the borrower. In order to do this, the bank may look into the information you put on the form. Getting your credit report is easier now that RBI has made it a requirement for credit reporting agencies to give their customers a free credit report once a year. A credit score above 750 is good, and it shows how reliable a person has been in paying back loans in the past. Pay a fee for processing After the loan application has been sent in, it is crucial to pay the loan processing fee. Processing fees can differ from one lender to the next. Home loan processing fees are usually between 0.25 and 1 percent of the amount borrowed. Lenders charge customers a processing fee to cover the costs of managing their loan accounts. The agent’s commission may be rolled into this total. You can always talk to the lender about the processing fee to get a good offer. Even though banks and NBFCs have a set way of figuring out the processing fee, there is no harm in asking for the processing fee to be lower. Check your repayment ability The most important part of getting a home loan is ensuring the borrower can pay it back. Your request for a home loan will be approved or turned down by the bank based on how confident it is in your ability to pay back the principal and interest on time. If the bank gives conditional approval, then all of the conditions must be met before the loan can be paid out. It is wise to take a loan based on your income and ability to save enough money for monthly EMIs. Take care of the property papers After you get an official letter approving your loan, you must hand over the documents to the lender. The bank keeps these documents until the loan is paid off in full. The original property documents usually show the entire chain of ownership acquisitions and transfers until you sign the Sale Agreement. They also show the seller’s name, ID, and proof of address, among other things. Before approving the loan, the bank checks all the property documents. The bank also sends a representative to the property twice, before and after the loan is approved. Loan disbursement Lastly, after all of the paperwork is done, the loan is disbursed. The creditor may ask you to prove that you have saved up for the down payment. Loans are typically disbursed to the seller or developer of the purchased property. Different lenders have different times for giving out loans. Some move quickly and give out the loan as soon as all the criteria have been met, while others take longer to get everything in order. [B-02] Conclusion With a home loan, you can buy the house of your dreams. You should do a lot of research on the loans that different banks offer. Digitalisation in India has made the process of getting a home loan simple and quick. You can apply for a mortgage simultaneously with a home loan. Make sure to have the required paperwork to make the process quicker. Piramal Finance can help you make smart and wise financial decisions. Check out more blogs on their website!

08-11-2023

Education

Benefits Of FASTag And How To Get One

There are hundreds of cars are parked at toll plazas on national roads, waiting to pay the toll before continuing on their route. Paying the toll with cash and getting a ticket is often exceedingly sluggish and time-consuming. For hassle-free travel on public roads, FASTag is the ideal answer. Currently, FASTag is active at more than 420 toll booths on state and federal roadways. In the future, more toll booths are anticipated to be included in the FASTag programme. The toll charge is taken from the prepaid account connected to the FASTag. After the tag account is operational, the tag is attached to the vehicle’s windshield using Radio-frequency Identification (RFID) technology. The FASTag scheme promises to expand its network of toll booths over time and to operate completely cashlessly across India. [B-01] Advantages Of FASTag Some FASTag features and benefits include: Time-SavingThe time people wait at toll booths drastically decreased when FASTags were introduced. Since you don’t need to stop at a toll plaza to pay the toll fees, you save a lot of time and fuel. Simple to RechargeThe easy online recharging option of a FASTag is one of its most significant advantages. You may connect your FASTag to your bank account. Make sure there is enough money in your bank account to cover the toll payments. An NHAI wallet is another option for paying the toll costs. This prepaid wallet may be reloaded using many methods, including NEFT, UPI, debit cards, checks, and online banking. Five Years is the Validity PeriodFive years are the long-term validity of a FASTag. During this time, you may take advantage of cashless toll payments without constantly buying fresh ones. Remember that your bank account must be operational, or the amount in your NHAI wallet must be adequate. Simple Registration ProceduresThe FASTag registration procedure is straightforward. To sign up for a FASTag, go to a bank, a few stores, or a Point of Sale (PoS) facility at a toll plaza. Visit the website of any of the top FASTag issuing banks to register online instead. Environment-FriendlyBecause FASTags don’t need receipts or cash, they have removed the need for paper. Additionally, you consume less fuel since you don’t have to spend much time in a toll plaza line. Keeping Tabs on Your SpendingYou will be notified through email and your registered cell phone number when the toll charge is taken out of your bank account or prepaid wallet. The FASTag platform also allows users to verify FASTag assertions. As a result, you can keep track of the money you spend at toll booths. You May Use a Monthly Travel Pass: If you travel often, you can use an online method to upgrade your monthly pass to a FASTag pass. How To Use FASTag? Purchase a FASTagGetting a FASTag for your automobile is the first step. By bringing your ID and the registration papers for your automobile, you may physically purchase one at several toll plazas around India. Even banks and other websites like Paytm and others sell FASTags. The FASTag may be pre-linked with your bank account for simple later recharging if you purchase it from the bank. Adding the FASTag balance After then, you must pay for the FASTag. Depending on the seller you choose to purchase from, different costs for the FASTag may be applicable. FASTag will cost you around Rs 500 if you get it through Paytm, for instance. This sum consists of Rs. 100 for the tag, Rs. 250 for a refundable security deposit, and Rs. 150 for your FASTag’s first recharging.The Paytm-issued tag has a minimum barrier of Rs 150 as well. However, if you choose to purchase from HDFC Bank, the price of the tag is Rs 400; this sum consists of Rs 100 for the tag, Rs 100 for a reissue, and Rs 200 for a security deposit. In addition, HDFC Bank has set a minimum barrier of Rs 100 to keep your account active. Not just that. Every time you use this, you’ll also get cashback. Issuers of FASTags sometimes make these offers. Filling Up the FASTag BalanceThe next step is to recharge the FASTag’s balance. You may use your bank account to recharge the FASTag by logging onto the payment system of the bank that issued it.Alternatively, if you purchased it using Paytm, you may recharge your associated Paytm account, and the amount will be taken out each time you cross a toll booth on a public road. Additionally, you may download the “My FASTag” app and recharge your FASTag there using the UPI. How To Buy And Recharge A FASTag? Digital FASTags FASTags may be ordered online from the websites of Issuer Banks, NHAI, and IHMCL, and the courier will deliver them to the buyer’s door. Mobile ApplicationMy FASTag is a consumer app in the App Store for iOS and Android devices. On this app, users may buy or recharge FASTags. Additionally, the app offers online grievance resolution and transaction tracking. POS Users may also establish tag accounts by going to any Point of Sale (POS) facilities of the authorised issuing banks in Toll Plazas or Banks’ sales offices. Twenty-three banks permit the issuance of FASTag in the public and private sectors. Consumers may call the Issuing Bank Customer Care lines to find the nearest POS station. Users must bring the original and a duplicate of their KYC papers to the POS or Sales office location. It’s crucial to bring the car to the POS or sale office so you can buy the FASTag. [B-02] Summing Up The Government of India established the FASTag to alleviate the inconvenience of standing in a lengthy line at a toll plaza. A FASTag is a reloadable tag placed on your car’s windshield and automatically deducts the toll money to allow for rapid and simple vehicle passage over the tolls. To read more about FASTag, visit the Piramal Finance website.

08-11-2023

Business Loan

All The Ups-Downs You Need To Know About Business Loan Interest Rate In 2022

Are you looking for the best place to find a business loan interest rate in 2022? Do you want to know more about an online business loan? Then you are in the right place. Now that you know more about the many types of business loans available and the associated interest rates, we need to discuss the various factors that influence the rate a lender provides you. This will allow you to plan with certainty in terms of money and other necessities. You may use them to negotiate better conditions with the bank while taking online business loans, perhaps resulting in lower interest payments. Regarding loans, it’s crucial to remember that it’s better to be overprepared than underprepared. Let’s take a closer look at these issues. [B-01] The option of a bank or a credit union The biggest factor that impacts your interest rate is who you borrow money from. Credit unions and banks may provide cheaper interest rates than other online business loan providers, but they also have tighter guidelines about who may borrow money and how it can be utilised. As an alternative, online business loan banking services provide means to get money with fewer restrictions on who may obtain it and how much they can spend. However, when all prices are considered, they may be expensive. Your particular credit score Your credit history and score are critical when applying for a small online business loan. Remember that lending businesses are careful about where they lend money. They will know you can be trusted with money if you have a solid credit score and history. It may even help you obtain a lower interest rate for an online business loan. However, a low FICO score does not automatically exclude you from obtaining a loan. Many internet lending organisations are eager to deal with loans that do not have the finest credit history. Remember that the interest rate you are given may be more than you anticipated. Also, if you are concerned about your credit score, you should begin working immediately to eliminate your debt. If you don’t have much credit history, you might acquire a new credit card and focus on improving your credit score before applying for a business loan. Security When you borrow money, you may be required to put up collateral, such as the value of your house, vehicle, or other possessions. While not all commercial loans need collateral, certain banks may provide a higher rate if you provide a guarantee. You may be able to acquire a cheaper business loan interest rate if you have collateral, but if your firm fails and you have taken out a loan, your assets may be taken away. Borrowing Terms The conditions of how you repay the online business loan will also have an impact on the interest rate you pay. Loans with longer repayment terms often have cheaper monthly loans. However, keep in mind that loans with longer durations often have higher overall interest costs. The sort of loan you want to get The online business loan you choose determines a portion of the interest rate you agree to pay. As a result, company owners must carefully consider their financial requirements. As a result, consumers will spend less time on loans that will not benefit them as much and more time on loans that will. Money is essential at home and work Finally, your personal and corporate circumstances may affect the business loan interest rate on a loan. Suppose your company is already up and running, and you want to seek finance for expansion. In that case, lenders will look at how long you’ve been in business, how much money you generate each year, how excellent your business credit is, the kind of organisation you have, and how you intend to utilise the money. Finally, this determines how hazardous it is to lend you money and what your business loan interest rate will be. How much do interest rates on business loans alter or remain the same? Small company loans might have fixed or variable business loan interest rate which affects how payments are paid. You may wonder what the primary difference between variable and fixed-rate loans is. Then, let’s go further into these distinctions. Loan interest loans may fluctuate On the other hand, a variable-rate loan does not necessarily have a fixed interest rate, and it normally starts cheaper than a fixed-rate business loan interest rate. However, this rate may vary due to the nature of the market. As a consequence, your monthly payments may vary. It may also be more difficult to create long-term budgets that you can rely on. However, you may obtain either the lowest or highest interest rate available with variable rates. So keep this in mind when determining what kind of loan you want to receive. Fees associated with a loan are referred to as Online business loan requires you to pay interest and other expenses. The most significant of them is the loan fee. The total amount of interest you pay on your loan will be determined by the following: Consider your FICO score. What kind of loan is it? The financial institution (bank or credit union) How much money do you need to borrow? How will payment be made? Lenders must be upfront about all fees and business loan interest rates from the outset. If they aren’t, you should consider applying with another lender since you don’t want to be startled by high fees. This post will look at the most frequent charges associated with business loans. Costs that may be covered Lenders will assess an “underwriting fee” depending on your creditworthiness. Checking references, looking at financial documents, and checking credit ratings are all part of the process. Fee at the outset The loan origination charge is a one-time cost paid at the start There is the SBA Guarantee Fee The charge for an SBA loan guarantee varies from 0% to 3.75%. This, however, will be determined by the amount of online business loan you need to borrow. As a result, the quantity of your loan will increase the percentage rate you pay. The final expenses are determined at the closing table On the other hand, closing expenses are associated with how your online business loan will be paid for. For example, if you wish to acquire a company or get a business loan, you may be required to pay for professional loans such as legal advice. The many sorts of company loans and how to evaluate them You may be concerned about comparing business loan interest rates now that you know more about the many types of business loans, their interest rates, additional loan expenses, and eligibility conditions. Annual percentage rates are often used to compare business loan interest rates. This yearly rate covers the interest and loan charges, which we’ve previously discussed. This will estimate how much you’ll have to pay each month after getting a loan. However, remember that these rates may vary based on various circumstances, including your credit score and the amount of money you have. Your lender may also provide you with information that you can input into a business loan calculator to see how much it will cost you each month to repay the loan. A list of the papers required to apply for a commercial loan Applicants must provide the necessary papers to the lender as part of the online business loan application procedure. While this article does not detail what you need to apply to a particular organisation, these are some of the most typical documents you’ll be requested to bring. This way, you’ll be prepared for every stage of the application process, which should speed things up: Credit report information and status If relevant, the company’s credit history and credit score. Yearly earnings and income How Much Is Your Work Time Worth? When your loan payments were divided by your income, Please indicate the assets that will be used to secure your loan. What market segment do you operate in? A business strategy that includes a plan Your bank statements A copy of your company’s lease, if you have one. Employees, how many Social Security cards do they have? Legally binding agreements and contracts The foundation papers of the firm Please describe how you intend to utilise the funds from your business loan. When you pay income tax on your own money Taxes based on how much money a company earns What exactly is a balance sheet? Any additional financial responsibilities must also be specified, whether commercial or personal A legitimate registration or incorporation certificate that allows a business to operate Establishment Permits Wage and hour records in two copies Making preparations for commercial insurance Who owns what, and to whom do they belong? Proof of a diversity permit or a federal passport [B-02] Conclusion It may be difficult to comprehend how interest rates operate with an online business loan if you have never taken out a loan. But now that you’ve read our article, you should better understand the distinctions between the various kinds of loans and their expenses. How fixed and variable interest rates affect your entire financial picture. Before asking for an online business loan, you should consider what your company needs. As a result, you will not have to spend time applying for loans that do not suit you or have exorbitant interest rates. Instead, you may concentrate on obtaining the best financing for your specific requirements. Investment Reliable doesn’t give financial advice, but we provide unbiased information and reviews about trading, investing, and finance. Users should always look into things on their own. There are also more in-depth, educational articles on Piramal Finance.

08-11-2023

Home Loan

Unlock Festive Joy with the Best Home Loan Offers at Piramal Finance

Do you dream of having your home under your or your parent’s name? If yes, you are not alone in this wide world dreaming of making a home with your hard-earned money. However, buying a home requires a lot of money, calculations, perfect timing, and luck. And if one of the things from the list goes missing, you may never find your dream home. Suppose you have been thinking of buying a home for a while, in that case, the festive season is the right time for you to go ahead and make your dream come true. The festival season is when most people look to buy a new home, car, electronics, etc. The festive season brings huge discounts and offers, making it an ideal time to purchase a new home. Taking the benefits of the festival season allows you to reduce the cost of borrowing, making it a bit easy for you to pay for your dream home. However, these festive offers help builders and banks increase sales, making it a win-win for customers and businesses. Now let’s look at the most amazing and beneficial festival season offers for home loan takers. [B-01] Benefits of getting a home loan in festival season Money lenders are waiting for you in the festival season to get a home loan and fulfil your evergreen dream of building and making a home with your own hands. You are applicable for taking a home loan if you are taking it as a new loan or creating a balance transfer. However, salaried and self-employed individuals can also apply for home loans and avail of the all-new benefits and offers of a home loan. The following are the benefits you will get on applying for a home loan during the festival season. Decreased interest rate A festival season may allow you to build your dream home with fewer interest rates on home loans. For example, many lenders discount interest rates from 0.50% to 1.00% during festival seasons. Therefore, a decreased interest rate may lead to fewer EMI amounts, resulting in fewer borrowing costs. For example, If you take a home loan with a 7% interest rate of Rs 50,00,000 for ten years, the EMI will be Rs 58,054. However, if you take the same loan amount during a festival season at a decreased interest rate of 6%, your EMI would be Rs 55,510. Fewer or zero processing fees or other charges You may not count processing fees or count them as a miscellaneous cost while taking a home loan. But for many home loan takers, it increases the actual home loan amount and may increase the overall expense. Therefore, taking a home loan during the festival season allows you to have fewer or zero processing fees on your home loan. On the other hand, the lenders decide to cut down the processing fees to acquire more new customers. EMI waiver Many lenders decide to waive off a certain amount of EMIs to be paid by the borrower. For example, XYZ lender waives off X number of EMIs from the total EMIs; you will directly save the X numbers of EMIs per month. However, these discounts and offers come with specific terms and conditions. You must wait to foreclose the loan. It is not prominent that every lender will indeed waive off certain numbers of EMIs. Remember that some lenders may come up with different offers and benefits for home loan seekers. Easy to apply Festival season is beneficial for both lenders and customers. And it’s a great opportunity for businesses to increase the number of applicants. However, applying for a home loan is a tedious task, and many customers find a secondary way of hiring an agent for the processes to tackle. Therefore, the lenders, during the festival season, may decide to decrease a few steps for a home loan to make the application easy to apply. As digitization happens, you can easily apply for a home loan online from the lender’s website, where you can submit the application form in a few minutes. However, during the online application process, if you find any difficulties, the company will provide you with direct assistance online, or you can visit their office for further clarification on the process. The best offers from builders India is making rapid progress in every industry and sector. And the real-estate sector is booming with multiple high-rise construction projects to economy projects for middle to lower-middle-class people. Due to the high competition in the real-estate sector, builders have come up with multiple offers to attract customers. However, during the festival season, most builders decide to release a new offer or discount on the pricing of the home or sometimes decide to add complementary home furnishing items along with the home. And sometimes, builders add freebies, including gold coins or free parking for the customers who pre-book the home during a specific period. [B-02] Final thoughts It’s auspicious to buy anything new during the festival season, be it a new home, car, electronics, or anything you need. However, everyone dreams of buying their own home, so a home loan would immensely help you when you decide to process it during the festival season. However, one should never decide to take a home loan by only looking at its offers and benefits; it provides, instead looks at its overall impact on your financial goals and conduct thorough market research before applying for it. After all, a home loan is a loan you need to pay back. And you are bound to pay the money back, which isn’t yours until you repay all of it. Are you planning to process a home loan? Visit Piramal Finance for smooth, and cost-saving home loan options.

08-11-2023

Schemes

Am I Eligible to Invest in the National Pension Scheme (NPS)?

The National Pension Scheme, or NPS, is a voluntary retirement plan, which encourages working professionals to save money for retirement. Introducing National Pension Scheme The National Pension Scheme is a Government of India initiative. It was started in 2003. Initially, only the employees of the government sector were eligible to avail of the scheme. In 2009, however, changes were made to the scheme. These changes now allowed people working in the public, private, and unorganised sectors (except the armed forces) to benefit from this scheme. [B-01] Indian citizens aged 18 to 60 are eligible for this scheme. A minimum of INR 6,000 per year or at least INR 500 per month in installments must be invested to meet the eligibility of this scheme. The National Pension scheme has a maturity of 60 years, which can be extended up to 70 years. The scheme can help you secure funds after retirement by taking good financial decisions. All these factors make the National Pension Scheme a sustainable solution for senior citizens who might face financial troubles after retirement. The interest rates offered under the NPS are 8 to 10%, and the NPS savings are pooled in a pension fund. The NPS is regulated by the Pension Fund Regulatory & Development Authority (PFRDA). The NPS allows a partial withdrawal of about 25% of the total amount after three years of opening an account. This is allowed only under special situations like purchasing a home, funding your child’s higher education, or health emergencies. Benefits of the National Pension Scheme The National Pension Scheme offers a range of benefits. This is why many people have started investing in NPS since it came around. Here are some reasons to start investing in NPS: NPS offers flexibility: The National Pension Scheme offers a wide range of investment options like pension funds (PFs). These can be used for planning future finances. As an investor, you can also change the of investing. Your NPS account can be easily monitored. NPS offers simplicity: Opening an NPS is easy if you have a PRAN (permanent retirement account number). With your unique PRAN number, which remains the same for a lifetime, the whole process becomes quick and easy. You can open two kinds of accounts under NPS: Tier 1 is a non-withdrawable permanent account. Tier 2 is a voluntary withdrawable account, which can only be activated when a Tier 1 account exists. Portability: NPS is seamless and has immense portability. Even if you switch between jobs or locations, your NPS account can be transferred. A very hassle-free system allows changes to be made to the account just as quickly and easily. Well regulated: It is very well regulated by PFRDA. Opening an NPS account is transparent, enables regular monitoring, and offers the least account maintenance cost. Compounding and low-cost investment: An NPS account requires minimum investments. And the account maintenance cost is low. In addition, the benefits of compounding interests are highly beneficial to you as investors. Easy online access: Online platforms make managing and investing in NPS easier and more convenient. Good returns/interests: A portion of your investment goes into equities investment. This kind of investment offers high returns as compared to other traditional tax-saving investment schemes. The interest rates are as high as 9-12%. Tax benefits of NPS: Accounts with a maximum limit of INR 1.5 lakh are eligible for tax exemption under Section 80C of the Income Tax Act. The 100% withdrawal after 60 rule prevents the temptation to withdraw money before maturity. As an investor, you get a lump sum of money only after 60. Risk assessment with NPS is very accessible. Eligibility Criteria for Investing in National Pension Scheme Let us come back to the initial question, i.e., are you eligible to invest in NPS? Check these criteria out to know your eligibility. You can also find out whether you should or should not invest in NPS: Aspiring investors should be Indian citizens. Even NRIs are eligible to invest in NPS. The investor should be 18 to 60 years of age when they apply. KYC (Know your Customer) submission is necessary. You should have a subscriber registration form. It needs to be submitted with proof of identity, address, date of birth certificate, and point of presence. A twelve-digit PRAN number is necessary. If you meet these criteria, you can start investing in NPS. How to open a National Pension Scheme Account A National Pension Scheme account can be opened offline or online. The online process involves the following steps: You can create an account on the NPS official website in less than 30 minutes. You must link your PAN, Aadhar, and registered mobile number with your NPS account. An OTP will be sent to your registered mobile number. It will let you verify yourself and generate NPS login details. To open an account offline, you can follow these steps: Find a point of presence or POP registered with the Pension Fund Regulatory and Development Authority Collect a subscriber and submit it along with the KYC paper Invest with an initial amount that lets you get a PRAN or Permanent Retirement Account Number [B-02] The Indian economy is advancing in every sector. There is a growth in investments and awareness towards saving. The future, however, is unpredictable. So you must plan. Piramal is a leader in the investment market. Our experts can help you invest right. You can find more information and guidance about personal loans and finance at www.piramalfinance.com.

08-11-2023

Tax

All About Business Loan Tax Deduction Under Section 80C

People who have taken loans for business are entitled to certain tax deductions under Indian income tax laws. Section 80C of the Income Tax Act allows a deduction for the interest paid on loans taken for businesses. The deduction is available for both new and existing businesses. To claim this deduction, you must be able to show that the loan was used for business purposes. The deduction is limited to the amount of interest paid during the year. If you are planning to take out a business loan, it is important to understand how the tax deduction works. This will help you maximise your tax savings. Continue reading to learn more about business loan tax deductions under Section 80C. Section 80C Business Loan Tax Deduction A business loan tax deduction under Section 80C is a deduction that businesses can claim on the interest paid on their loans. The deduction is available for new and existing loans and can be claimed for up to five years. To claim the deduction, businesses must provide evidence of the loan agreement, repayment schedule, and interest paid. The deduction can be claimed in the year the loan is taken out or in subsequent years. The maximum amount that can be deducted yearly is Rs 1 lakh (Rs 100,000). This limit applies to all deductions under Section 80C, including those for home loans, education loans, and life insurance premiums. The business loan tax deduction under Section 80C can save businesses thousands of rupees a year in taxes. It is an important tool for businesses to reduce their tax liability and improve their bottom line. Business Loan Tax Deduction Calculation To calculate a business loan tax deduction in India, you will need to follow these steps: Determine the eligible amount of the business loan. The eligible amount is the total loan minus any prepayment penalties or fees. Calculate the interest paid on the business loan. This can be done by taking the eligible loan amount and multiplying it by the interest rate. Add the calculated interest payment to your other business expenses when filing your taxes. The total amount of deductions for all business expenses cannot exceed 50% of your total income from the business. Types of Business Loans that Qualify for a Tax Deduction Under Section 80C There are many types of business loans that qualify for a tax deduction: Home loans: Under Section 24 of the Income Tax Act, home loans used for business purposes are eligible for a tax deduction of up to Rs. 1.5 lakhs per year. Auto loans: Auto loans taken for business purposes are eligible for a tax deduction of up to Rs. 1 lakh per annum under Section 80E of the Income Tax Act. Education loans: Under Section 80E of the Income Tax Act, education loans taken for business purposes are eligible for a tax deduction of up to Rs. 1.5 lakhs per year. Personal loans: Under Section 80C of the Income Tax Act, personal loans taken for business purposes are eligible for a tax deduction of up to Rs. 2 lakhs per year. Machinery loans: Similar to vehicle loans, you can deduct the interest paid on machinery loans used for business purposes. Startup loans: Many startups take out loans to get their businesses off the ground. The interest paid on these startup loans can be deducted from your taxes. Working capital loans: Often, businesses need extra funds to cover their day-to-day expenses. The interest paid on working capital loans can be deducted from your taxes. Business Loan Tax Deduction: How Much Can Be Saved? Assuming your business is structured as a pass-through entity, such as an LLC or sole proprietorship, the loan proceeds are generally taxable. However, you may deduct a portion of the loan as business expenses if the funds were used for business purposes. Let’s see how much can be saved in taxes. For example: If the business owner takes a loan for business purposes and pays interest on that loan, then she can avail herself of a deduction for the interest paid under Section 80C of the Income Tax Act. The maximum amount that can be deducted is Rs 1.5 lakh per financial year. This deduction is over and above the limit of Rs 1.5 lakh that can be claimed under Section 80C for other deductions such as investments in PPF, life insurance premiums, etc. Thus, if a business owner takes a loan of Rs 10 lakhs at an interest rate of 10%, she can claim a deduction of up to Rs 1.5 lakhs on the interest paid every year. This effectively reduces her annual tax liability by up to Rs 45,000 (30% * 1.5 lakhs). These significant savings can be used for other important expenses, such as growing the business or personal needs. Ways to Claim Business Loan Tax Deduction Under Section 80C Assuming that you have obtained a business loan for your company, you can claim a tax deduction under Section 80C of the Income Tax Act of 1961. The maximum deduction amount is Rs. 1.5 lakhs. To avail yourself of this deduction, you must submit various documents to the lender, such as: Your business loan account statement for the financial year A copy of your income tax return filed for the previous year A certificate from a chartered accountant certifying that the loan has been used for business purposes Once you have submitted these documents, the lender will calculate the eligible deduction amount and send you a confirmation letter. You can then claim the deduction by submitting this letter to the Income Tax Department. Tips for Section 80C Business Loan Tax Deductions Remember a few things to remember while claiming business loan tax deductions under section 80C: Make sure your business loan is for a genuine business purpose, not personal use. You can claim tax deductions on the interest payments made on the business loan under Section 80C of the Income Tax Act. The maximum amount you can claim as a deduction under this section is Rs 1.5 lakhs per financial year. You must submit all supporting documents and income tax returns to claim the deduction. [B-02] Key Takeaways You can save money on your taxes with the right business loan tax deduction. Be sure to talk to your accountant or financial advisor to see if this could benefit you and your business. If you’re interested in learning more about the business loan tax deduction under Section 80C, visit Piramal Finance, where you can read more articles like this and get started on your business loan taxes with the aid of a professional.

08-11-2023

Business Loan

All The Advantages Of Online Business Loans You Need To Know

The satisfaction of being in charge and making decisions comes from owning a business. However, despite the positive note, it has another side. The difficulty and pressure of raising funds for your business. When you have representatives working for you, there is also the fear of uncertainty and the tension of making the right choice. The asset you’re willing to make in top-of-the-line equipment, and staffing with highly skilled workers are critical to your company’s expansion. A business loan is an answer to this problem. With business loans, you can hire new employees, get new pieces of equipment, and also buy raw materials to take advantage of deals and meet seasonal demand. [B-01] Top 7 Benefits of Online Business Loan Online business loans can be beneficial for various purposes, but there are some well-known benefits. Let’s discuss some of the benefits of an online business loan. 1. Convenient and Flexible Online option is the fastest way to get a business loan. You do not need to submit voluminous documentation before submitting your application; instead, you wait for it to be submitted and approved. Digital verification of documentation is used as much as possible, which saves a lot of time. Processing speed is essential when you need an emergency loan, as offline sources would not only be slower but also prove to be more expensive given your desperate need. You can easily apply for a loan from the comfort of your home; no need to wait in long lines in banks to get a loan. It saves time and effort as online moneylenders are available online 24 hours 2. No collateral Collateral is a monetary asset you provide to the bank while requesting a loan. You can easily apply for a loan online without worrying about the collateral and still get up to 25 lakhs. Online Business loans are completely unsecured, unlike other types of loans that require borrowers to put up an asset, such as their home, as collateral. It means you can immediately get money for your business. As a result, getting a loan without collateral makes it easier for business owners to earn money and keep their businesses going. 3. Easy To Avail Obtaining a business loan online is much easier and more convenient than searching for investors and having lengthy discussions. When you need an emergency loan, processing speed is especially helpful as offline sources would not only be slower but also prove to be more expensive, given your need. You can apply for a loan in easy steps, no matter where you are and when you want. You can start your application anytime. As online lenders are available 24/7, you can easily apply for a loan without worrying if the lender’s branch is open, or whether there is ample parking or not. 4. Economical The lender incorporates the costs associated with physical interactions, like site visits, branch infrastructure, and the loan interest rate. There are no additional costs during the online loan application process apart from those clearly stated on the lenders’ websites. Whereas, offline loans may require additional fees as agents may be paid commissions. Another significant cost benefit is that your credit score is not obtained for every lender mapping when you apply online. On the other hand, if you apply offline, each lender will check your credit score, which would increase your borrowing costs. 5. Ample options and Customisations When you apply for a loan online, you get a vast pool of moneylenders with numerous loan options. You can select from various options rather than be forced to take what has been offered. You map out the one that best suits your needs, and if everything goes well, you move on to the next step. An online loan essentially puts you, the borrower, in a position where you can match the business with the right lender. The ability to customize a business loan is another advantage. The borrower can customize the included elements of the loan, such as the loan amount, duration, interest rates, and so on, based on the ability to repay and the required capital. Customization ensures that the borrower does not run out of money and gives them the loan they need without making it expensive. 6. Direct transfer Usually, in the case of offline applications, it takes a long process to transfer funds to you, and it gets complex, but in the case of online loans, the amount is directly transferred to the bank account without any worries. A company does not have to shut down operations or growth plans while waiting for funds, as online business loans usually require minimal documentation and are disbursed quickly. Numerous online lenders that offer business loans will deposit your assets quickly after you are approved. You can get the money the same day you apply, in a few business days, or within 24 hours, depending on the lender you choose. 7. Lower interest rates Online business loans usually have lower interest rates than other types of loans due to the fierce competition among lenders for customers’ attention. Most business owners believe that a business loan comes with a high-interest rate, making it a burdensome financial commitment for them when they don’t know what their future sales and income will be. Online business loans with lower interest rates can reduce their financial obligations while obtaining sufficient funds for their organizations. [B-02] Conclusion You can overcome any financial obstacles with the help of an online business loan, which will also you with the financial support you need to upgrade your business plan. An online business loan is a good option for businesses that want quick and easy financing. Piramal Finance provides fast approval and a wide range of financing options. It offers various types of unsecured loan options that are highly beneficial, further helping you in choosing the one that best suits your requirements. You can apply for a loan from the comfort of your home or office thanks to the online process that saves you time and money. Contact Piramal Finance immediately to boost your business.

08-11-2023

Personal Loan

What is a pre-approved loan offer? A detailed guide

Choosing the home of your dreams requires patience and time. You would likely look at a few options before finalising one. Just like finding the house of your choice could take time, getting loan approval for the house also takes time. The lender will have to consider and assess various aspects before sanctioning a loan, which could take a while. So, what happens to the home you choose? There is a possibility that you may lose the opportunity to buy a home due to a delay in payment. This is where a pre-approved loan can help you. A pre-approved home loan, as the name suggests, is a loan that is approved before you finalise the property deal. The lender gives an in-principle approval for a loan based on your income, credit score, and financial position. The pre-approval process is the same as the regular loan approval process, except you don’t have to send in any documents about the property. [B-01] The essential features of a pre-approved loan are: A pre-approved home loan is essentially an in-principle approval based on your repayment capacity. The financial institution gives you a pre-approved loan offer after assessing your repayment capacity. The loan disbursal is based on you identifying a house within the given validity period. The property you choose for purchase should meet the legal and technical requirements of the lender. Even if you have a pre-approved loan, if the property is not as per the lender-accepted norms or does not have a clear title, they will not disburse the loan. The pre-approved loan is valid for a specific period, usually 3 months. Pre-approved loans are valid for a limited period, usually three months. To get the loan sanctioned, you must finalise the property within the given period. If you do not choose a property within three months, you can have your loan application reappraised; you will have to pay some costs and submit your latest income documents. The loan terms are finalised at the time of loan disbursement. The actual terms for your pre-approved loan are fixed upon loan disbursal. The offer may have indicative conditions; however, the interest rate may change from when you get the approval to the actual loan sanction. What are the benefits of a pre-approved loan? A pre-approved loan offers the following benefits: Your search for a home is now more focused. A glance at the listings for any property will tell you that you have a wide range to choose from, both in terms of property type and budget. You have a choice between apartments, independent homes, villas, gated communities, and standalone buildings, and the cost could be in the lakhs or crores. When you have a pre-approved loan, you know at least what price range to focus on. If you have a pre-approved loan for 80 lakhs, you know to look at properties around this range. Loan disbursal is quicker and simpler. When you have a pre-approved home loan, the lender completes a significant part of the loan verification process. The lender assesses your repayment capacity and also carries out the checks related to the KYC process. Once you have finalised the property, the lender will verify the property papers and perform due diligence on the property you have chosen. The sanction takes less time. If you have a small window in which you have to pay for your house, a pre-approved loan offers a lot of advantages. Better financial planning. When you apply for a home loan, you are unsure about your eligibility. The lender could reject your application, or you could get a loan sanctioned for a lower amount than what you expected. This could derail your plans to buy a house. A pre-approved loan helps you plan your finances better. You know how much you can borrow; this helps you estimate how much you would need as a down payment when you want to buy a house. You can plan your finances better, keeping in mind the approved loan amount, your savings, and the amount you wish to spend on purchasing a property. You can negotiate better. A pre-approved loan gives you an edge in your negotiations with the lender as well as the seller of the house. The lending institution has assessed your repayment capacity and creditworthiness and has found you fit to sanction a loan. This means you can get a loan from competitors at better terms, too. The lender will also view your application favourably and be willing to offer you a better deal. You get a loan at lower rates, plus you could get more favourable repayment terms with a pre-approved loan. With a pre-approved home loan, you can get a better deal from the seller. The seller is assured of your intent and capacity to buy. They are convinced that you will get a loan sanction quickly and thus be able to pay them faster. How to get a pre-approved home loan? You need to apply to the financial institution of your choice. You can do so online too. Piramal Finance also allows you to apply for a loan online. Along with your application, you will need to send proof of your identity, where you live, and how much money you make. The lender then verifies your repayment capacity based on the details and documents you submit. They also check your credit report to assess your creditworthiness. After the verification process, the financial institution will issue a loan approval letter that has the sanctioned loan amount and the applicable interest rate (the rate may change by the time of disbursal). Banks charge a non-refundable processing fee that is taken out of the loan amount if the borrower gets the money in the allotted time. [B-02] Conclusion Though a pre-approved home loan is not a guarantee of loan disbursal, it offers some advantages. A pre-approved loan can aid your property search and also help you get a loan at better terms. You get a better picture of your loan eligibility and can plan your finances better. So go ahead and get a loan approval if you plan to buy a house soon.

08-11-2023

Home

How do You Smartly Finance a Home Renovation?

You worked hard to save money and are looking forward to giving your house a new look after a long time. Using the funds properly becomes essential when you have a tight budget. Be confident about your other decisions by learning how to finance the home renovation. Renovating an existing property is easier. This is when you have proper insights into the requirements and sections you want to customise. Learning the steps to ensure you only spend within your budget and adequately utilise your funds becomes crucial. Let’s know more about how you can finance home renovation more effectively. [B-01] Stick to the process. Whether it is expansion, renovation, or repair, you must ensure the optimum utilisation of funds. You should ensure that restructuring your home makes your loved ones feel safe and secure. It becomes equally important to plan out the process, from the requirements to the costs you incur. Make a strict plan No matter how big your aspirations are, always plan according to the funds you have. Refrain from being tempted by attractive options and spend your money smartly. Observe your requirements Plan out what parts of your home need repair, renovation, or restructuring. Make a customised plan for your expenditure on those parts so that you don’t overspend on them unnecessarily. Opt for home renovation loans Home renovation loans are quite beneficial when it comes to financing home renovation options. Most banks, non-banking financial corporations, and housing finance companies also provide this facility through their standard home loan products or as a service within the general category of home loans. Choosing repayment methods After observing the renovation improve your home, you need to choose repayment options. You can either opt for EMIs for a fixed period, step-up instalments, or equated instalments to repay the home renovation loans. Benefits of home renovation loans Unlike personal loans, home renovation loans have more accessible repayment options. These leave your credit and financial status unaffected. Home improvement loans have various benefits, as follows: Eligibility – You can easily be eligible for a home renovation loan without income proof or tax documents. You can bring along a family member to improve your eligibility. Applicable to all – Homeowners applying for loans to finance home renovations could be anyone. From salaried individuals (like government employees) to self-employed persons (like business owners), renovation loans can be availed of by all. Usage – You can avail of home loans to either renovate your house or restructure or repair certain sections of your property without any questions. Quick financing – After applying for home renovation loans, lenders will review your application. Officials will visit your property. They will authorise the approval. After this, you will be given funds in less than 72 hours. Tax benefits – The EMI burden on home improvement loans is comparatively lesser than that of personal loans. Take advantage of a home improvement loan under Section 24 of the Income Tax Act of 1961. You must choose the best option among those offering competitive interest rates. Eligibility to avail of home improvement loans The primary eligibility criteria to avail of home renovation loans are as follows – Age limit – You must be over 18 years of age to avail of home improvement loans. Applicant’s status – You can be someone applying for the loan for the first time or an existing borrower looking for a loan to finance the home renovation. Credibility – Your CIBIL score should be around or above 750. It increases your chances of getting a secured loan at a lower interest rate. Improved eligibility – To increase your eligibility for getting a home renovation loan, get a family member along. Add them as co-borrowers. Documents needed The documents you need to produce to the lender are as follows: Application form, including all the personal details Age Proof – Marksheet, Aadhar Card, etc. Income Proof – ITR documents, etc. Proof of Employment – for salaried Individuals Proof of Business – for Self-Employed Individuals Proof of Address – Electricity Bill, Water Bill, Utility Bill, etc. Property Documents Estimated cost of repair Schemes to finance home renovation Opting for home improvement schemes comes with long repayment tenures at a reasonable interest rate and EMI options. The following schemes facilitate home renovation loan options that you can choose from – Bank of Baroda home improvement loans – This scheme offered by the Bank of Baroda is beneficial for individuals looking to finance home renovations. The loans can be used to repair, renovate, and restructure their properties. The residents of metro cities can avail of a loan of up to ₹5 crores (₹10 crores for residents of Mumbai). The interest rate starts at 6.85% with a repayment tenure of up to 30 years. TATA Capital home renovation loans – One can avail of a loan of up to ₹25 lakhs at 2% processing fees. This facility by TATA requires no collateral, has maximum eligibility, and easy repayment options through EMI and step-up repayment. The interest rates start at 10.99% annually with a repayment tenure of up to 6 years. HDFC Bank home improvement loans – This scheme offers an easy documentation process, easier loan approvals, and flexible EMI repayment options. Borrow up to Rs. 75 lakhs at a 7.55% annual interest rate and processing fees of 0.5% (for salaried individuals) and 1.5% (for self-employed individuals). The repayment tenure under this scheme is up to 15 years, with applicable taxes. Canara Bank home improvement loans – You can avail of a maximum loan amount of ₹2 lakhs under this scheme. The interest rates start at 6.9% annually with a repayment tenure of up to 5 years. The processing fee for this facility is 0.5% of the loan amount, plus applicable taxes. This scheme also has a smooth documentation process and easy loan approval. [B-02] Conclusion It is ideal to opt for a home improvement loan rather than a personal loan with the risk of an interest spike. There are various home loans; one of them is a home improvement loan. This pays for all of your home’s renovations and the money needed for repairs. Even these loan types are divided into additional groups based on the individual’s preferences. Through this article, you are now aware that you have the right to know the expenses, charges, and interest you must pay for your home renovation loan. Contact Piramal Finance and get in touch with our consulting experts if you want to know more about home loans and their benefits over personal loans.

08-11-2023