What security needs to be provided for a house loan?
Security for the loan is a first mortgage of the property to be financed, normally by way of deposit of title deeds (a clear and marketable title). Some lenders may also require collateral security like the assignment of life insurance policies, pledge of shares, national savings certificates, and units of mutual funds, bank deposits or other investments.

When can I apply for a house loan?
Once you have decided to acquire or construct a property, you can apply anytime thereafter, even if the property has not been selected or the construction has not commenced. Besides, loans are also available for home improvements, renovation or extension of your home.

How do I make an application?
You need to approach Housing Finance Company with the latest salary slips and TDS form 16 of the last two financial years of yourself and your co-applicant, if any. The loan officer will then tell you the loan amount you are eligible for and the terms of the same.

You need to submit the application form along with the necessary documents. On receipt of the application form, the HFC reviews it, asks questions wherever necessary and convey its decision to the applicant. You are advised to visit more than one company since you are likely to get better terms/ larger loan amount if you shop for the best deal.

What security do I have to provide?
Security for the loan is a first mortgage of the property to be financed, normally by way of deposit of title deeds and/or such other collateral security as may be necessary. Interim security may be required if the property is under construction. Collateral could be in the form of life insurance policies, the surrender value of which should be equal to the loan amount, guarantees from sound and reliable guarantors, pledge of shares and such other investments that are acceptable to the housing finance company.

What are the loan tenure options?
The tenure of the loan could range from one to seven years for new cars and from one to five years for used cars.

What are the lending rates?
The lending rates vary on the basis of discounts, which are offered by manufacturers and dealers.

How is the interest charged/calculated?
Interest is calculated on a monthly reducing balance basis.

How do I take personal loans?
Check out with different banks who are offering you the loan. Find out the eligibility criteria and the documents required to submit before you apply.

How soon will I get my personal loan money?
Usually banks promise to disburse your loan within seven working days. However to avoid further delay, it is recommended to keep all your documents ready, especially the post dated cheques (PDC).

Banks from where you provide your PDCs require at least a day or two’s notice to give you the cheques. The loan is disbursed only after the completion of all required documents are submitted.

What is the maximum tenure of a personal loan?
Personal loan is a short tenure loan. Most of the banks provide you loan for maximum 3 years (36 months). However there are options of 5 years (60 months) also.

How do I repay my personal loan?
At the time of applying for the loan, banks ask you to submit all the post dated cheques (PDC). The numbers of cheque leaves depend upon the tenure you opt. There is an option of prepayment after completing the lock-in-period of 6 months where you only have to pay the outstanding principal. However the option of part payment is not available.

How is my loan eligibility determined?
Loan eligibility depends upon various factors. The main factor is your ability to repay. The bank would like that the installment you pay should not exceed more than 30 to 40% of your net salary. Apart from that your profile in terms of residence and the place of your work also matter. You should be in the managerial cadre and residing in a location approved by the bank. Sometimes if you reside in a chawl or at places termed negative by the bank, your loan approval becomes very difficult.

What is relationship discount?
Lenders offer relationship discounts if you already have a relationship with them. This means that if you are already banking with the lender from whom you want to avail a loan then they give you certain discounts in the form of reduction in interest rates or other charges.

They may even give you a free credit card with fees waived for the first year. Sometimes they even give you additional services.

What kinds of educational loans are available?
These loans are provided for studies in or outside India. These loans are available for under graduate as well as postgraduate courses generally in professional, technical and vocational fields. Let’s give you a list of the courses available for which loan will be available:

Under graduate courses like schooling.
Certificate, Graduate courses and Design courses.
Post graduate courses in engineering, medical, management and others.
Diploma courses in engineering.

Every lender has its own approved list of courses and institutions for which it provides loans like Management courses from IIM’s. There are certain computer courses for which you could get a loan. These institutes have a tie ups with the bank like NIIT has a tie up with Citibank for which loans are available to fund the course.

What are the interest rates applicable on education loan?
The interest rates vary from bank to bank depending upon the loan amount. In case of secured loans, i.e. against collaterals, the rates are generally in the range of 12-15% and in case of unsecured personal loans, 16-24%. The banks charge simple interest from the date of disbursement to repayment. After commencement of repayment, interest is compounded on the reducing balance methods.

What kind of security and document are needed for this loan?
Security for Educational loans depends on the loan amount and the repayment capacity of the borrower. Lenders generally ask for:

Third party guarantee.
Collateral security in form of LIC policy to property for the Value of the loan to be obtained. Some banks even ask collateral security for amount higher than the loan amount.

The various documents required are:

Application Form
Admission note
Copy of passport/Visa of the student
Residential Proof
Income Proof of parents or guardians like IT Returns, Salary Slip, Bank Statements for last 6 months
Proof of Age
Proof of business
Length of business/employment
Academic record of the student
Details about the student’s course schedule
Collateral security documents like share, insurance, property papers
Signature verification

How much money can I borrow?
The amount of allowable money borrowed is contingent on many factors. The strength of credit history, previous credit limits, income, residence status, business gross sales, and your time in business are some of the major factors that contribute to acquiring a commercial loan.

What qualifies as a business loan?
A business loan requires a minimum of 24 months in business with an average of gross sales of $150,000 or higher. Business credit does play a role, but the overall credit of all owners is the deciding factor.

Do I need to be currently employed to get a business loan?
Though current income is one of the factors contributing to getting approved, some lenders will not require you to be currently employed. Some lenders will dedicate their focus more upon the business a person is looking to start or buy.