Showing posts with label interest. Show all posts
Showing posts with label interest. Show all posts

Thursday, May 28, 2020

Women should know about low pay duty charges and interest in real estate

Women in cities have become an important focal point for developers. Unlike the earlier scenario where they were not just considered decision makers and producers, Indian women today are much empowered and have become independent decision makers in home buying matters. Along with good jobs with fantastic growth prospects - not only in corporate India, but also in government positions in rank, women today are an important target audience for major property developers.

Today a growing number of women believe that owning physical assets like home makes them realize more than marriage at the right age.

The scenario has also changed for married women. With dual-income families as background, many women are now active financial partners with equal say in purchasing decisions.

Shortly before this there was a distinct change in family dynamics and their investment priorities, which were mainly gold and Fixed Deposits. Real estate now occupies an important position in their investment portfolio.

The government and the banking system are also going the extra mile to encourage women into standalone homework. In India, stamp duty fees for property registration are lower in some states if it is executed in the name of a woman. Delhi, UP, Rajasthan, Punjab and Haryana are with stamp duty exemption for women buyers. The exemption on stamp duty is up to 1-2% in different states.

“If the property is jointly owned, there may be additional tax benefit. Like men, women home buyers are also eligible for tax exemption up to Rs 1.5 lakh under Section 80C of the Income Tax Act on principal paid on housing loans, and home loans up to Rs 2 lakh under Section 24 per annum on interest. If a property is let out on rent, full interest is allowed on the home loan as a deduction. However, to avail this additional tax benefit on home loans, the property has to be co-owned,” according to experts.

In addition, many large banks in India pay less home loan interest to women borrowers than men. The discount may vary from 0.05% to 0.25% depending on the bank and loan amount.

Thus, women across urban India are buying properties to diversify their investment portfolios or to have multiple benefits for women, ranging from tax benefits to lower home loan interest rates by some banks and in various states Stamp fees and registration fees are also reduced.

Monday, May 25, 2020

RBI extends EMI moratorium - latest update

As India struggles to get back on its feet in the rest of the world, the Reserve Bank of India is exploring ways to make the life of the common man less stressful.

The first EMI moratorium was announced on 27 March 2020 and was to cover debt repayment between March 1 and May 31. As the COVID-19 pandemic still continues, it was clear that postponement expansion was needed. That is why today (22 May 2020), RBI Governor Shaktikanta Das extended the moratorium on loan repayment saying - “In view of the expansion and continued disruption of lockdown due to COVID-19, the decision to allow lending institutions has been taken. From June 1 to August 31, 2020, another three months to extend the moratorium on term loan installments.

How does an extended EMI moratorium help?


About 122 million people lost their jobs due to the outbreak of COVID-19. To add to this, self-employed individuals are struggling to make ends meet due to loss of income during the epidemic. If you are wondering, about 51% of India's workforce is self-employed! This means that a large part of India's working population is now finding it difficult to manage its expenses and pay back its debts.

The additional 3-month extension would provide some much-needed relief to these individuals. They will now be able to take out their loans such as car loans, home loans etc. If they miss an EMI payment then they run the risk of negatively affecting their credit score.

Now that the loan is deferred for 3 months, and money is not deducted from their bank accounts, most people will have little money to watch them until things start appearing.

Important points to keep in mind about EMI moratorium


Although the RBI EMI moratorium is good news for many people, what should you know here-

· The EMI moratorium is not a mandate, it is a competent provision. Banks have the right to decide whether they want to follow it or not. Individual banks will also be allowed to decide whether this moratorium will be extended to all borrowers.

· If you have decided to avail the moratorium, the EMI will be extended with interest applicable to your outstanding principal amount during the unpaid time. This will increase your overall interest cost. If you have the money to manage your loan EMI, it is best to stick to the original repayment schedule, especially if you have a notable outstanding loan amount for a loan against a home loan or property.

· The moratorium prevents payments for principal and / or interest components; Bullet repayment; Equal Monthly Installments (EMIs) and credit card dues.

Repo rate reduction


Apart from announcing the moratorium, RBI also announced a drastic reduction of 40 basis points in the repo rate to 4%. The reverse repo rate has also been reduced by 40 basis points to 3.35%.

Repo rate is the interest rate that RBI charges for the funds to be given to banks. This drastic reduction in repo rates will also reduce the lending rates to banks. Lower lending rates will give people hope to think about reinvesting. It is also said that EMI will come down on home, auto, personal and term loan rates in the near future.

Saturday, May 9, 2020

Report suggests that RERAs extends the project deadline by 6–12 months

In a recent report by the PHD Chamber of Commerce, findings from various real estate bodies have suggested that the Center advise all the states to extend the deadline for Real Estate Regulatory Authorities (RERA) to complete projects ranging from six months to 1 year. Should be given just 3 months in the wake of the COVID-19 crisis and the ensuing nationwide lockdown.

The industry body has also proposed that a six-month suspension period be allocated for payment of local body taxes such as municipal taxes and property taxes.

It further suggested that current projects are considered assets to be loaned to developers.

The report states: “Stamp duty and registration fees should be reduced or waived on flats completed for a period of about one year. This will not only be a major challenge for the real estate sector, but it will also boost demand in key industries like cement, steel, electrical etc., while at the same time providing employment opportunities. This can go a long way in rejuvenating economic activities. "

It acknowledged that although the RBI's cut in the emergency rate would reduce interest rates, consumer sentiment should be further stimulated to buy a home.

According to the report of the Board of Industries, "It is suggested that the deduction in interest for home purchases should be reduced this year. For example, for the current year, the deduction of interest may be paid 200 percent of the interest. , Followed by deduction of 175 percent interest paid for the second year, 150 percent deduction of interest paid for the third year and so on. "

It has been suggested that the industry would be helped, such as during the COVID-19 crisis, that the minimum wages of construction workers would be borne by the government using labor funds collected by the developers.

The report also touched on a long-awaited request for industry status for the real estate sector.