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Old 21st August 2013, 15:16   #346
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Default re: Help with a home loan!

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Originally Posted by ghodlur View Post
Mortgage deed needs to be registered for sure but need not be done at the sub registrar. If this proces is changed, I am not aware.
Yes. The process is changed since 1st April 2013.

The new Process is SRO Intimation (Deposit of Title Deed Registration). I just did this registration yesterday at Borivali - 6 Sub-Registrar's Office.

Since you have deposited your Title Deed (on Flat) with Bank, you are supposed to get this Agreement (between you & the bank) with the Registrar's office.

You need to pay 0.2% of the Loan Amount as Franking Charges + Rs. 1,000 DD & Rs. 300 in Cash.

Document: explenatory note on Equi motgage[1].pdf

It feels strange in this country, we are taking home loans as we do not haev money, now to get the Mortagage Agreement registered, we have to pay additional 0.20% (of loan amount) + Rs. 1,300.

Thanks,
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Old 27th September 2013, 22:51   #347
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Default RBI diktat on migration of PDC/EMI cheques applicable to HFC's ?

The RBI in their infinite wisdom has issued a circular bearing ref no RBI/2013-14/158 DPSS.CO.CHD.No. / 209 / 04.07.05 / 2013-14 dated 24th July, 2013 which states that all lending banks have been advised not to accept any fresh Post Dated Cheques (PDC)/Equated Monthly Installment (EMI) cheques in locations where the facility of ECS/RECS (Debit) is available and to convert existing cheques in such locations into ECS/RECS (Debit) by obtaining fresh mandates.

The said circular is addressed to the CMD/CEO of All Scheduled Commercial Banks including RRBs / Urban Co-operative Banks / State Co-operative Banks / District Central Co-operative Banks/Local Area Banks.

What this essentially means is that banks can no longer accept PDC's for any loans given by their branches provided ECS facility is available at the said branch.

My question is whether this circular is applicable to housing finance companies like HDFC Ltd / LIC housing Finance Ltd etc. i.e. if I have taken a home loan from a housing finance company (and not from a bank), can the HFC force me to shift to ECS mode of repayment based on this circular. Would be greatful if any forum member who is employed by a bank or better still the RBI itself is able to answer my query.

The link to the said circular from RBI is reproduced below :-

http://www.rbi.org.in/scripts/Notifi...Id=8267&Mode=0

Last edited by longhorn : 27th September 2013 at 23:13. Reason: link added
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Old 28th September 2013, 12:04   #348
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Default Re: RBI diktat on migration of PDC/EMI cheques applicable to HFC's ?

This is more of a directive than a compulsory action. Lenders will also be guided by what their customers are ok with because for them closing the deal is more important than getting it on ECS/PDC all though the former is substantially cheaper to administer and the way to go for a borrower also. Its advisable for the borrower as well to give a ECS instruction rather than give a whole bunch of cheques ( which can be prone to fraud/misuse/loss etc ).

While the specific circular may not be addressed to HFCs, I am sure HFCs might be happy to onboard their customers on ECS and maybe even give an incentive to do so
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Old 28th September 2013, 13:57   #349
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Default Re: RBI diktat on migration of PDC/EMI cheques applicable to HFC's ?

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Originally Posted by narayan View Post
This is more of a directive than a compulsory action.
This is the essence of my query. Though after reading through the circular I felt it is compulsory and not optional. The issue is my home loan is from HDFC Ltd and I dropped PDC's at their cheque drop box. They usually collect cheques for a year and when 10/11 installments are through, you drop another set for the next year. This was the practice until now.

When I dropped a set of cheques last week, I was intimated from the branch over phone that as per RBI directive, they are not supposed to collect PDC's anymore, and they couriered me back the cheques.

My understanding is that HDFC Ltd being a housing finance company and not a bank, this circular is not applicable to them. Of course they can request customers to convert to ECS, provided the customer is willing, but do they have the right to compel you to go ECS?

I have asked the lady who called me to give the same in writing, which I don't think will happen. What options do I have if I want to continue to issue cheques and not go for ECS.

EDIT : I believe they are trying to push customers to ECS to lower their administrative costs, and they are hiding behind the RBI circular towards this end. This is precisely why I continue to issue cheques to them. I don't want to help lower their admin costss because they are not passing any of this benefit to the customer inspite of NHB circular which clearly asks to incentivise customers to go for this.

When HDFC Ltd lacks business ethics, because inspite of going for floating loan, new customers always get better rates than existing ones, your credit rating or repayment track record notwithstanding, I don't want to do anything that would add even 1 extra paise to their kitty. They may be legally right, but morally they are wrong.

Last edited by longhorn : 28th September 2013 at 14:06.
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Old 28th September 2013, 15:36   #350
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Default Re: RBI diktat on migration of PDC/EMI cheques applicable to HFC's ?

Quote:
Originally Posted by longhorn View Post
My question is whether this circular is applicable to housing finance companies like HDFC Ltd / LIC housing Finance Ltd etc. i.e. if I have taken a home loan from a housing finance company (and not from a bank), can the HFC force me to shift to ECS mode of repayment based on this circular. Would be greatful if any forum member who is employed by a bank or better still the RBI itself is able to answer my query.
Yes. The rule is applicable to all type of cheque payments - loan or otherwise.

Reason is pretty simple = TECHNOLOGY

Which is, CTS (= Cheque Truncation System).

Physical movements of the cheques will be discontinued and only the image of the cheque moves between the Banks!. So the cheques need to be standardised (CTS 2010 standards).

RBI has allowed a window for the non-CTS cheques to be presented through clearing. It may be withdrawn or there could a charge for processing the cheques.

Quote:
Originally Posted by longhorn View Post
This is the essence of my query. Though after reading through the circular I felt it is compulsory and not optional.
You are right!


When I dropped a set of cheques last week, I was intimated from the branch over phone that as per RBI directive, they are not supposed to collect PDC's anymore, and they couriered me back the cheques.
Why would they stop collecting PDCs? Probably your cheques were not CTS-2010 standards.


My understanding is that HDFC Ltd being a housing finance company and not a bank, this circular is not applicable to them. Of course they can request customers to convert to ECS, provided the customer is willing, but do they have the right to compel you to go ECS?
No


I have asked the lady who called me to give the same in writing, which I don't think will happen. What options do I have if I want to continue to issue cheques and not go for ECS.
Ask HDFC to suggest alternatives. Check whether EMI payment is allowed through your credit / debit card.


I believe they are trying to push customers to ECS to lower their administrative costs, and they are hiding behind the RBI circular towards this end.
Yes! Welcome to the electronic banking world!


I don't want to help lower their admin costss because they are not passing any of this benefit to the customer inspite of NHB circular which clearly asks to incentivise customers to go for this.
I haven't heard of any Bank trying to reward honest loan re-payers!


When HDFC Ltd lacks business ethics, because inspite of going for floating loan, new customers always get better rates than existing ones, your credit rating or repayment track record notwithstanding
The name of the game is PROFIT.
PS - Did anyone read yesterday's Economic Times Editorial? They have lambasted RBI for trying to bring in transparency
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Old 28th September 2013, 17:09   #351
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Default Re: RBI diktat on migration of PDC/EMI cheques applicable to HFC's ?

Quote:
Originally Posted by vrprabhu View Post
Yes. The rule is applicable to all type of cheque payments - loan or otherwise.
The point I wanted to make is that the RBI circular is addressed only to banks and not to NBFC's. Let me quote the most relevant portion of the circular here. "... wherein all lending banks have been advised not to accept any fresh Post Dated Cheques (PDC)/Equated Monthly Installment (EMI) cheques in locations where the facility of ECS/RECS (Debit) is available..."

I am not issuing PDC to any bank. I am issuing PDC's to a housing finance company. The HFC will present the cheque month on month to the bank. So obviously there is no question of any bank accepting PDC's since the cheques will be presented by the HFC on the due date. But if you have taken a home loan or any loan for that matter from a bank, you will have to go the ECS route once existing PDC's are exhausted.

Quote:
Originally Posted by vrprabhu View Post
Why would they stop collecting PDCs? Probably your cheques were not CTS-2010 standards.
The cheques I had issued were those of HDFC bank and they are very much CTS 2010 compliant.

Quote:
Originally Posted by vrprabhu View Post
Ask HDFC to suggest alternatives. Check whether EMI payment is allowed through your credit / debit card.
I don't want to go electronic because if I do, they will get a significant cost reduction even a fraction of which they won't pass back to the customer. I am indirectly linked to the financial services industry and let me tell you, handling these cheques is no joke. They need to have vaults to store them and then they need to retrieve the cheques in a timely manner and present the same to the bank. Its a logistical nightmare. They save huge when you go electronic because the ECS mandate is with the bank (and not the HFC). The bank is responsible to fire the ECS on time and transfer the funds.

P.S. My fight is only against HDFC Ltd and not against RBI's policy. In fact I whole heartedly welcome RBI's move. In fact I had taken the ECS route on another loan which is now closed.

Last edited by longhorn : 28th September 2013 at 17:34. Reason: spell check
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Old 30th September 2013, 10:21   #352
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Default Re: RBI diktat on migration of PDC/EMI cheques applicable to HFC's ?

Quote:
Originally Posted by longhorn View Post
I am not issuing PDC to any bank. I am issuing PDC's to a housing finance company.

But
if you have taken a home loan or any loan for that matter from a bank, you will have to go the ECS route once existing PDC's are exhausted.
The devil is in the detail, I guess.....

I got your point, and I hope you are able to get a favourable outcome!
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Old 30th September 2013, 11:55   #353
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Default re: Help with a home loan!

Hi Guys

Probably a dumb question. But can anyone clarify how much loan can one avail based on the net take home per month ?

For e.g., if my takehome is 10000 INR, how much home loan will the banks sanction ? Is it 6K or 5K ?

Appreciate your inputs
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Old 30th September 2013, 12:57   #354
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Default re: Help with a home loan!

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Originally Posted by lambuhere1 View Post
For e.g., if my takehome is 10000 INR, how much home loan will the banks sanction ?
Varies from bank to bank and depends on other criteria as well (E.g. other loans, number of dependents, average motnhly expenses as per account statement etc etc).

Based on 10k INR, loan amount can be "up to" ~5 lakh.

http://www.bankofbaroda.com/pfs/homeloans_more.asp
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Old 7th October 2013, 12:52   #355
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Default re: Help with a home loan!

Can you let me know how much can we withdraw from EPF account for purchase of a flat in Bangalore ?

For e.g., lets say my Basic + DA is 25000 pm, how much can we withdraw from EPF account if the account is held more than 5 years ?

How long does it take to process the withdrawal request ? Any experiences across members to share ?

Appreciate your help
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Old 11th October 2013, 18:31   #356
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Default re: Help with a home loan!

Team,

What are the charges involved in HOME LOAN ?

Processing Fees - Charged by the Bank
Legal Fees - Charged by the bank
Franking Charges - 0.2 % of the LOAN AMOUNT - Looting customers

Initmation Notice to Registrar Office - Rs 1500

Is there any thing else ?

Last edited by F150 : 11th October 2013 at 18:53.
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Old 11th October 2013, 18:57   #357
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Default re: Help with a home loan!

Quote:
Originally Posted by lambuhere1 View Post
Can you let me know how much can we withdraw from EPF account for purchase of a flat in Bangalore ?

For e.g., lets say my Basic + DA is 25000 pm, how much can we withdraw from EPF account if the account is held more than 5 years ?

How long does it take to process the withdrawal request ? Any experiences across members to share ?

Appreciate your help

I believe you have to be invested for 10+ years for partial withdrawal. Check the EPO website and everything is mentioned, including the eligibility.

http://www.epfindia.gov.in/
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Old 12th October 2013, 09:38   #358
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Default re: Help with a home loan!

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Originally Posted by F150 View Post
Team,

Franking Charges - 0.2 % of the LOAN AMOUNT - Looting customers

Is there any thing else ?
Do you mean stamp duty? The mortgage document has to be stamped, and the stamp duty is prescribed by the State Government.

In case you are buying a pre-owned flat, there will be charges for valuation / assessment.

In some cases there are inspection / site visit charges also....

Some banks throw in fee waiver (festive season offer etc.) and negotiate on case to case basis.
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Old 12th October 2013, 10:49   #359
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Originally Posted by vrprabhu View Post

Do you mean stamp duty? The mortgage document has to be stamped, and the stamp duty is prescribed by the State Government.
.
Yes, stamp duty for the mortgage/loan agreement between the borrower and the bank
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Old 28th October 2013, 16:58   #360
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Default re: Help with a home loan!

Was discussion about the home loan with friends, and during the recession times, its a very hard decision to make.

Looking at the scenerio, if we loose our jobs and are not able to pay the EMI's, are there any insurance products that take of payment of the EMI on account of loss of job ?

Was wondering if anyone is aware of any product like this ? Understand that the premium might be high, not sure though!
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