Posts Tagged ‘Personal Finance’
Home EMI Default,Taking Corrective Action
Buying a Home through Home Loans is the norm of the Day.
Days are past when being a Debtor was considered a Sin and attracted social ostracism.
Now if you do not have a Credit card or Loan EMI, you do not belong to the uppity group.
Now that you have availed of Home Loan, it is prudent to know what action to take in case of unforeseen default.
EMI Default Points, Home Loans.
1.Temporary problem in Repayment of EMI.
This might arise due to unexpected loss of job or expenses incurred in the Family due to Death, Illnesses.
In these cases represent the cases to the Lender the details in writing and request them for a minimum break from payment of EMI.
This may not be possible,
However ,depending on your credit rating, the managers may use their discretion in granting you relief.
This also may not be enough.
Make sure , if this request is granted, to stick to accepted schedule of payment.
You may also request them for a reduced EMIs at longer period of repayment.
This may be considered favorably ;this depends on your credit rating, qualifications company you work for or the number of years you have served in a company.
2.Permanent Failure to pay EMI.
You have no other option but to ask the Creditor to realize the mortgage and debit your account the balance if any.
Handling Collection Agents.
Inform th Collection Agent the position and confirm the details in writing to the Creditor.
Do not use abusive language.
In case the Collection Agents behave rudely including use of abusive language, report to the Link provided here below.
RBI is very clear on this.
“Lenders are willing to negotiate
Attaching a property is the last thing a lender wants to do. Though banks have the power to enforce the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, (SARFAESI) to recover non-performing assets without the intervention of a court of law, this is the last step they prefer to take. A bank usually lets one mortgage payment default slip by, but for the next one, it will mail you a reminder to inform you that your payments are late. After three defaults, the bank will send a demand notice, asking you to pay your dues as soon as possible.
“If the borrower doesn’t respond to any of the mails, the bank sends a legal notice through its legal department,” says VN Kulkarni, chief counsellor at Abhay Credit Counselling Centre, which is sponsored by the Bank of India. A bank waits for three months before declaring an asset a non-performing one. “After the end of this period, the bank can officially term thehome loan an NPA and start the process of recovering the property through the SARFAESI Act,” says Kulkarni. Even after invoking the Act, the bank gives the borrower a 2-month notice period to repay the dues.
“Finally, five months after the first default, the bank sends a notice, stating that it has valued the property for a certain sum and that it will auction the house on a particular date. This is usually set for a month from the date that the bank mails you the auction notice,” adds Kulkarni.
On Collection Agents.
http://www.rbi.org.in/Scripts/BS_CircularIndexDisplay.aspx?Id=4141
3. The bank would respect privacy of its borrowers.
4. The bank is committed to ensure that all written and verbal communication with its
borrowers will be in simple business language and bank will adopt civil manners
for interaction with borrowers.
5. Normally the bank’s representatives will contact the borrower between 0700 hrs
and 1900 hrs, unless the special circumstance of his/her business or occupation
requires the bank to contact at a different time.
6. Borrower’s requests to avoid calls at a particular time or at a particular place
would be honoured as far as possible.
7. The bank will document the efforts made for the recovery of dues and the copies
of communication sent to customers, if any, will be kept on record.
8. Inappropriate occasions such as bereavement in the family or such other
calamitous occasions will be avoided for making calls/visits to collect dues.
3. Giving notice to borrowers
While written communications, telephonic reminders or visits by the bank’s
representatives to the borrowers place or residence will be used as loan follow up
measures, the bank will not initiate any legal or other recovery measures including
repossession of the security without giving due notice in writing. Any genuine
difficulties expressed/disputes raised by the customer will be considered by the banks
before initiating recovery measures. Bank will follow all such procedures as required
under law for recovery/repossession of security.
Still you have problems report to Consumer Forums.
Plese read my blog posts filed under consumer forum.
Don’t Let Credit Card Do This to You
A Man aged 57 set himself ablaze after having accumulated more than £150,000.
A grandfather set fire to himself at home after amassing hidden debts of more than £150,000 and keeping them hidden from his wife of three decades, an inquest heard yesterday.
Ibrahim Omar, 57, of Bolton, Greater Manchester, put family photos and other personal items in his daughter’s car and left the car keys outside his house before setting himself alight indoors.
The former petrol station cashier suffered ‘95 to 97 per cent full thickness burning and charring’ to his whole body and was declared dead at the scene, the inquest at Bolton Coroner’s Court heard.
While using a Credit Card you do not actually have the feel of the money slipping from your hand and this has a psychological effect of not being acutely aware of spending.
Judicious use of Credit card requires a skill and a strong will.
I have seen my daughter and Daughter in Law doing it without paying interest whatsoever at the same time earning points to buy some thing free!
Do away with Credit Cards.
Emergency response: Ibrahim Omar’s body was discovered by firefighters in the front bedroom of his semi-detatched house in August and a post-mortem test revealed that he had been alive when the fire started
Mr Omar was suffering from depression and had told his GP that he had trouble sleeping due to his anxiety over money – but Mr Omar’s family were unaware of the extent of his illness.
‘He was a much-loved father and grandfather and will be sadly missed’
Ibrahim Omar’s son, Imran
His son, Imran Omar, said: ‘It has been a massive shock to the family and the community. He was a very popular, happy and enthusiastic man. He was a much-loved father and grandfather and will be sadly missed.’
Deputy coroner Alan Walsh recorded a verdict that Mr Omar took his own life while suffering from depression. He said his debts were made for the family’s benefit but had escalated out of control.
ATM Safety Tips
Get rid of ‘dangers’ during ATM transactions…
ATM
8 Golden Rules to keep your ATM transactions safe and secure
- Keep your ATM-cum-DEBIT card in a secure place
- Cover keypad when entering PIN.
- Change your PIN first time and regularly thereafter
- If you lose your card, block it immediately
- Do not handover your ATM-cum-DEBIT card to any person
- Do not keep any record of your PIN – memorise it instead
- Do not ask for help from strangers
- Do not leave ATM till your transaction is complete.
Source.SBI.
Facebook and High Credit Card Debt
Interesting study.
I am not sure how accurate this is.
Story:
Does using Facebook cause you to spend money you don’t have and to pig out on junk food?
As far-fetched as that might sound, a pair of U.S. marketing professors say they have found a relationship between time spent on Facebook and lower credit scores, higher credit card debt and bigger waistlines. The authors say their work is the first study of its kind to link Facebook to personal financial habits.
The research is among a growing number of studies that are seeking to explain how the use of Facebook and other new technologies is shaping our lives, for better and worse, in areas as diverse as social and civic interactions, commerce and psychological well-being. This month, Facebook said it surpassed 1 billion active users worldwide. About half of U.S. adults say they use at least one social networking site — twice that of just four years ago.
The researchers, Keith Wilcox of Columbia Business School and Andrew Stephen of the University of Pittsburgh’s business school, are not suggesting that people log onto Facebook and then, zombie-like, gorge themselves on debt and Twinkies. Instead, they say, the effects are subtle and cumulative.
The effects are most pronounced, they say, on Facebook users who have strong ties to their online friends. They say the process works like this: People browse through their social network of close friends. Participating in that supportive online community boosts their self-esteem. That brief increase in self-esteem reduces self-control.
ack:
http://www.creditcards.com/credit-card-news/facebook-more-debt-lower-credit-1276.php?a_aid=9fc4cb60
Borrow Money Intelligently,Manage Your Personal Finance Video
I have come across interesting Talks,Sites and Bogs on the subject of Borrowing Money.
There used to be a time when borrowing was considered to be a sin and it was treated as a Crime to delay payment.
Now, thanks to changing value systems and the Modern economy, if you do not borrow, you are not recognised and we are now used to a Lifestyle of wanting more than what we earn and in some cases what we deserve.
No point in suggesting people the safest and carefree Life is Not to Borrow.
Since there are no takers, the next option is to find out How To Borrow Intelligently.
Read On:
- ‘As any smart borrower could tell you, it’s important to read the fine print when it comes to lenders. Sure, that balance transfer may sound appealing now, but what happens in 6 months when the interest rates sky rocket? Credit card companies are notorious for hiding their little tricks in the fine print so pull at the magnifying glass if necessary.
- Even if you choose to consolidate debt and borrow more, always make more than the minimum required payments. By consolidating your debt, you may be eligible for lower monthly payments, but they won’t help you get your debt paid off any faster. Smart borrowers even go so far as to pay off their entire balance each month.
- Do you only have one or two credit cards? Do yourself a favor and keep it that way. Trying to juggle too many lines of credit is the opposite of smart borrowing. It’s simply too difficult to keep track of a dozen different credit cards, with their different due dates and minimum monthly payments. It’s almost inevitable that those who have too many credit options end up putting themselves in debt.
- If you’re planning on taking out a new credit card or any type of line of credit, do your homework to find the best possible interest rate. By now, everyone should know how important their interest rates are. In essence, they represent the cost of borrowing money and if you get stuck with a high rate, you’ll end up paying a lot more over time.
- No matter how much debt you’ve accumulated or how much you still need to borrow, saving money is always important. While repaying borrowed money is probably your number one priority, do not neglect your savings. You just never know when something could happen, such as a car accident or hospital visit, that could require you to break out the savings.
- Finally, don’t fall for the idea that declaring bankruptcy will be an easy fix to your debt problems. While bankruptcy may be able to help some people in the right situation, it can be a disaster for many. Declaring bankruptcy will absolutely ruin your credit score for the next several years and making borrowing more money all but impossible.’
- http://www.borrowingsdebt.com/how-to-borrow-intelligently.php
Tips to Save Money:
- Treat every purchase like it’s a major purchase. You have a few opportunities in life to save a lot of money, but it’s the small daily ones that will make or break you.
- Vacation close to home so you can drive instead of fly.
- Delay big purchases as long as possible. You may lose interest or find an alternate solution.
- Hang dry your laundry, indoors if necessary.
- Choose a hairstyle that does not require frequent trims.
- Repair instead of replace. This goes for appliances, furniture, clothing, whatever.
- Borrow infrequently used tools and supplies instead of buying. (Also make sure to lend.)
- Bank at a credit union instead of a corporate bank. You’ll most likely save on fees.
- Wear the clothes you already own instead of buying new stuff all the time.
- Cook from scratch and save restaurant meals for special occasions.
- Make sure you have a few easy meals on hand for those nights when takeout dinner is calling your name. There’s nothing wrong with serving scrambled eggs and toast for dinner.
- Use your library for books, magazines, movies and CD‘s. And then make sure to return them on time!
- Foster your relationships with like minded friends. They won’t make you feel bad about sticking to a budget.
- Pack your own work and school lunches.
- Replace expensive recipe ingredients with inexpensive options. Perfect example? Kale instead of basil in pesto.
- Don’t be a snob about older electronics. You will survive without the newest iPhone.
- Learn how to mend and de-stain your clothing. If half your wardrobe is out of commission, you’re missing out.
- Batch your errands whenever you drive.
- Drink water or homemade iced tea instead of soda.
- Choose social get togethers that do not include shopping.
- Cancel memberships that you do not use. Gyms, premium cable channels, and everything else.
- Pay attention to your household’s food waste. Eat what you have, and stop buying the food that you tend to waste.
- Be willing to own less stuff. There’s less to buy, organize, clean and look at.
- Wait until movies hit the second run theaters.
- Decline your friends’ shopping parties. You don’t need any more Tupperware, baskets, jewelry or candles.
For more follow the Link:
http://www.huffingtonpost.com/katy-wolkstanley/budgeting-saving-money-ideas_b_1770454.html
