I don't understand what the author is talking about here on advicing people to sell their house. There are people who take loans to buy house from the investment perspective. This option may be viable for them. But for people who have it as their only home, your advice to sell and settle them loan if they are not able to handle rising EMIs beyond the short-term calculations whatever you have said. If they sell their only home, where should they live??? In a rented house??? Even if they sell the house and settle the loan, if they happen to be in an expensive place like Bangalore, they have to cough up 10 months rent as advance for a rented house. where are they going to get that from??? another loan???
So when you are writing articles, please be specific on each possible scernaros and then advice. Do not generally assume that everyone would have bought houses taking loans only from the tax saving and/or investment prespective. For a lot of them, its a sense of having their own roof on their head...
RE:Sell the house??
by rakhi sawoneant on Apr 09, 2007 12:32 PM Permalink
the writer just suggested. it could be right for some individuals like in the example given, if one of them loses his/her job what do they do. sell the high cost house and shift to a lower cost house. its like cutting your credit card bill with a personal loan which is less expensive.
RE:[object MouseEvent]
by Smart Fool on Apr 09, 2007 12:46 PM Permalink
I understand that the author is trying to suggest that this may be good for some and not so for the others. All I said was that the author has to be explicit in giving suggestions that this may be good if... with specific examples...
RE:Sell the house??
by abhijit rao on Apr 09, 2007 12:26 PM Permalink
Hi, I agree ... The steep rise in interest rates is just ILLOGICAL. The government doesnt realise that neither the average life span / years to retirement can increase as illogically as that of the interest rates and nor does salary. I request rediff to engage an advocate who can answer and guide us to reach the Law. Regards, Abhijit
RE:Sell the house??
by ItsMe on Apr 09, 2007 12:19 PM Permalink
it is clear if you cannot pay the EMI, you have a choice, you sell the house or the bank sells the house. the author has given options, reduce your expenses and pay EMI or sell...
RE:Sell the house??
by Smart Fool on Apr 09, 2007 12:33 PM Permalink
If the bank hikes the interests which makes it impossible for the borrower to pay the EMIs, the bank has the right to sell the house. I am sure that bank will sell the house and clear their debts, but what about the family which lives in that house? will the bank take resposibility of them? No definitely not, the family will be left on the road to face their fate. Say if the house is worth 25 lakhs, the bank will sell the house to recover their debts and I think they will auction the house. Say the house is sold at 32 lakhs because of the appreciation for the land value on which the house is built. Will the bank give the extra 7 lakhs after recovering the debt to the borrower????
RE:Market will crash
by anil b on Apr 09, 2007 01:56 PM Permalink
That is long overdue but there will be lots of people who will suffer especially those who have payed huge insane prices for properties without looking at the actual intrinsic value .the benificiaries are reality developers(all mafia characters) and the government buerecrats(controll mafia )
You have written the article on the upper middle class. What about the lower middle class? did any one give a thought? after paying the loan and at the end of the month we have zero balance in bank account. We took the home loan four years back of Rs. 3,32,000/- after paying the loan for so many years, I still have to pay 3,16,000/- and the EMI raised from 3150/- to 3560/-. No doubt the crime rate is raising....Hail the government....and the politicians...we are homeless yet again..
is this possible to form a loan consumer club & file a PIL against rising loan interest rates in Apex body, as this is resulting a total imbalnce for the middle class family & there dreams, Total tense life....., Please share your thought....
RE:EMI
by Full2Njoy on Apr 09, 2007 12:20 PM Permalink
Nope u cant. its simple market economics at play. you cant blame a bank for increasing interest rates when RBI raises it. No bank is sitting to do charity.
The only solution is to go to another bank. Simple. Live within your means is the mantra of the day. Take a house loan within your repaying means.
RE:EMI
by ItsMe on Apr 09, 2007 12:22 PM Permalink
dont waste your money in the PIL business. keep paying a little bit extra every month on your own, it really helps.... if you would have paid that little bit extra earlier now the pinch would not be so bad. so learn.
RE:EMI
by Benedict Fernandes on Apr 09, 2007 11:39 AM Permalink
Yes I am with you government is not bothered about anyone..They just have there pockets to fill...We people have to stand up...There is wisper to raise the home loan and behold ICICI is the first one to raise the home loans...They are all thives...God Bless Them
RE:EMI
by Robin Mitra on Apr 09, 2007 12:12 PM Permalink
Definitely , we should make a presentation to the finance minister about our woes. Finally it is us who will keep him in his seat....he had better listen to our genuine problems.
RE:EMI
by Kishor Nadkarni on Apr 09, 2007 12:02 PM Permalink
Rajeev, Yes I am with you, we should form a club & we should fight for our rights. Govt & HFCs are thives.
My dear friends, Please do not break your head. Everything depends on the Government policy. Instead of we break our head let our Government thik over it.
RE:House Loan Interest Rate
by chandraprakash suryawanshi on Apr 09, 2007 12:00 PM Permalink
why people were not complaining when the rates were going down, they were all happy. It is market and the inflationary pressures which is driving interest rates up to reduce liquidity. It's true that private banks rise interest rates faster and charge for preponing loans while most public sector banks does not. ICICI bank specially needs to be blamed as there portfolio is maximum for home loans and share bigger responsibility. They hike the rates fast, as once you borrowed, you cannot prepay without hefty prepose charges and for attracting new customers, they will still give some discounts and once they also take loans, in some 3 months they will see the rate hike too as they are also trapped
RE:House Loan Interest Rate
by Sunil kumar on Apr 09, 2007 12:31 PM Permalink
I think this is wat going to happen , Prices are going to come down atleast by 20% within a year and as purchasing price of people cannot cope with high EMI and also you can only make 0.2-0.25% of your flat cost as rent per month (assuming flat is 40L and u get 10K rent) this is if you wish to live in a rented space and giev your flat for rent to make up for EMI . It is actually abest time to sell and get a better flat at a little lesser cost 2 yrs from now
RE:House Loan Interest Rate
by anil b on Apr 09, 2007 02:00 PM Permalink
HI ,
40 lakhs and getting a return of 1.2 lacs per annum .the return works out to be some 3 to 4 percent range per annum .why cant people evaluate on the basis of returns . if they had done that probably they could have avoided their troubles .in india people go crazy about real estate and the hype by the media .god help them ??????
