Information – Knowledge +
Basics of a home loan
Basics of a home loan
3 Feb, 2008, 0544 hrs IST,Kavita Sriram, TNN
Times are fast changing. Remember when your father purchased a house? In all probability, it was when he was close to retirement. It was possible to have saved enough money to buy a house only after years of working.
Supplemented with his retirement money, he could have managed to purchase a house. Today, many homeowners are young people in their thirties. Thanks to banks offering loans and increased earning capacities, buying a house is no longer a distant dream.
Borrowers can live in the property, even when they are still repaying the loan. At the end of it, you have an asset that has multiplied manifolds in value. Home loan enables you to do just that.
Banks give home loans for constructing a home or purchasing a ready-built house, flat or residential plot. They even re-finance existing loans that borrowers may have availed from other banks. The loan amount sanctioned to borrowers is based on age, salary, educational qualifications, credit history and previous employment track record.
You can club the income of your spouse, in order to increase your loan eligibility. Typically, banks only lend the amount where your monthly EMI outflow is 30 to 50 percent of your salary. Any amount greater than this would make repayments towards the loan a burden and one may default.
What is EMI?
EMI stands for equated monthly installment. It comprises interest and principal components. EMI repayments commence when you take a full disbursement of the loan amount. Pending final disbursement, borrowers only pay interest on the amount disbursed. This is called the pre-EMI interest.
When a borrower makes EMI payments to the lender, during the initial years, a large chunk of money will flow towards interest repayment. As the years roll by, the principal component increases.
If you do not own a house of your own, it is time you consider taking a home loan. Borrowers can also avail tax benefits on both the principal and interest components of the loan. This makes it even more lucrative.
Options in home loans
Home loans usually come in three flavours – floating, fixed and hybrid. In case of a floating rate loan, the interest rate fluctuates with the prevailing market rates. It is usually pegged against the bank’s prime lending rate.
This moves up or down depending on the movement of repo rates, inflation, cash reserve ratio and liquidity in the system. Exposed to a host of external factors, a floating rate of interest is simply unpredictable. But as much as 80 to 90 percent of the borrowers have opted for the floating rate.
Borrowers, who opt for the floating rate, intend to benefit from a fall in interest rates. If, on the contrary, the rates go up, they have to pay out more money in the form of EMI to the lender.
They understand that interest rate fluctuations follow a cyclic pattern and are further lured in by the lower cost of this loan. If you are taking a short-term loan, simply float. It is difficult to predict the interest rate scenario over a long term.
Pure fixed rate loans, as the name implies, remain fixed for the entire tenure of the loan. Such a product is offered by very few banks as interest rate on them is very high compared to floating rate loan. What most lenders offer is fixed rate loans – fixed for a short tenure, say five years. So the rate remains fixed for five years, after which the interest rate is reset to the value prevailing at that time.
Fixed rate is for borrowers who are anxious every time the rates climb up. Those who want predictability and want to set aside fixed money towards their loan repayment can select fixed loans. Such borrowers believe that the rates will travel northwards.
Before locking into a fixed rate, go through all the fine print to know how ‘fixed’ the product really is. If it comes with a reset clause, it means the bank can at its own discretion increase your rate, though it is called a fixed rate loan.
Between the fixed and floating rate option, investors have the hybrid loan alternative. It is a combination of fixed and floating rate loan, where a borrower can decide how much he intends to lock under fixed and how much he wants to expose to floating rates.
If you’re unsure simply lock 50 percent of the loan under fixed and remaining under floating rate. This innovative product gives more flexibility and option to the borrower.
With interest rates giving all indications of going southwards, it is time to consider investing in a house. A home loan will help you realise your dream of owning a house.
Scientists create ‘no tears’ onions
Scientists create ‘no tears’ onions
WELLINGTON (AFP) – Scientists in New Zealand and Japan have created a “tear-free” onion using biotechnology to switch off the gene behind the enzyme that makes us cry, one of the leading researchers said Friday.
The discovery could signal an end to one of cooking’s eternal puzzles: why does cutting up a simple onion sting the eyes and trigger teardrops?
The research institute in New Zealand, Crop and Food, used gene-silencing technology to make the breakthrough which it hopes could lead to a prototype onion hitting the market in a decade’s time.
Colin Eady, the institute’s senior scientist, said the project started in 2002 after Japanese scientists located the gene responsible for producing the agent behind the tears.
“We previously thought the tearing agent was produced spontaneously by cutting onions, but they proved it was controlled by an enzyme,” he told AFP from his home outside Christchurch.
“Here in New Zealand we had the ability to insert DNA into onions, using gene-silencing technology developed by Australian scientists.
“The technology creates a sequence that switches off the tear-inducing gene in the onion so it doesn’t produce the enzyme. So when you slice the vegetable, it doesn’t produce tears.”
Eady said that by stopping sulphur compounds from being converted to the tearing agent and redirecting them into compounds responsible for flavour and health, the process could even improve the taste of the onion.
“We anticipate that the health and flavour profiles will actually be enhanced by what we’ve done,” he said.
“What we’re hoping is that we’ll essentially have a lot of the nice, sweet aromas associated with onions without that associated bitter, pungent, tear-producing factor.”
The breakthrough has caused ripples overseas, following an international symposium in the Netherlands and after the trade journal Onion World featured Eady’s work on the front cover of its December issue.
Eady, who has several model onion plants at the institute, said despite the excitement about the prospect of “no tears” onions in every home, it would be 10 to 15 years before this happened.
“This is an exciting project because it’s consumer orientated and everyone sees this as a good biotechnology story,” he said.
“I’m more interested in sustainable production and the onions we are working on must be capable of being grown in an efficient manner.
“We have a burgeoning population to feed, and with climate change and other challenges, available resources are being reduced.
“The gene silencing system can also be used to combat virus diseases, and biotechnology in general can help us produce more robust crops.”
Five skills of creativity
Five skills of creativity
The Smart Crow Never Goes Thirsty by Moid Siddiqui Wisdom Tree
Creativity is the input, and innovation, the output, says Moid Siddiqui in The Smart Crow Never Goes Thirsty ( http://www.wisdomtreeindia.com). “Creativity is non-linear, numberless, and follows no set pattern,” he describes.
It is a tragedy, says the author, that we don’t provide our people with the ‘creativity toolkit’ even as we expect them to be creative. He faults the education system that emphasises the so-called scientific approach.
“More damage is caused, and disservice to creativity is done, by urging students and managers ‘not to be vague’. What they don’t understand is that ‘reality’ is always ‘vague’ at its ends. We encourage our people to be precisely wrong than vaguely correct.”
Siddiqui lists the five skills of creativity, as follows:
Divergent thinking (to move from the focused to the blurred, for obtaining a wider range and a broader perspective).
Lateral thinking (by creating a forced relationship between remote objects, which seem to be unrelated, and thus forging a fusion).
Intuitive thinking (through which you can know the truth, though not know how you know).
Angel’s advocate (by focusing on the positive side of every idea).
Dissection of ideas (the application aspect of creativity to get something done).
The last skill requires the sieving of ideas for attractiveness and compatibility. The criteria of attractiveness include originality, simplicity, ease of implementation and copy protection. Aligning with company objectives and resource availability ensures compatibility.
An appetising guide to creativity!
D. Murali
Balance your liabilities
Balance your liabilities
26 Aug, 2007, 0441 hrs IST,Aman Dhall & Dheeraj Tiwari, TNN
If you thought getting a good deal for a home loan is the end of journey, then you may be missing out on a lot of action. Of course, getting a loan on a competitive interest rate is the first step, but if you’ve made regular payments and created a good credit record, you can use that to your advantage.
For those not in the know, this concept is known as balance transfer (BT), wherein the unpaid portion of your home loan is transferred to a new HFC at a lesser interest rate. We at SundayET find out what to look out for before you decide to go ahead with a BT.
Today, banks (read housing finance companies) are looking out for customers from whom they can benefit in the long run, and if you are looking out for a better deal, it’s not a bad idea to approach a housing finance company (HFC) to refinance your loan on a more economical interest rate. That’s not all. Banks such as ICICI, IDBI and SBI also offer additional benefits such as payment of your pre-payment charges or processing fee.
But there’s a catch here. On the face of it, the picture may look rosy. But if you don’t read between the lines, you can end up in a debt-trap. Take the case of Abhishek Shekhar, a 35-year-old doctor. He took a home loan of Rs 20 lakh at an interest rate of 10% two-years ago from Bank X. The tenure of the loan is 20 years. Now, recently he checked out with Bank Y, and after some negotiations, the latter offered him an interest rate of 8.5%. Now, let’s check out the financial gains of this deal:
On paper, such a calculation looks attractive. But what you need to check out is whether the bank has added the pre-payment amount to your overall loan principal. In fact, some banks hide this clause, thus increasing your loan amount by a considerable sum, plus the effect of compounding interest. Warns Kartik Jhaveri, a certified financial planner and a chartered wealth manager:
“You need to check out what all benefits you may get. The important points you should keep in mind before opting for a BT are — how will the bank handle your pre-payment charges, what other features you’ll get such as mortgage insurance and whether the bank calculates your interest on a monthly or annual basis.”
Jhaveri has a pulse on the problem. In fact, owing to competitive rates across the industry, there are not too many balance transfers happening as of now. Customers are also reluctant to opt for it due to the cumbersome documentation involved and the gains are not too big at the moment. “That’s a major reason why there aren’t any special rebates with reference to processing fees or rate of interest being offered to balance transfer cases. Although we have a facility where we can include the pre-payment charges to the principal outstanding balance, to be paid to the existing bank/ NBFC,” explains Sujan Sinha, senior VP, AXIS Bank.
On their part, the banks are trying to place their offers in a more positive light. “We generally have two kinds of options — ‘Simple Balance Transfer’ and ‘Balance Transfer with Top-up’. In the second option, along with balance transfer, a customer can avail of top-up loan amount based on the vintage of the loan,” says Rahul Mallick, general manager, ICICI Bank. The key levers for making a customer switch from one HFC to another is processing fee and preferential interest rate on balance transfers. “Typically, the new interest rate will be 200 bps lower than the existing loan rate. However, a lot depends on the customer profile and tenure of loan,” he adds.
So before you opt for a balance transfer, it is necessary to check with your housing finance company about the current rates. If you’ve made timely payments, it’s quite possible that the HFC can offer you a better deal. Also, compare that if you go ahead with a BT, will the cost be higher than repayment and switching to another housing finance company. “Balance transfer is not a good move if you’ve only five or less year of repayment left. But otherwise, it is a very easy process,” says Sanjeet Shukla, GM, SBI Personal Banking.
Small steps such as finding out the paperwork required, and if the new bank, will be using the original EMI cheques or fresh ones, can save you from further hassles. Balance transfer need not mean saving money, you can also utilise the same for investing in different options. After all securing a home loan is not the end of journey.
Yahoo Mail adds SMS, drops beta tag
Yahoo Mail adds SMS, drops beta tag
AP[ MONDAY, AUGUST 27, 2007 02:14:25 PM]
SAN FRANCISCO: Yahoo Inc. will introduce new features for its popular Web-based e-mail programme, including software that allows computer users to type text messages on a keyboard and send them directly to someone’s cell phone.
The enhancements make it easier to send e-mail, instant messages or text messages from a single Web site – no need to launch or toggle between separate applications or devices. It will take up to six weeks for all the new features to become available to all 254 million Yahoo Mail subscribers in 21 languages worldwide.
The most obvious beneficiaries will be parents, who will be able to use their keyboards to type messages sent to their children’s cell phones – no thumb-twisting typing on a dial pad, said Yahoo Vice President John Kremer.
“We’re giving you the right way to connect at the right time with right person,” said Kremer, whose two preteen sons vastly prefer text and instant messages to e-mail.
The changes come amid fierce competition among providers of free, Web-based e-mail services. Yahoo and Microsoft Corp’s Hotmail have long dominated the niche, but Google Inc’s Gmail has grown quickly since its introduction in April 2004.
In February, Yahoo announced that it would provide unlimited storage space, and earlier this month Redmond, Washington-based Microsoft said Hotmail would increase free storage from 2 to 5 gigabytes. Time Warner Inc’s AOL, the fourth largest e-mail provider, began offering unlimited storage last summer. Google provides nearly 3 gigabytes.
Are Leaders Born?
Are Leaders Born?
Most people fantasise about being in a leader’s shoes. But many believe this would remain wishful thinking because they are convinced that leaders are born. For them, people who influence their societies and workplaces are the ones who are born into certain families, have a certain pedigree and possess certain traits. According to research at the London School of Economics (LSE), leaders are very rarely born. Instead, they are the ones who are willing to take a decision to lead in situations when it is most expected from them.
Leaders are rarely born because:
They often do not carry any legacy nor are they from great families. People who have initiated and propagated great changes are seldom there because of a birthright. They emerged as and remained great leaders out of their own merit. They began with a decision to take on leadership and a determination to lead a cause that they believed in.
Traditionally, leadership skills were always thought to be something people are born with; that leadership is about being genetically lucky. But as researchers correlated scores on IQ and personality tests, they found only a modest and moderate relationship that did not differentiate leaders from non-leaders in any way. Even a behavioural correlation established the same. So, leaders were proved to be non-distinguishable from other people in terms of their intelligence and other abilities. Even as we study history, leaders seldom appear to have a past where they exhibited some extraordinary physical or mental capabilities, setting them several notches above other people. On the contrary, many of the world’s great leaders had been branded below average or just average individuals at some point in their lives. Each of them emerged as leaders because they took a decision to lead.
Leaders are hardly ever exceptional. And they need not be. Leadership is not something with which you are born, it is not inherited, but it is something you decide to do. Leaders are the ones who are bold enough to take a decision when they are faced with a defining moment.
If we examine corporate leaders, we see that this hypothesis holds good most of the time. Take Henry Ford. He not only revolutionised industrial production, but also had such influence over the 20th century economy and society that his combination of mass production, high wages and low prices to consumers is still called “Fordism”. His parents were poor immigrants from Western England where they were evicted from their land in Somerset. They underwent great tribulations as they came over to America looking for a new start.
As a child, Ford was quiet and inward looking, and spent much of his time around his mother. She died while he was very young, leading him into depression. His father despised him for not showing any interest or skill in farm work and literally wrote Henry off, saying he would never amount to anything. During most of his younger days, Ford apprenticed as a low-level machinist at various places, not even earning enough to lead a decent living. He did not own anything that could make him a born leader — no birthright, no pedigree and certainly no extraordinary attributes. Nobody ever recognised that he could do anything worthwhile. But when he took the decision to lead, he went on to be one of the greatest leaders the corporate world has ever seen. He brought on a new age of industrialisation and urbanisation owing mostly to his leadership in the automobile industry.
Even if we look at India, we see several first-generation corporate leaders who have built and led their empires, devoid of any family legacy. We can either learn from all their success stories and strive to be leaders ourselves, or we can retreat into our shell, presuming leadership to be something beyond our reach, reserved for those born with silver spoons in their mouths.
by Sangeeth Varghese / moneycontrol
The author is a leadership scholar from the LSE and founder of LeadCap. His book, Decide to Lead: Eight Decisions That Can Make You A Leader, will soon be published by Businessworld. He can be contacted at sangeethv@leadcap.org This email address is being protected from spam bots, you need Javascript enabled to view it
Shocked into creative living
Shocked into creative living
27 Aug, 2007, 0253 hrs IST,K VIJAYARAGHAVAN, TNN
The process of “getting tired of being tired”, in a larger context, can also be extended to one’s advantage, through waking up to the shocking realisation that he is drifting and is dissipating his talents and potential. It was rightly noted that even fault finding and impatience can be virtues, provided these are directed upon oneself.
In this manner, the seeker realises his infirmities and limitations — the starting point to laying down a path to emerge into a new world of excellence, right relationships and joie de vivre. This verily is also process of ‘waking up to make one’s dreams come true’.
The immortal Kannada film, Hamsagethe powerfully depicts the progression in the transformation of Venkanna, a gifted singer, who also yearns for moral perfection. In stages, through particular interactions and developments in his life, he overcomes the retarding factors of arrogance, pride, infatuation and overconfidence, which stand in the way of the pursuit of his vision.
Though accomplished and gifted in many ways, he realises that he has miles to go to even comprehend the spark of that divinity, which verily is that power, in all bliss and joy and harmony with all aspects within and without, expressed often as outpourings of true Bhakthi.
The prerequisite, therefore, in many cases, for this awakening, is often that of being shocked into feelings of dissatisfaction, if not disgust, with one’s present state of mind, body, heart and soul. This state within is also reflected in situations, relationships and circumstances which attend upon him. Such wake-up calls, as blessings in disguises, transform, sometimes, even the most ordinary into extraordinary beings, endowed with supreme powers.
The story is often told of a great saint and poet, who once was highly attached to worldly comforts and fiercely infatuated with his newly wedded wife. One day, during the height of his over powering passion, his wife jokingly taunted him, “Why don’t you divert at least a part of this attachment for me to God?” As if instantaneously, the young man experienced a metamorphosis, to realise his mission in life.
Indeed, contentment stays as a virtue, only when applied to material and mundane pursuits. For sublime aspirations, the seeking aspirant should hitch his wagon to the highest star. Only then would he be truly fulfilled and be satisfied in the self by his own self, delighting in himself and be genuinely contended — in the manner conceived of by Bhagawad Gita.
Soap that cleans clothes with less water
Soap that cleans clothes with less water
27 Aug, 2007, 1131 hrs IST, IANS
MELBOURNE: Wasting water to rinse that extra lather from your clothes may be a thing of the past now. Scientists in Australia have developed a detergent that cleans clothes with less water.
Normal detergents contain surfactant molecules, which are oil-friendly at one end to capture dirt and water-friendly at the other to pull it away. They also tend to form bubbles, which require extra water to rinse.
Researchers at the University of Queensland in Brisbane, Australia, have made a surfactant that only forms bubbles under mildly alkaline (that contain soluble mineral salts) conditions.
The unusual product, which is a biological detergent, has been named pepfactant because it is made from peptides (specific acids).
The inventors – Annette Dexter and Anton Middleberg – said the unique aspect of pepfactants is that it can be switched on or off, depending on its intended application.
For example, in laundry detergents there’s a built-in pH (a measure of the acidity or alkalinity of water) change that occurs between the wash and rinse cycles.
Pepfactants designed to respond to that change could be added to the detergent to reduce the rinse time, reports UPI news wire.
Detergents tend to be alkaline, so during a wash cycle the molecules link to form bubbles. The rinse water lowers the pH, breaking the bubbles apart, so less water is needed to wash out the lather.
Soap bubbles that collapse once clothes are clean could reduce the water needed during washing, the scientists said.
Pepfactants could also control the mixing of oil and water in industrial processes, according to a report in the online edition of New Scientist.
Dexter believes the more near-term application might develop in the personal care area, such as a shampoo, conditioner, skin cream or hand wash. There also could be potential applications for eye drops, she added.
“Mission impossible”: Beaking the speed of light
“Mission impossible”: Beaking the speed of light
(DPA)27 August 2007
HAMBURG – Two German physicists from the University of Koblenz claim to have done the impossible and broken the speed of light.
If their claims are confirmed, they will have proved wrong Albert Einstein’s special theory of relativity, which requires an infinite amount of energy to propel an object at more than 186,000 miles per second.
However, Dr Gunter Nimtz and Dr Alfons Stahlhofen, say they have possibly breached a key tenet of that theory.
They say they have conducted an experiment in which microwave photons – energetic packets of light – travelled “instantaneously” between a pair of prisms that had been moved from a few millimetres to up to one metre apart.
When the prisms were placed together, photons fired at one edge passed straight through them, as expected.
After they were moved apart, most of the photons reflected off the first prism they encountered and were picked up by a detector. But a few photons appeared to “tunnel” through the gap separating them as if the prisms were still held together.
Although these photons had travelled further, they arrived at their detector at exactly the same time as the reflected photons. In effect, they had travelled faster than light.
Dr Gunter Nimtz, one of the physicists from the University of Koblenz, told New Scientist magazine: “This is the only violation of special relativity that I know of.”
The duo say being able to travel faster than the speed of light would lead to a wide variety of bizarre consequences.
For instance, an astronaut moving faster than it would theoretically arrive at a destination before leaving, they said.
The scientists said they were investigating a phenomenon called quantum tunnelling, which allows sub-atomic particles to break apparently unbreakable laws.
“For the time being, this is the only violation of special relativity that I know of,” Dr Nimtz told New Scientist magazine.
Two moons on 27 August
Two moons on 27 August*
*27th Aug the Whole World is waiting for…*
Planet Mars will be the brightest in the night sky starting August.
It will look as large as the full moon to the naked eye. This will
cultivate on Aug. 27 when Mars comes within 34.65M miles of earth. Be
sure to watch the sky on Aug. 27 12:30 am. It will look like the earth
has 2 moons. The next time Mars may come this close is in 2287.
Share this with your friends as NO ONE ALIVE TODAY will ever see it
again.
ClicksandWrites 
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