l In a construction-linked home loan, what happens to the loan if the builder defaults in delivery of the flat? Do I still have to pay the EMIs?—Ravi Gehlot
Unfortunately, that is a risk with construction-linked loans. Even if the builder defaults on delivering possession, your financial liability to the bank remains, and EMIs must still be paid regularly. While some affected buyers have approached the courts seeking EMI waivers with varying outcomes depending on the case, non-payment will negatively impact your CIBIL score.
l I have some bank deposits earning 7-8% interest. I need some money now. Is it better to take a loan against these deposits or encash them?—Prashant Verma
The decision between taking a loan and premature withdrawal depends on the amount required and your expected repayment timeline. If the required amount is small relative to the fixed deposit and you are confident you can repay it within 12 months, taking a loan against the deposit is generally better.
l My home loan is still on MCLR which I had taken in 2015. Is it better to shift to repo rate and what will be the conversion fees?—Sanchit Gupta
Yes, a repo rate-linked loan would be a better choice. Please check with your bank to process the conversion. The charges are usually minimal, though they vary by bank.
l I am planning to take a loan of Rs 10 lakh against my property. Do I have to give all the property chain of documents for the loan?—Devanshu Sharma
Yes. A loan against property involves mortgaging the property in favour of the bank, so the complete chain of original documents must be submitted to the bank.
l My parents have a plot of land registered in their name and we want to build a house on it. I am a salaried employee. Can I take a joint loan with my father who is a businessman?—Nippun Jain
Yes, this is possible. You and your parents have to jointly apply for the house construction loan.
l I had taken an education loan for my son two years ago. The repayment will start after six months. Can I prepay the entire amount without any penalty?—Vivek Kumar
Yes, you can prepay the education loan without any penalty.
The writer is founder, AZUKE Personal Finance Advisory (www.azukefinance.com). Send your queries to fepersonalfinance@expressindia.com
Disclaimer: This article is for informational purposes only and should not be construed as investment advice. Investors should assess their financial goals, risk appetite and consult a qualified financial advisor before making investment decisions.
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