| Banks warned against giving big unsecured loans
Dubai: The Chief of Dubai Police has warned five banks they will be named and shamed if they do not stop giving loans without guarantees and through big enticements, as many people have got into trouble for failing to pay off their debts. Lieutenant General Dahi Khalfan Tamim said he will personally adopt a resistance movement against those banks which are also listed on Dubai Police's blacklist. He pointed out that 60 per cent of cases of bounced cheques or inability to pay back debts come from those banks. Their cases amount to 70 per cent of the total cases. Luxury items The warning came during an open discussion on the security of bank loans yesterday in which bank representatives, legal experts and economy experts took part. Dr Mohammad Murad, Director of Dubai Police's Decision Support Centre, pointed out that banks should contribute 50 per cent of the expenditure of inmates jailed for bank-related cases, as the cost of one inmate amounts to the cost of a person staying in a five-star hotel.
Choose the right type of mortgage for your needs
You'll likely face many major decisions to make when you're ready to take the homeownership plunge, not the least of which is choosing the right kind of mortgage for your needs. Mortgage options used to be fairly limited, but in recent years new varieties have abounded. Here are some of the more common types: Fixed-rate mortgage. You make the same monthly payment throughout the term of your loan, usually 15, 30 or even 40 years. Shorter-term mortgages offer lower interest rates but higher monthly payments, so you may not be able to afford as expensive a house. However, over the life of the loan you'll pay thousands of dollars less in interest - and, you'll build equity in your home much more quickly. Adjustable-rate mortgage (ARM). Your interest rate and monthly payment move up or down, depending on how the market index it's tied to performs.
Giving credit where due
Dubai-based Emcredit, the UAE's first commercial credit bureau, was begun primarily to help small businesses obtain access to money. Economists have long understood that these entrepreneurial firms are the most powerful engines of both economic growth and job creation. They also know that access to capital is their lifeblood - they cannot survive much less prosper without it. But potential lenders have a problem, which is how to evaluate an entrepreneurial business to determine its credit worthiness. "Lenders don't have the information they need," says Emcredit CEO Bashar Saleh Qallab. "Improving the reliability of credit information allows lenders to penetrate under-represented markets." As Emcredit took shape, Qallab realised that questions about the credit of a small business could not be separated from the person who owns the business.
Countdown to Budget Day
GORDON Brown is tipped to announce a major shake-up of student loans in this week's Budget, which would involve packaging them up and selling them off to private loan companies. A small amount of loan money has already been parcelled off, according to the National Union of Students (NUS), but the Chancellor is expected to announce the sell-off of the entire £16bn student loan book when he delivers his 11th Budget speech on Wednesday, promising to use the money to boost education programmes. .
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