| Govt wants banks to go slow on sensitive sectors
MUMBAI: The government is nudging all public sector banks to go slow on loans to sensitive sectors like stock market and real estate and prune outstandings like credit card receivables. In a recent letter to the state-owned banks, the finance ministry has said "public sector banks need to have a re-look at the continued high credit growth in the sensitive sectors and take necessary steps for rebalancing overall credit portfolio." The March 29 letter, issued by Amitabh Verma, joint secretary in the banking division, comes against the backdrop of a continued rise in the share of sensitive credit — real estate, commodities and stock market. The banking regulator, RBI, has also shown concern on ballooning personal loans and credit card portfolio of banks. These loans are unsecured in nature and are more prone to defaults.
Be Wise By Consolidating Your Credit Card Debt And Saving Money!
It is essential once you decide to consolidate your debt to evaluate if you are going to be saving money while at it. This is a critical issue because, though you may end up paying lower monthly installments, the consolidation loan may turn up to be more onerous than your current outstanding debt. Thus, unless you cant handle your payments in another way, you should consider other alternatives. So, unless your only option is to lower your monthly payments by extending the repayment program and coping with a higher or similar interest rate, you should try to get the best deal on your consolidation loan with the lowest interest rate available and only extend the repayment program if you need low monthly payments. If you can afford higher payments, you should do so because that way you would be saving money while at the same time shortening the time needed to be debt-free.
Free Mortgage? Look Again
It's hard to turn down a bargain. You've seen it on television: order in the next five minutes and get a free gift. Maybe you won't buy the latest gadget for $19.95, but if they throw in two gadgets, then how can you resist? The mortgage industry is exactly the same, with one catch: the money involved is a lot more serious. After all, if you can really find a "no-cost" mortgage, you could save thousands. Especially with Internet-based lenders like Popular's (Nasdaq: BPOP) E-Loan and GMAC's (NYSE: GM) Ditech, you'll often see opportunities to get a new loan or refinance an existing loan with no out-of-pocket costs. However, free offers are rarely simple acts of kindness. With those TV offers, if a gadget costs $0.50 to make, the manufacturer can afford to give you two for the price of one and still make a big profit.
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