Loans have become an integral part of our lives. Whether you are a businessman looking for working capital or a salaried employee seeking a home loan, a student looking to study abroad or a housewife wanting that microwave oven, loans are the way out for most.
But do you know what to keep in mind while opting for a loan? Take the Rediff Biz Quiz and find how much you know about loans. 1. When you are comparing loan offers, you should take care to evaluate which one of the following? 2. What is the percentage of monthly income which you should take care not to exceed while spending on daily utilities, loans, regular monthly expenses, etc? 3. You are looking to take up a loan at a low interest rate for a large sum of money to fund a sudden emergency. Which of the following options will you choose? 4. You have reached the credit limit on three credit cards and interest rates are climbing higher and higher with each passing day, what do you do? 5. Which of the following is the 'SARFAESI' Act?
a) Loan tenure
b) Total loan cost
c) Interest rate
The correct answer is total loan cost
The total money outgo from your pocket will include not only the interest rate of the loan but also aspects like processing fee, service charges etc. that form a percentage of the total loan cost and can make a significant difference, especially when interest rates between two offers are more or less the same.
The total money outgo from your pocket will include not only the interest rate of the loan but also aspects like processing fee, service charges etc. that form a percentage of the total loan cost and can make a significant difference, especially when interest rates between two offers are more or less the same.
a) 100%
b) 80%
c) 60%
The correct answer is 60%.
You should take care to set aside atleast 40% of your income towards savings and investment to enable you to handle future expenses like a downpayment for any loan, child's education, vacation expenses, investments, retirement planning etc.
You should take care to set aside atleast 40% of your income towards savings and investment to enable you to handle future expenses like a downpayment for any loan, child's education, vacation expenses, investments, retirement planning etc.
a) Business loan
b) Personal loan
c) Loan against property
The correct answer is loan against property .
When a large sum of money is required opting for a personal loan may seem like the first feasible option but since this is an unsecuritized loan, the interest rate can be quite high, also the repayment tenure is likely to be less. On both these counts LAP works out better as it is a securitized loan and repayment tenure can be much longer.
When a large sum of money is required opting for a personal loan may seem like the first feasible option but since this is an unsecuritized loan, the interest rate can be quite high, also the repayment tenure is likely to be less. On both these counts LAP works out better as it is a securitized loan and repayment tenure can be much longer.
a) Declare yourself bankrupt
b) Apply for a personal loan and clear your debts
c) Buy another credit card with lower interest rate and rotate the credit
In this case, credit card interest rates are much higher than that of a personal loan and keep compounding. Hence it makes sense to opt for a personal loan and close the highest amount pending with your credit cards first.
In this case, credit card interest rates are much higher than that of a personal loan and keep compounding. Hence it makes sense to opt for a personal loan and close the highest amount pending with your credit cards first.
a) Empowers the banks and financial institutions with the right to recover the mortgaged property in case of loan defaults, without the intervention of the court.
b) Empowers the bank to demand money back from a loan defaulter
c) Empowers the individual to delay the bank from auctioning his home due to defaults
The correct answer is empowers the banks and financial institutions with the right to recover the mortgaged property in case of loan defaults, without the intervention of the court..
This act has been put in place to help banks recover the money that they lent in case the borrower defaults on the home loan and the bank has no other way to recover the money.
This act has been put in place to help banks recover the money that they lent in case the borrower defaults on the home loan and the bank has no other way to recover the money.
article