How To Lower Your Home Insurance Costs?

While insuring your most-valued possession is important, you are often wary of the costs you have to bear without actually claiming anything. It’s a double whammy — you want your possession to be safe, so you would want it insured, but paying the premium without any gain pinches.

MakaanIQ looks at some of the ways in which you may lower your home insurance policy premium.

Don’t opt for over-insurance

Your insurance company may suggest that you opt for a much wider coverage than you actually require. After all, the company’s business depends on the hefty amount it gets from you in insurance premium. However, in case of any loss, the company will not pay you on the basis of the insured value but on the actual amount of loss. You end up paying a higher amount in premium, without even reaping any actual benefit from it when you go for a heavy insurance cover.

Improve your rating

Insurance companies attach a lot of importance to a person’s credibility. As a buyer, you are in a better position to understand the factors that may cause any damage to the property in future. Keeping the insurer in the dark about such details may have a negative impact on your credibility. In case of any losses, your insurer may act difficult to pay for damages.

Raise your deductibles

The deductible amount in an insurance policy is the amount of loss that you agree to bear yourself, and any loss in excess is passed on to the company. Increasing the deductible lowers the premium you pay, as this liability of the insurer is reduced. For example, if you take a home insurance policy of Rs 50 lakh, with a deductible of Rs 1 lakh, this means any loss within Rs 1 lakh is borne by you; and any loss exceeding that amount will be the responsibility of the company to cover. This deductible component could reduce your insurance premium by up to 20 per cent. However, the deductibles should not be raised to such a level that the insurance becomes meaningless. Maintaining a balance is of great importance.

Keep it secure

To lower security risks, you may install anti-burglary devices, CCTV cameras, infrared sensors, deadbolt locks, metal doors, safe deposits, etc, at your home. As the probability of burglary is reduced by applying these measures, a company will be more willing to insure you and offer rebates. You may build an earthquake-resistant structure and get fire extinguishers installed to avoid other disasters and also reduce the cost of your insurance.

No-claim bonus and other discounts

Insurance companies reward customers who do not make claims by way of a no-claim bonus. Various other discounts can also be availed of by being aware. For example, members of many professional bodies like Medical Council of India, The Institute of Chartered Accountants of India, The Institute of Company Secretaries of India and corporate employees are given discounts by insurance companies. Do ask your insurance agent about the discounts that you may avail of before opting for a policy.

Compare the plans

It is better to shop around for better deals available in the market. The same company can have many plans, some of which could suit your needs better. You may also decide between a public and private insurer for better deals.

Also keep these in mind

  • Staying with the same insurer is more rewarding than switching from one insurance company to another every year. Also, it is more economically beneficial if you take the different insurance policies — automobile, health, home, etc — from the same insurance company. Many companies offer discounts if you have multiple policies with them.
  • The cost of insurance across different insurers can be easily calculated online by using portals. Applying for insurance policies online also saves money as there is no middleman involved.

Can Future Rental Income Help You Get A Home Loan?

A steady monthly income for salaried employees makes it easy for them to get home loans. In the absence of such a guarantee, banks adopt stricter measures to gauge the loan repayment ability of the borrower. Interest rates are often higher and tenure shorter in those home loans that are not perceived entirely risk-free by banks. Businessmen and property owners looking for a home loan against future rental income, would find themselves in this spot. In this article, we answer the question a landlord might have with respect to his home loan eligibility.

Can you get a home loan?

Since you are already earning a rental income, you are eligible to get a home loan. However, through a rigorous process banks would find out whether you pose any financial risks.

Keeping the risks in mind, the bank may charge you one per cent of the loan value as processing fee (they waive this off in case of salaried applicants), as well as higher interest rates and shorter loan tenures (up to 10 years). Typically, the loan tenure would not exceed the period till which the property is already leased.

Do note that you cannot get a loan on future rent generating capacity of the property you are going to buy using the home loan. However, senior citizens who are earning a pension can avail of housing finance in this case.

 

Checks undertaken by banks

The bank would first investigate your rental income in the past and its consistency. A technical and legal inspection of the property will be initiated to establish its future potential, since the repayments largely depend on it. The bank would also use the property as the security against the loan.

 

How to make the home loan application stronger?

Applying for the loan jointly with a co-applicant who earns a stable monthly income will improve your chances of getting a home loan. Banks would also be more willing to lend you money if you pay a considerable part of the property value— 40 per cent or more, upfront. Another option is to find a loan guarantor. Additionally, the borrower must strive to create an impressive credit history over a period and a solid track record, something greatly valued in the world of banking.

Broker’s Corner: 4 Inbound Marketing Techniques You Must Know Of

No one likes to receive a sales call. Still, there are thousands of brokers who follow the conventional cold-calling as a daily routine to keep the ball rolling. Though the success ratio always remains questionable, as brokers have become habitual to this marketing tactic.  

With the Telecom Regulatory Authority of India (TRAI) enforcing a National Do Not Call (NDNC) Registry, brokers need to ensure that their cold-calling tactic does not put their number on the block-list.

Cold-calling is anyway a laborious process. You call hundreds of people and hardly a handful may turn out to be leads and even fewer become your clients. Isn’t that a waste of time, energy and money?

With digitalisation and advent of mobile applications, people can easily identify a spam number and block it instantly. Technology is fast changing the way brokers try to find leads from a tele-calling database, is not productive anymore.  

MakaaniQ talks about four inbound marketing tactics that score above cold calling and produce great results for your brokerage business.

What is inbound marketing?

As the name suggests, inbound marketing is all about generating qualified leads who contact you rather than you contacting them. The chances of conversion, in this case, are much higher as a person will contact you only when there is a genuine need to buy property.

These are the people who have passed through a funnel and are aware of your service offerings and capabilities. Now the biggest question is how to master inbound marketing? Read on to know the answers.

Property listings

If you are not present prominently on property listing websites, you are losing big opportunities. In fact, you are letting your competition take up those opportunities.  Property listing sites are a huge network of content, design and technology. They enjoy high brand visibility in the market and most property buyers tend to use their services, which are generally free of cost.

If you are part of these websites, your probability of appearing in front of prospective buyers is immensely high. Buyers can contact you directly and then you can take the process forward.

Email campaigns

You can develop a database of email IDs of people who have interest in buying property and then do an email blast through mass mail automation systems such as Mailchimp, SendinBlue, YMLP, etc.

However, for this purpose, you will have to work diligently to collect email IDs of relevant people otherwise you will face high rates of people opting out of your emailers. You can develop a database by putting email IDs collected through inquiries generated through property listing websites, your own company website, direct outdoor marketing or social media campaign.

SMS campaigns

This is yet another way to reach out to masses through passive mode. Although it is again a non-solicited method of contacting people.

Social media

Sharing high-quality information about properties available with you through social media platforms such as Facebook, LinkedIn, YouTube, etc. can help generate inbound leads.

The success of all the above inbound marketing tactics rely on the way you present information. No matter how much effort and resources you put into these modes, if the content is not relevant for the targeted audience, they won’t respond to you.

At the same time, once you develop the right mix of content and presentation, these platforms bring in tremendous rewards. Last but not the least; it is the game of consistency and patience.   
    

How To Check If Your Property Is Legally Verified?

Finding a property that is free from all sorts of legal tussles is quite an achievement. With the momentous growth of the real estate sector, the number of disputes over land have also gone up. Behind many a project delay, fights over land ownership have been a prime reason. Though the real estate law, which is in various stages of implementation across the county, is going to make the situation more favourable for property buyers, here is a do-it-yourself checklist to know whether the property you are shortlisting is worth investing or not:

Check for the title papers

A property should have a clear title, without any dispute. If buying a new property, the title of the land should be with the construction company. If buying a resale one, study the papers wisely or visit the property lawyer to check the authenticity of papers.

Ask for bank approvals

If you are getting your home financed from the bank, your half work is already done. Before approving your loan, banks evaluate the property. For an apartment project, several banks offer on-site offers which clearly indicates that the property is legally verified and have all approvals in place. But, do check the clauses before signing the loan agreement with the bank.

Encumbrance certificate

An encumbrance certificate is a document which implies a property is legally free from any mortgage or pending loan. It also lists the name of the previous owner of the property. This is a very important document when buying a resale property to know whether the previous owner had mortgaged the property and if all the dues have been paid.

Tally the approved plan with actual site

If you are buying in apartment project, make sure you get to see the copy of the approved map from the builder which is passed by the local authority. This can give you the fair idea about the area and the construction spree if it illegally encroaches.

Check out property tax slips

If buying a resale property, ask for property tax slips from the previous owner. This will give you an insight on two factors ― whether the colony or the area you are buying in is regularised or illegal and if the property is duly registered and there are no dues pending with the municipal authority.

Project has a registered society

Every apartment project should have a registered society along with a resident welfare association. This is itself a legal process and also gives an idea about the legality of the project and the property you are buying.

There are lot many things you need to do before you buy a property. You might spend all your savings or get a loan from banks. So, it is important to take these points seriously and make a decision with a peace of mind.

How To Plan Early On, To Buy Your Dream Home

Owning a home is a satisfying feeling. For homebuyers in India, a home is more than brick and mortar – it is an asset where they invest not just financially but also emotionally. However, the feeling of owning a home can become mentally disturbing if you don’t have a plan in place to save for the expenses related to it. It is essential that you work on a strategy and start saving while young if you wish to buy a home. Here are a few ways in which you can plan early for purchasing your dream home, without burdening your budget.

 

Assess your budget

Know how much money you are going to need to buy a house that you want. Also, factor in the additional costs that you would have to incur such as registration and stamp duty charges, interiors, maintenance fees, etc. This way, you will know what you are aiming for and when you know the target, it will become easier to plan for it. If you are planning for a home loan, you need to arrange at least 40 per cent of the property cost to avoid any financial burden on your monthly expenses.

 

Start saving as early as you can

The market is full of saving instruments that give attractive returns and can help you create a corpus. Consider mutual fund investments through systematic investment planning, recurring deposits, provident fund, post office schemes, etc. While mutual fund investments are subject to market risks, you can invest in safer schemes such as equity which have a lock-in for three years and gives an average return of 10-12 per cent if you stay invested longer. Equity schemes will also offer you income tax benefits. Similarly, PPFs are tax-saving and offer returns up to 8 per cent. However, one can withdraw only 50 per cent of the amount after five years while the account has a lock-in period of 15 years. Recurring deposits offer up to seven per cent returns and are not tax saving but the easiest way to save money. Most of the banks offer RD facility to their account holders which does not require any documentation. You can start with a small amount and can keep on increasing it if your budget allows. For instance, start a monthly RD of Rs 5,000 and you can open another one for Rs 3,000 monthly.

 

Create your credit history

If you will be taking a home loan for buying the property, you need to have a strong credit history to negotiate a good deal with the lender. A good credit score can be created if you make timely payments of your credit card, use credit cards for big transactions and get your credit limits increased every year. The credit score basically indicates your capacity to pay back the EMIs and the risk associated with you as a borrower.

Also, maintain your debt-to-income ratio and pay off your previous loans before applying for a home loan. To calculate your debt-to-income ratio, you add up all your monthly debt payments and divide them by your monthly income. Your monthly income is generally the amount of money you have earned before your taxes and other deductions are taken out.

 

Look out for deals on loans 

Since you are planning early, you can check out deals and offers that are available in the market for home loan products. For instance, some banks waive off the processing fee while others have easy documentation and approve loans within days. You can also consider choosing between floating and fixed rates of interest. Usually, women homebuyers get interest rates discounts and other freebies. You can also get your home loan pre-approved to avoid last minute hassles and delays.

 

Create an emergency fund

For unpredictable situations, you should always have an emergency fund ready. It could be related to your pre-home purchase period or for after home buying. For this, you can invest in a mutual funds-liquid scheme which have minimal market risks with no lock-in. You can also earn returns on this fund and can withdraw it whenever required. 

 

What Does A Sale Deed Consist Of?

During your research before settling on a property, you may have come across something called the sale deed. It is the most valuable legal document that you shall possess upon purchasing a home. Based on the purchase deed, you shall be allowed to proceed with registration and mutation of the property. The sale deed or purchase deed is drawn upon a non-judicial stamp paper by legal draftsmen according to the value prescribed by the stamp duty act of a state.  

When you buy or sell property, the transaction is not legally valid without the buyer and seller signing the sale deed in the presence of at least two witnesses. Governed by the Registration Act, 1908, sale deed is the most important document for while selling or purchasing property in India.

Also Read: List of Documents Required for Buying Property 

Parties of the Sale Deed

Needless to say, a sales deed must begin with the details of the parties involved with the transaction. It should bear the name, age and addresses of the parties (buyer and seller) involved in the transaction, in order to make it valid. Both parties must sign and execute the deed with bona fide intention.  

Description of the sales property

The sales deed must have a proper description of the property you intend to buy. For instance, if you are buying a 3BHK in Bandra, the sales deed should have the total plot area, identification number, details of construction, the exact location and surroundings. The property schedule must be incorporated in the sale deed to define the accurate location of the property.

Sales Agreement

This document is drawn up when you pay a booking amount for your new apartment in Mumbai. This agreement states that both seller as well as the buyer shall mutually settle the conditions and terms of the agreement so that it won’t affect the rights of either party. Usually, the sales agreement is drawn up before the sale deed.  

Clause of sale consideration

The amount agreed between the buyer and seller must be included in the sale consideration clause. This is the amount that the buyer agrees to pay to the seller during the sale deed execution. The sale amount should be stated clearly on the deed, as it was agreed upon.

Advance Payment and Payment Mode

If you have paid anything in advance to the builder or seller for booking the flat, then this should be mentioned in the sale deed clearly. The remaining amount payable must also be written in the document.   

The mode by which you will be paying the amount—cheque, cash or DD must be mentioned along with the consent of the seller to accept it in the form.

Passing of the Title

The sale deed should mention when the property title shall be passed to the buyer. The seller must be given a time limit for the title transfer. Once the title has been transferred, all related rights shall pass onto the buyer.

Possession Delivery

A clause in the sale deed must bear the information that the possession of the property shall be transferred to the buyer by the seller after completion of the registration process. The sale deed should state the actual date of delivery of possession.

Indemnity Provision

This is mostly applicable in case of a resale property. The clause states that the seller should clear all statutory charges such as electricity bill, property tax, water bills, maintenance charges and society charges and all other dues prior to the sales deed execution. In case a home loan was taken to purchase the property by the original buyer, then the seller must repay the loan and get the papers back from the bank. As a conscious buyer, you should scrutinize the status of encumbrance from the sub registrar or registrar’s office.  

Default Clause

Sales agreements should ideally bear a clause that if there is any default on the part of the buyer or seller then the party defaulting shall have to pay a penalty to the non-offending party so that the execution of the sale deed is not affected.

Once the sale deed has been prepared, it must be ratified by two witnesses from both sides. The witnesses shall have to provide their full addresses, signatures and names. The signatures of the buyer and seller must be present in every page.

Tips To Make Your Home Healthy

The prerequisite to a happy and healthy life, is a clean environment, which can only be achieved when your home is healthy.

To ensure that your home is healthy and promotes well-being, PropGuide lists certain aspects you should take care of, when building a home. 

Natural air & light

The first step towards a healthy home is to have ample natural light and ventilation to ensure clean and fresh air. The right kind of home will not require any electric light during daytime. A home should be designed with enough doors and windows to ensure ventilation. 
A home with good amount of sunlight plays a good part in keeping away termites and other pests, providing natural disinfection, as well.

Hygiene & sanitation
For a healthy home, maintaining hygiene and clear sewage and waste outlets is important. To ensure this, piping and plumbing of homes that are being constructed should be cross-checked to make sure that none of them have a possibility of becoming a breeding ground for pests, giving rise to diseases. Bathrooms should be designed to ensure that water drains do not clog. Use easy to maintain and clean tiles in the bathroom. 

Potted plants

It is tough to get a breath of fresh air in a busy city. So, why not create a healthy environment in our homes itself. Install potted plants around the house. These plants clean the air, thus, freshening the home. You can also install fragrant plants like jasmine and roses, plants with medicinal qualities like tulsi or even plants, which can be used for cooking purposes like bay leaves and mint. In fact, a number of enterprising home makers also plant spices in the kitchen for flavour and utility purposes.

Quality-check construction material

The excessive use of chemicals during construction can cause immediate as well as long-standing allergies to its residents. Always check the quality of wood, fabric, and other construction material being used. Care should be taken to avoid products which can be allergic. Also, avoid mass produced synthetic construction material, which are likely to contain more hazards.

Solar installation

Reducing the use of electricity and using solar-based installations are also key to building healthy homes. These energy-efficient technologies can make sure that pollution is lowered and contribute to your general health. It’s for larger good. 

Vastu: How Mirrors Influence Money And Health Status

Are you planning to buy a home? If it is an under-construction property, then getting it customised according to your wishes is easier. But, what if it is a ready-to- move-in apartment? It is not easy, but small changes to your ready-to-move-in apartment (where chances of customisation are minimal) can bring in lots of positive energy to the house.

A mirror is a very small object, but it plays an important role in bringing positive energy to your house. It has a significant Vastu component, which is capable of affecting positive as well as negative energy. Traditionally, a mirror is used as looking glass, but few know about an effect it can have on positive and negative energy.  Vastu Shastra classifies mirrors that have the capacity to stagnate and deteriorate energy. So, to lead a comfortable and peaceful life, it is important to place mirrors in appropriate positions and directions.

Applying simple changes in mirror placement could increase wealth in your house. Following are few Vastu tips regarding mirror positions.

Also Read: Vastu Tips For Study Room

 

Positive effect

  • If mirrors are placed opposite the locker of your house, this can double wealth.
  • Placing mirrors in the north direction is fruitful. As north is the center of Lord Kubera- God of Wealth, it is important to keep this direction energetic and positive.
  • To sustain good energies that help increase wealth, any kind of businessman can place mirrors adjacent to the cash box. This will not only increase the wealth but will also attract more customers.
  • For better health, mirrors in the bathroom should be on the east or north walls. This helps in removing negativity and bring in brightness.
  • In dressing rooms, mirrors should be placed within 4 to 5 feet above ground level.

 

Negative effect

  • South east is a fire direction. If you enhance this by placing a mirror, chances of quarrels and tiffs will become greater. So, avoid fixing looking glass in this direction.
  • Vastu Shastra advises not to place mirrors opposed to each other. This will encourage restlessness.
  • According to Vastu, the kitchen should not be in the north-east direction. This direction magnetic energy. So, fire can easily destroy positive magnetic energy.
  • According to Vastu, mirrors should not face north or east. This may reflect away positive energy entering from the north or east direction.
  • For a good health and peaceful sleep, mirrors should be avoided in bedrooms. According to Vastu, if there is a mirror in the bedroom then it should not face the bed.
  • Mirrors should not face the entrance or the entry gate of the house, as they reflect the energy entering the house.

 

Quick Vastu tips

*Square and rectangular mirrors are good for the house; oval and round shaped mirrors should be avoided.

*For positive results, individuals suffering from sleeplessness, headache or heart problems could place a three-inch mirror between the mattress and the bed, facing upward.

*Mirrors in the bathroom should be sufficiently lighted, and should be never kept in the dark. 

*Mirrors reflecting sunlight, a bed or main door attract negative energies. Hence, they should be carefully placed.

*Discard broken, rusted or unused mirrors in the house. These can be a source of hindrance for the overall positive environment.

*It is believed that using large mirrors in the dressing table and looking at oneself in it early in the morning increases positivity and is regarded auspicious.

*However, care should be taken while placing the dressing table in the bedroom. The mirror should never reflect the person on the bed that can lead to health issues.

*Never hang mirrors on the ceilings or the south walls as it can bring negative energies.

*Window panes and doors made of glass also act as mirrors. Cover them with curtains to avoid any ill effects.

*Mirrors should not be positioned opposite to one another which can cause restlessness, impatience or anger.

Also Read: Vastu Tips For Choosing The Right Apartment

Applying these simple Vastu tips in proper placement of mirrors in your home can bring in immense positive energy, greater wealth and good health.

 

Documents To Check, To Avoid Property Fraud

With our lifetime savings, we all plan to buy our dream home. While the cost of the property and the means to fund it are important, it is equally critical that you don’t end up becoming the victim of a fraud. Hence, it is essential to know which documents need to be checked when you buy a property.

Sale deed

This is the core legal document, a proof of sale as well as the transfer of ownership from the seller to you. A sale deed should be registered, apart from ensuring that the property has a clear title.

Also Read: How Sale Deed Is Executed

Mother deed

This is the parent legal document which helps trace the antecedent ownership of the property. You will need this document to sell your property in future. One has to ensure that the mother deed has recorded the references to previous ownerships in a continuing sequence until the current owner.

Approval plan of your building

A property owner must obtain an approval plan either from the jurisdictional commissioner or any other officer authorised by the commissioner. To obtain a building approval plan, one has to submit the following documents. These include:

Title deed

City/panchayat survey sketch

Latest tax receipts

Foundation certificate

Land-use certificate

Property assessment extract

Property PID number

Earlier sanctioned plans

Drawings of the property

Conversion certificate

As a large part of the land in India is still farmland. This is why revenue authorities issue a conversion certificate, stating the change in land use from agricultural to housing. A no-objection certificate should be obtained from the tehsildar’s office for this conversion.

Encumbrance certificate

This means a change in the ownership on property that has been held against a home loan. In other words, this document will give you proof of mortgages, title transfers or any legally registered transaction against your property.

Power of attorney

A power of attorney is a document that legally given authority to an individual to rent or mortgage the property on his behalf. But, this document, too, should be registered.

Also Read: Property Sale Through GPA Is Illegal

Tax receipts

Take a detailed look at all the receipts to ensure that taxes have been paid until the date of sale. Ask for the latest original receipts in order to establish the credentials of the owner. If your seller does not have the tax receipts, you can contact the municipal body by using survey number of the property in order to confirm the ownership. Other regular bills such as water and electricity bills should also be checked.

Completion certificate

A completion certificate by municipal authorities states that a building is in compliance with the rules and is built according to approved plans.

Occupancy certificate

To ensure that the building is meeting all the required norms, an inspection will be performed by the authorities when the developer applies for this certificate. In a nutshell, the certificate certifies that the project is ready for occupancy.

It is important to hire a lawyer who will vet all these documents and guide you through the process.

Also Read: Must Know Facts About Possession Letter And Occupancy Certificate

How Property Rights Of HUF Members Are Limited

It is painful to see a large chunk of your income go as taxes. You try every trick in the book to save much as possible. Among the many popular tax-saving exercises is the formation of a Hindu Undivided Family (HUF) by people belonging to the faiths of Hinduism, Sikhism, Jainism and Buddhism.

Before we move forward let us quickly understand what an HUF is. An HUF consists of a common ancestor and all of his lineal male children together with their spouses and spinster daughters. This means Ram, his wife Sita, their unmarried daughter Rama, their married son Rahul and his wife Rajni can together form an HUF. Rama would become a part of the HUF of her husband’s family once she gets married. At the same time, she would remain part of her father’s HUF.

Because an HUF is taxed separately from its members, it can claim deductions and exemptions under various sections of the Income Tax Act. As a combined entity, member benefits greatly if the HUF is registered and reports its income as a separate taxpayer. In fact, members will find banks more welcoming in case they are approached for a home loan, etc.

However, members an HUF also have to face certain restrictions.

Your share is constantly diluting

Each member has an equal right to the property owned by an HUF. This means the said property cannot be sold without having each member of the family on board.  New members that get added to the family by way of birth or marriage also have an equal share in the property. In fact, even an unborn child, who is still in the womb of its mother, has a right to the property.

This means the share of the existing members keeps diluting with new additions. While all goes well till there are no disagreements among members, matters might go out of hand in case of any discontent arises. By its very nature, an HUF is an ever-increasing entity as new members keep getting added. In such a scenario, managing the family and its finances might get quite complex.

Separation may turn ugly

In case there is disagreement among the members of an HUF and they decide to part way, they will have to dissolve the entity through a legal process known as a partition. Cases lying with courts across India testify partition process often goes ugly.

It must be noted here that once an HUF is formed it has to keep filing income tax returns until the time it is partitioned. When an HUF is dissolved, assets held by it are sold to be equally divided among all members. Now, each member will have to pay taxes on the profit thus made; the law perceives this gain as their individual income. Even if a new HUF is formed by married people who have exited the previous HUF, the income of the property would be taxed in the hands of new HUF.

Her dilemma

Property owned by women members is known as stridhan (the property of a woman), and income from it is not taxable as income of an HUF. This also means women members of an HUF cannot combine their separate assets with the property of the joint family. However, they can gift their property to the HUF.