I have applied for an auto loan. The verification executive insisted that he needs to talk to my neighbours and take their details as well. It was quite shocking to hear such requests when my credit score is above 800 and I have not missed a single repayment on my equated monthly instalments ever. Are such practices necessary?
Field Verification, as this process is known as, is a standard practice and is adapted by almost all Financial institutions (NBFC & Banks) as a pre-cursor to the loan. This is an independent verification and that too irrespective of the credit score. Some financiers / Banks insist on neighborhood check and the criterion followed is different for various NBFCs / Banks.
My NRI nephew working in Saudi Arabia has following queries. Is it mandatory to deposit his Indian income such as interest on FD, dividend on equity shares/MF, capital gains etc in NRO account only ?
Yes, it is mandatory to deposit his Indian income as stated above in NRO account. However, if these investments have been made after he became an NRI, then income earned on these investments can be transferred from NRO to NRE after submission of CA Certificate and Form 15 CA/CB (certifying that applicable taxes have been paid), subject to a limit of $1 million per year.
Income earned by a NRI customer in India cannot be deposited in ordinary savings (Resident) bank account as it would lead to breach of RBI guidelines and taxation laws and therefore illegal. On becoming an NRI, FEMA (Foreign Exchange Management Act) regulations require the individual to inform, within a reasonable time, all banks, where they have a Resident account, whether savings or fixed deposit, about the change in their status. The banks will redesignate the accounts as NRO. Thereafter all income generated / earned in India will be deposited into the NRO account. This NRO account can be used the same way as one used the Resident account before becoming an NRI.
I have a transaction of Rs 80,000 on my credit card. Can I repay part of it and convert the remaining amount into EMI?
Banks usually do not allow customers the option of a partial conversion of a particular transaction into an EMI. However, the customer can make a part payment of the total billed amount using Balance Conversion into EMI which is offered selectively to customers based on internal assessment. As part of the program, the customer needs to pay at least the Minimum Amount Due and request for the remaining amount to be converted into EMIs.
While applying for home loan, the agent from the bank said I should mention all my assets like insurance policy, FDs and even the value of my bike to increase the chances of getting the loan. Is this correct? If so, can I include the value of my wife’s jewellery as part of the assets?
Financial Institutions provide customers the option of sharing details with regards to their investments and assets. This is because higher financial assets represent a better repayment ability for the customer and hence the financial institution is able to make a better informed decision. Applicants can also declare assets belonging to their spouse if they are a co-borrower in the loan.
The views expressed are the expert’s own. Send your queries to yourmoney@bsmail.in
