web stats
Facebook Instagram Linkedin Twitter
Home Authors Posts by Bhanu Sahu

Bhanu Sahu

Bhanu Sahu
238 POSTS 0 COMMENTS
https://www.ipropunited.com
Talks about real estate and finance. Besides this, he is an eternal optimist , he loves to explore new heights and worships nature.
Linkedin

What is Return on Investment (ROI) and how to calculate it?

By
Bhanu Sahu
-

Understanding Return on Investment (ROI)

Return on investment (ROI) is a measure used to estimate the efficiency or profitability of an investment or compare the efficiency of several different investments. ROI approaches directly measure the amount of return on a particular investment relative to the investment’s cost. 

The return on an investment is divided by the cost of the investment to calculate ROI. The result is expressed as a percentage or a ratio. 

How to calculate ROI?

To calculate ROI, divide the difference between the current value of the investment and the cost of the investment by the cost of the investment. 

“Current value of investment” refers to the profits obtained from the sale of the investment of interest. ROI is easily comparable to other investment returns because it is measured as a percentage, allowing a variety of investment types to be compared. 

The calculation itself is not overly complicated, and it is relatively simple to interpret given its wide range of applications. If the ROI on investment is net positive, it is probably worthwhile. However, if other opportunities with higher ROIs are available, these signals can assist investors in eliminating or selecting the best options. Besides, investors should avoid negative ROIs, which imply a net loss.

For instance, suppose A invested Rs 1,000 in Slice Pizza Corp. in 2017 and sold the shares one year later for a total of Rs 1200. Now, divide the net profits (Rs 1200 minus Rs 1000) by the investment cost (Rs 1,000) to calculate an ROI of 20%. 

This information will give you an idea to compare the investment in Slice Pizza with any other projects. Suppose A also invested Rs 2000 in Big Sale Stores Inc. in 2015 and sold the share for a total of Rs 2,800 in 2018. The ROI on A’s holdings in the big sale would be 40%. 

Limitations of ROI

The above example reveals the limitations of using ROI, particularly when comparing investments. While A’s ROI was double that of the first investment, the time between purchase and sale in the first and second investments was one year and three years, respectively. 

A could adjust the ROI of the multi-year investment accordingly. One could divide the entire 40% by three to obtain the average annual ROI, which is 13.33% annualized. These adjustments show that the second investment earned more profit, while the first investment was a wise decision. 

ROI can be used in conjunction with the rate of return (RoR), which considers a project’s time frame. You can also use net present value (NPV), which accounts for differences in the value of money over time due to inflation. The application of NPV when calculating the RoR is often called the real rate of return.

ROI developments

SROI was created in the late 1990s to account for the broader impacts of projects using extra-financial value (i.e., social and environmental metrics not currently reflected in conventional financial accounts). Lately, investors and businesses have shown their interest in the development of new forms of ROI, called SROI, or “social return on investment.”

SROI helps to understand the value proposition of certain environmental, social, and governance (ESG) criteria used in socially responsible investing (SRI) practices.

For example, a company may want to recycle water in its factories and replace all its lighting with LED bulbs. These tasks have an immediate cost that may have a negative impact on the traditional ROI. However, the net benefit to society and the environment could lead to a positive SROI. 

Some other new variations of ROIs have been developed for specific purposes. The efficiency of social media campaigns is determined by the social media ROI, which shows the number of clicks or likes achieved per unit of effort. Similarly, the return attributable to advertising or marketing campaigns is determined by the marketing statistic ROI. 

Understanding ROI in simple terms

ROI (return on investment) tells you how much money you’ve made (or lost) on an investment or project after accounting for its cost.

How to Calculate Return on Investment (ROI)?

Return on Investment (ROI) is obtained by dividing the gained profit on an investment by the cost of that investment. For instance, an investment with a profit of Rs 100 and a cost of Rs 100 would have an ROI of 1 or 100% when expressed as a percentage. However, ROI is a quick and easy way to estimate the success of an investment, but it has some significant limitations. For instance, ROI is unable to reflect the time value of money, and it can be hard to meaningfully compare ROIs as some investments will take longer to generate a profit than others. Due to this reason, other metrics such as net present value (NPV) or the internal rate of return (IRR) are being used by professional investors. 

What Is a Good Return on Investment?

The “good” ROI depends on several variables, including the investor’s risk tolerance and the length of time it takes for an investment to start paying off. If everything is equal, more risk-averse investors will probably accept lower ROIs in exchange for taking less risk. Moreover, investments that take longer to pay off will generally require a higher ROI to be attractive to investors. 

What Industries Have the Highest ROI?

Altogether the average ROI for the index S&P 500 has been about 10% per year. However, depending on the industry, there can be significant variation within that. For instance, many technology companies produce annual returns above this 10% threshold. Meanwhile, companies in other industries, such as energy companies and utilities, made much lower ROIs and in several cases faced losses year over year. Gradually, it is normal for the average ROI of an industry to shift due to factors such as increased competition, technological changes, and shifts in consumer preferences.

Follow and Connect with us: Twitter, Facebook, Linkedin, Instagram

Understanding TDS on Property Sales: What You Need to Know

By
Bhanu Sahu
-

What does 194-IA of the Income Tax entail? 

According to Section 194-IA of the Income-Tax Act, a buyer must deduct and submit 1% of the transaction cost as TDS if the property is worth more than Rs 50 lakh. Contrarily, Section 194-IA does not specify which sum should be used to compute TDS on real estate sales when the stamp duty value and the actual selling price of the property differ.

The government-established circular rates, which are used to determine stamp duty on the transaction, cannot be used to register a property. The market value of the property could be higher or lower than the amount of stamp duty. In such a case, the buyer would have to determine TDS on the property sale based on the higher valuation, per the notification from February 1, 2022.

The Act’s Section 194-IA permits the tax on payments made in connection with the transfer of certain types of movable property other than agricultural land to be deducted. Any person responsible for paying to a resident any sum as consideration for the transfer of any immovable property (other than agricultural land) is allowed by subsection (1) of the said section to deduct tax at the rate of 1% of such sum as income-tax thereon at the time of crediting or paying such a sum to the resident. The Memorandum to the Budget 2022 states that when the consideration for the transfer of immovable property is less than Rs 50 lakh, no tax deduction shall be provided under Subsection (2).

Deduction of TDS

“TDS is to be deducted on the sum paid by the transferee to the transferor in accordance with the terms of the aforementioned section.” The stamp duty value of the immovable property is not taken into account in this section, but Sections 43CA and 50C of the Act mandate that it be used when calculating income under the headings “earnings and gains from business or profession” and “capital gains,” respectively. Thus, the provisions of Section 194-IA, as well as Sections 43CA and 50C of the Act, are in conflict,” it continues.

The document continues, “To remove inconsistency, it is proposed to amend Section 194-IA of the Act to provide that, in the case of transfer of an immovable property (other than agricultural land), TDS is to be deducted at the rate of 1% of such sum paid or credited to the resident or the stamp duty value of such property, whichever is greater.

If the consideration paid for the transfer of immovable property and the stamp duty value of that property are both less than Rs 50 lakh, Section 194-IA exempts the transfer from tax deduction requirements.

What is TDS and who is responsible for deducting it?

The government of India passed legislation requiring the buyer of a property to deduct tax at source when paying the seller for his property in order to combat the pervasive use of unaccounted money in immovable property transactions. Tax deducted at source, or TDS, was introduced with the intention of collecting tax right where the money came from.

A person (deductor) who is required to make a specific payment to another person (deductee) is required by law to withhold tax at the source and remit it to the federal government.  In actuality, this implies that it is the buyer’s responsibility to withhold TDS from property transfers. Using Form 26AS or a TDS certificate provided by the buyer, the seller, whose income has had tax deducted at source, is entitled to a credit for the amount deducted.

There will be a penalty imposed on the parties to the transaction if they don’t fulfill this obligation. The buyer could face criminal charges if he doesn’t deduct the required TDS and report it to the authorities.

How should TDS be paid and when should it be deducted?

If an advance is received before the execution of the conveyance deed, the TDS must be withheld either at the time the conveyance deed is executed or when the advance is paid. The purchaser has 30 days from the end of the month in which the tax is deducted to deposit the TDS amount to the credit of the central government. To pay the TDS and provide additional information, you must complete Form-cum-challan No. 26QB. You must fill out a separate Form 26QB for each pair of buyers and sellers if there are several interested parties or sellers for a given property. All buyers’ and sellers’ information must be included on each Form 26QB.

TDS: Important factors for the purchaser

  • Subtract 1% or 0.75% TDS, depending on the date of payment, from the selling price.
  • Get the seller’s PAN and cross-check it with the original PAN card.
  • You’ll also need your PAN to pay TDS.
  • Avoid any errors while filling the PAN or other details in the online form.
  • To resolve the situation, you must contact the Income Tax Department. 

The most crucial aspects of TDS to understand

  • Buyers of property worth more than Rs 50 lakhs are required to deduct and pay TDS to the government.
  • Only the purchasers are responsible for deducting and submitting TDS.
  • The buyer will be responsible to the authorities in the event of any misappropriation. Buyers must submit Form 26QB in order to credit TDS.
  • If there are multiple buyers or sellers, separate forms must be filled out for each party.

Follow and Connect with us: Twitter, Facebook, Linkedin, Instagram

Make Your Bedroom a Haven: Expert-Recommended Paint Color Ideas

By
Bhanu Sahu
-

You begin your morning in the bedroom, and you end it there. Therefore, the bedroom paint colors you select can have a big impact on how much you can relax and decompress there. On the other hand, you might end up with a room that looks dark, dingy, or cramped if you make the wrong color choice for your bedroom.

This is due to the fact that bedroom paint colors have the power to evoke favorable emotions and can make your room hospitable, cozy, and cheerful. If not carefully chosen, they can also have the opposite effect. But don’t worry! We’ve put together a list of the best color combinations for your bedroom to help you make the best decision.

Coastal-Inspired Color

If you can’t decide on a color for your bedroom walls, choose different shades of the same color. This is known as tone-on-tone. A beachy effect and a charming atmosphere can be achieved by painting bedrooms in a variety of blue tones. Make the room appear brighter by painting the walls with lighter colors to reflect light.

Classic Scandinavian Approach

The best choice for Scandinavian-style bedroom paint colors is a mix of white and wood. Neutral bedroom paints, like white, work well in small rooms but add a touch of coziness by pairing the color with wood accents. The natural tone of wood invites in the outside and creates a warm atmosphere. This is one of the best color schemes for bedrooms to promote restful sleep.

White with a Bright Pop

White with a bright pop is a fantastic idea if you’re looking for some of the best bedroom color options. Small spaces can be quite constrained in their use of color because, if poorly designed, they can feel cluttered and chaotic. The best course of action is to choose white bedroom color schemes with colorful accents in headboards, pillowcases, decor, and other items. These vibrant bedroom paint colors add life to the space.

Neutral Colors for Bedrooms

Looking for alternatives to white for the color of your bedroom? Try layering with neutral, muted hues. Complementary color schemes for rooms that look great together include white, beige, peach, and cream. The addition of light colors that brighten the room also gives it a classy appearance.

Bold blue for bedroom walls

Blue is the best color choice for bedrooms if you want to create a soothing and easy-on-the-eyes atmosphere. The color will make you think of the ocean and the sky, and it can be used to easily match various bedroom design themes. 

Blush Pink for a romantic bedroom

Blush pink is a beautiful and relaxing choice for bedroom wall painting ideas. You can make this work by including it on an accent wall or by using it on various pieces of furniture. Bedroom paint colors like pink don’t necessarily have to be gender-specific, despite popular belief. They look fantastic in every design theme.

Coral color for relaxing Bedroom

Coral color is a distinctive shade of soft pink and orange that can make your bedroom feel relaxing. Making an accent wall out of this color and keeping the other walls neutral is the best way to use it.

Beige color ideas for bedroom

Personal preference determines the best color for bedroom walls. However, if you’re wondering what color goes well with every bedroom design, beige is the answer. While being less difficult to maintain than white, the beige bedroom paint color gives your room a tasteful sophistication.

White and Grey combination

Grey paint for the bedroom can help you create the right atmosphere when paired with white. The combination can create the illusion of more space in small bedrooms. Make sure to choose the appropriate texture and shade of grey for small bedrooms, though.

Terracota for a warm bedroom

Terracotta is a fantastic option if you’re searching for the best bedroom color option. Terracotta is a unique color that can look stunning when used in layers as a bedroom paint color. Your bedroom can look cozy and inviting with this unique color. 

Blue and yellow color combination

This room color combination of midnight blue and canary yellow brings the space to life by creating a cheerful mood. With a smattering of white furnishings in the design, the designers have balanced the vibe. Yellow bedroom paint colors can lift one’s spirits, whereas blue is associated with tranquillity and peaceful sleep. 

Pastel wall paintings

Try choosing a pastel color if you want a bedroom paint color that looks like it belongs in a Disney movie. You can transform it into a setting straight out of a fairy tale by adding sheer curtains, big headboards, and a canopy bed.  

Pale Greige for contemporary bedroom

Not sure whether to go with beige or grey? Choose both! This unique shade, also known as ‘greige,’ is one of the best bedroom colors for modern bedrooms. Play around with softly colored furniture in your space, such as light pink and blue, to prevent it from looking boring.

All-white for bedroom

White is a traditional choice when it comes to evergreen bedroom paint colors. White is the one color that looks great in every setting, no matter how big or small the space. Choose a room with all-white furnishings, like this one, if elegance is the look you’re going for.

Ochre and white colors for a cozy bedroom

A centerpiece is essential in large bedrooms to give them a theme. And if it’s difficult for you to choose just one color for your bedroom walls, consider using a color scheme instead. Ochre and white are excellent for making a room more cheerful and eye-catching. These bedroom paint colors look lovely when used as an accent wall or when scattered throughout the furniture.

Top Vastu Colors for Your Bedroom

Are you curious what Vastu Shastra has to say about the colors of a bedroom? You can use the table below as a guide:

Colour

What It Stands For

Blue

Serenity

Green

Healing, growth and abundance

Yellow

Happiness and positivity

Purple

Wealth, self-respect and poise

The Significance of Color Combinations?

The right wall color combination is critical because it sets the atmosphere for your bedroom. Furthermore, colors can make your room appear more spacious, airy, or warm, depending on your preferences. Last but not least, since painting is typically a long-term investment, you’d want to be sure to make the right choice and not look back on it.

How to decide on the colors for the bedroom?

You must first decide on the look you want to achieve and the colors you like before selecting the bedroom paint color. While selecting a color, keep in mind the size of your room.

The color combination of the bedroom can make or break the design of the space. The secret is to use a combination of bold and striking colors for larger rooms, bright, cheery colors for small bedrooms, and a light color scheme for medium-sized bedrooms.

Follow and Connect with us: Twitter, Facebook, Linkedin, Instagram

Short Term Investments: Best Options for 2024

By
Bhanu Sahu
-

During a period of three to twelve months, short-term investments can be converted into cash. High-yield savings accounts, money market accounts, Treasury bills, and government bonds are some of the most popular short-term investments. All of these are reliable products with highly liquid assets.

What are Short Term investments?

Investments made in the short term are intended to yield sizeable profits in a time as short as a year or a few months. These programs are primarily concentrated on covering the anticipated short-term expenses.

Most often, investors who favor short-term investments aren’t very interested in waiting years to see their money multiply several times over. They want rapid and efficient outcomes instead. Plans for short-term investment can save them in this situation.

One can anticipate the best return possible with short-term investment plans to help them achieve their financial goals, but not the kind of significant returns possible with long-term investment possibilities. Short-term investment plans frequently top the popularity lists of seasoned investors due to the decreased risks they carry. 

Short Term Investments Options

Below are some of the best short-term investment options in 2024. 

Recurring Deposit 

Tenure: One may open an RD account for a term of no more than 6 months and no more than 3-month increments up to 10 years. 

Liquidity: A recurrent deposit system typically has a minimum lock-in duration of one month. Only the principal amount and no interest are provided to the depositors if the account is prematurely closed within one month. 

Returns: One of the best short-term investment plans is the recurring deposit account, which offers the same interest rate as bank FDs. Currently, the interest rate for a tenure of up to 12 months is 6.5% per year. The interest will take effect as of the initial deposition date.

Taxation: The interest on an investment is added to the investor’s income and taxed at the applicable income slab rate. If the interest earned exceeds Rs. 10,000 in these short-term investment plans, TDS is subtracted.

Money Market Accounts 

Money market accounts, also known as liquid funds, are an excellent option for short-term investments because they are made to provide you with capital security and respectable returns. These mutual funds have the lowest risk among all of them and the most liquidity because of their 91-day maturity time restriction. They also don’t have any lock-in periods. 

Tenure: A money market account may be opened for a duration of fewer than 13 months. 

Liquidity: High liquidity and speedy redemption are provided by this short-term investment plan choice. 

Returns: Money market fund returns are neither guaranteed nor fixed. MMF currently provides a 7% annual interest rate. Investors should invest after matching their investment horizon to the maturities of the other investment securities in these funds to achieve the best results. 

Taxation: in this short-term investment plan, the profit made on the amount invested is added to the investor’s income and taxed as such. The post-indexation tax rate for profits made on investments made for longer than 36 months is 20%. 

Debt Instruments

Another excellent short-term investment option is debt instruments, particularly for those who are risk-averse. Debt mutual funds are a wonderful area to invest in since they secure capital and deliver positive rewards without worrying about market volatility. This is a solid option for short-term investment because it offers returns of up to 10.5%. 

Short-term investment plan debt funds are classified into three types based on tenure. 

Liquid fund: With this fund choice, investments are made in debt and money market securities with maturities of up to 91 days. 

Ultra-short-duration fund: The money is invested in debt and money market securities for 3 to 6 months under the ultra-short-duration fund option. 

Short-duration fund: Under this fund choice, funds are invested for 6-12 months in debt and money market securities. 

Liquidity: High liquidity is offered by liquid debt funds for investing. In comparison to a savings account, the liquid debt fund offers a maximum maturity of 91 days and gives better yields. 

Returns: Debt funds are registered as one of the greatest short-term investment strategies since they provide investors with steady returns at minimal risk. Debt funds currently offer an investment interest rate of 7-9

Taxation: Debt funds are subject to capital gains tax. The capital gains made on a fund that is held for a minimum of three years are subject to short-term capital gains tax (STCG). On capital gains made on a fund that has been held for a while greater than three years, long-term capital gain tax is applied.

Fixed Deposits in Banks

Fixed deposits, often known as short-term investments or savings instruments, allow a person to deposit a large sum of money into the bank for a predetermined amount of time. One of the safest short-term investing options is the fixed deposit or certificate of deposit scheme, which offers a fixed FD interest rate on investments and guarantees returns.

Tenure: Fixed deposit accounts have terms ranging from 7 days to 10 years, making them one of the safest short-term investment options. On maturity, the deposits can be renewed and reinvested. 

Liquidity: The fixed deposit program manages reinvestment risk in addition to providing high investment liquidity. 

Returns: At the end of the fund’s duration, returns on fixed deposit accounts are assured and come with a fixed interest rate. Fixed deposit interest rates currently range from 8% to 9% for investments lasting more than a year. Even in the event of market volatility, the interest rate on fixed deposit programs remains constant. 

Taxation: Depending on the head of income the individual falls under, FD attracts a high-income tax rate of up to 30%. The accrued interest is used to calculate the tax as well. Investors cannot deduct any taxes from fixed deposits.

Post Office Time Deposit 

One of the best and safest short-term investment strategies that provides investors with guaranteed returns is post-office time deposits, commonly referred to as post-office fixed deposits. The program is provided by India Post and is particularly well-liked in India’s rural and outlying regions.

Duration: A post office time deposit account may be opened for one year, two years, three years, or five years.

Liquidity: Under the post office program, the interest charged on the deposited sum is calculated annually. The post office program prohibits any early withdrawal before the end of the six months.

Returns: The following Post Office FD return rate is available for time deposit accounts.

Tenure of the Account Applicable Interest Rate
1 year account 5.5% 
2 year account 5.5% 
3 years account 5.5% 
5 years account 6.7%

Taxation: The interest on the amount deposited is added to the depositor’s income and taxed at the appropriate income tax rate for that individual’s tax slab.

Large Cap Mutual Funds 

Large-cap mutual funds are short-term investment plans that invest judiciously in the stocks of major corporations to see significant growth in a shorter amount of time. Within one to three years of the investment period, these fantastic little investment programs might provide you with prompt and wise returns.

Tenure: A person may invest in a large-cap mutual fund for a period of three to five years.

Liquidity: The large-cap mutual fund scheme provides investors with significant liquidity in addition to substantial profits on their investments.

Returns: Large-cap mutual funds are a safe short-term investment option with low risk and a high return of 8%–13%.

Taxation: Debt funds are subject to capital gains tax. The capital gains made on a fund that is held for a minimum of three years are subject to short-term capital gains tax (STCG). On capital gains made on a fund that has been held for a while greater than three years, long-term capital gain tax is applied. 

Silver or Gold 

Gold and silver are beneficial for both long-term and short-term investments, much like the ever-growing trees of an investment forest. With the daily increase in the price of gold and silver, these investment schemes are guaranteed to yield enormous returns. So, you must invest in gold or silver if you want safe and risk-free short-term investment plans and beyond. Keep in mind that these metals’ luster won’t disappear. 

Treasury Securities 

Treasury securities or Treasury bills are another excellent short-term investment plan that provides great liquidity, safety, and a gratifying return. Their maturation times range between 91 and 365 days.

Stock Market/derivatives 

Those with strong market knowledge and a high tolerance for risk can consider investing in shares, commodities, and derivatives. If an investor requires a quick return on investment, he may choose to make a short-term investment.

Investing in corporate or company deposits or NCDs

The last minor investment plan on our list is a corporate deposit, often known as an NCD. You can choose a secured NCD (non-convertible debt) to secure your capital through this scheme. Also, it provides enticing interest rates that range from 9% to 12%.

How Short Term Investment Works?

The balance sheets of businesses with high cash flows include accounts for short-term investments. As they invest excess funds in bonds, equities, or other investments to earn a greater income. Short-term investment plans provide capital protection while generating strong returns on investment.

Requirements for Short-Term Investments

Any investment that satisfies these two fundamental criteria is said to be a short-term investment. First, it offers liquidity, and second, the investment must be made for 12 months. A bond with a set maturity date falls under the category of a short-term investment strategy. Marketable equity assets may be easily traded as a liquid fund, and are regarded as short-term investments. The chosen maturity period for short-term investment plans is less than a year.

Follow and Connect with us: Twitter, Facebook, Linkedin, Instagram

What to choose: Term Insurance or Home Loan insurance

By
Bhanu Sahu
-

Insurance is a crucial financial instrument that supports individuals in securing their family’s future. Home loan insurance and term insurance are both important forms of insurance. Even though home loan insurance has certain benefits, experts suggest that term insurance can be a more cost-effective alternative.

Term insurance and home loan insurance are different types of insurance for home mortgages. Let’s first understand how home loan insurance helps you in challenging circumstances.

Home Loan Insurance  

The uncertainty of life necessitates that home loan borrowers make loans insured against contingencies such as death, disability, disease, and unemployment. It enables the borrower or his family to pay back the outstanding loan balance even under difficult circumstances and keep their home. Additionally, insurance coverage provides tax advantages under certain conditions. 

Wishfin CEO, Rishi Mehra, agrees with the idea of having a cover for your liabilities, such as a home loan. 

What is term insurance?

Term insurance is the cheapest form of life insurance, which allows the dependents of the insured person to pay a lump sum in case of his death. One can extend such insurance policies to include illness as well. Experts said that a term insurance plan can cover all liabilities, including the home loan. Instead of buying a separate home loan insurance policy, the coverage can be increased at the time of buying a home loan if the insurance coverage is insufficient. 

It is crucial to understand that home loan insurance and home insurance are two different things. Home insurance ideally covers either your building and the belongings inside your house or both, depending on the policy. However, home loan insurance is similar to a life or term insurance policy. The only difference is that as the loan tenure goes forward, the cover amount keeps reducing. For example, assume that you take a Rs 2 crore loan today and a Rs 2 crore home insurance.

In this case, your life is covered by Rs 2 crore, but this amount will be reduced every year as you pay the EMI. In the event of the death of the policyholder, the insurance company will pay the bank whatever the sum assured for that year is. If it is higher, the remaining amount is paid to the nominee, or if it is lower, then the nominee has to pay the remaining amount. 

Key features of term insurance 

Period

The tenure of term insurance policies varies from five to 25 years and can be extended for a lifetime. 

Tax benefits

Term insurance enjoys tax benefits under Section 80(C), 10(10D), and in certain cases, under Section 80D as well.

Age criteria

The minimum age requirement for term insurance is 18 years, and the maximum age limit is 65 years. An optional add-on benefit can be availed of at your convenience.

Survival/maturity benefits

A standard-term insurance plan does not provide any survival or maturity benefits. Those looking for the same can opt for Term Return of Premium (TROP) plans. 

Term insurance vs Home Loan Insurance

  • Compared to home loan insurance for the same sum assured, term plans are reasonable.
  • Home loan insurance plans are generally packaged with the mortgage. You won’t be able to compare the policy being given with others in the market because banks frequently tie up with particular insurance providers. Meanwhile, term insurance can be purchased separately in the open market after comparing the services offered by all insurance companies.
  • Banks might not allow you to pay for the insurance separately in the case of home loan insurance. The premium tends to raise the Equated Monthly Instalments because it is generally included in the amount paid toward the overall loan amount (EMI). In contrast to home loan insurance, term insurance premiums can be paid separately and do not incur interest.
  • As the debt is paid off, the coverage provided by home loan insurance is reduced. However, with a term plan, the insurance coverage is continuous and can help the borrower’s family in the event of an untimely death.
  • The borrower might lose the entire premium paid for loan insurance during the foreclosure of the home loan. But term plans are free of such risks and will constantly provide coverage even if a loan gets foreclosed. 
  • The term plan allows you to easily transfer your loan to another bank without losing the paid premium. In the case of home loan insurance, most policies expire on transfer to another bank, and you may lose the entire or part of the paid premium. 

In the event of the untimely death of the home loan borrower, term plans provide the entire covered amount to the dependents, which can be utilized for other purposes as well. However, a home loan insurance plan fetches death claims only equivalent to the loan amount.

Wrapping Up

If your liabilities only involve your mortgage loan, you can think about purchasing home loan insurance because the sum assured decreases with the reduction of the outstanding loan. However, once a term plan is bought, it covers a certain amount for a fixed time with a constant premium.”. Additionally, it covers critical illnesses in addition to life insurance. While many people purchase home loan insurance when purchasing a new house, term plans can also be quite advantageous. 

Follow and Connect with us: Twitter, Facebook, Linkedin, Instagram

5 Common Home Decor Mistakes That Can Be Easily Avoided

By
Bhanu Sahu
-

IftopHome is where the heart is, and therefore, we try to make all possible efforts to make it look beautiful and impressive. Whether it is time or money, we invest a lot in designing our homes to get the look we have always desired. But what we forget is that even a small decorating mistake can spoil the entire effort. We are talking about very common home decor mistakes that most of us do and are not even aware of, which can blemish the appearance of your home.

We’ve compiled a list of common home decor mistakes that you can easily avoid to make sure your home looks flawless.

Here we go –

1. Stuffing bulky furniture in small rooms1 furniture in small roomsEverything has a place of its own and bulky furniture is a big No-No for small rooms. Bulky furniture can make your small room look even smaller and can make you feel suffocated and claustrophobic. Your guests will also feel as if they are not able to get fresh air and that is probably the last thing you want for your guests.
Solution: If you are looking for furniture pieces for a small room then look for light wood and colours that reflect light like white, beige or yellow.

2. Paintings and artworks that are out of vision2 paintingsIf you are buying expensive or antique artwork, then it is very important to flaunt it properly! There will be no point left if the painting is hanged too high or in a way which hides its beauty as it will kill the whole vibe of that artwork.
Solution: You must always make sure that the paintings or artwork is hanged at an eye-level to make them prominently displayed.

3. Buying rug that is inappropriate for the room3 large rug shouldYou may not have realized it but a rug plays a very significant role in your home décor. The right one can make an ever-lasting impression, while the wrong one can spoil the entire look. If the rugs are too large, they can overshadow everything else in the room. If the rugs are too small, they will muddle up the appearance.
Solution: A large rug should be bought for the living room or drawing room, while your bedside should have the smaller ones!

4. Forgetting a thing called ‘Scale’ exists!4 Forgetting a thing called ‘Scale’ existsWhen we are buying furniture for our homes, we tend to ignore the size of the furniture. We don’t consider it very important. If everything in your room is of the same size, then obviously your room will look plain and dull.
Solution: You must have a blend of shapes and sizes that complement each other perfectly and even enhance each other’s beauty.

5. Not giving importance to light5 experiment with different colours of lights tooWhat importance would everything in a room hold, if there is not proper lighting? Nothing! People generally forget to fill the room with lights.
Solution: Have various sources of lighting fixtures in a room instead of just one overhead light. You can experiment with different colors of lights too.

Follow and Connect with us: Twitter, Facebook, Linkedin, Instagram

Disadvantages of not making a rent agreement

By
Bhanu Sahu
-

A rental agreement is a contract or document that is signed by the renter and the owner of the property; it must be registered with the sub-registrar’s office to be legally enforceable, and it serves as sufficient evidence in court in the event of a dispute between the parties.

Sometimes, in order to save money and avoid the hassles of paperwork, the parties decide to go in for a verbal agreement or create an agreement but do not get it registered. A rent agreement is an important document, a legal contract that lists all the mutually agreed terms and conditions between the landlord and the tenant. They must pay a registration charge and be present at the sub-registrar’s office to complete paperwork and get the agreement registered.

Issues faced by owners and tenants

It is imperative to create a rent agreement, as it serves to protect the interests of both the tenant and landlord. Failure to do so may result in various issues that can be detrimental to both parties. 

Challenges for tenants involve: 

  • The landlord can ask them to vacate the property at any time or increase the rent at any point without prior notice. 
  • The absence of a rent agreement can render a tenant ineligible for tax exemption via HRA.
  • In the event of any dispute, a tenant may not have a legal basis to prove their case, as the rent agreement provides an admissible piece of evidence in court.

Similarly, landlords can also face various issues if a rent agreement is not created. 

  • In the event of any property damage, the landlord cannot force the tenant to pay for it. 
  • A tenant may vacate the property at any time, which can leave the landlord without a tenant until they find a new one. 
  • In the absence of an agreement that specifies the penalty amount in case of a payment default, the landlord cannot impose any fine on a tenant who defaults on paying rent on time. 

In the event of a dispute between the landlord and the tenant, a rent agreement provides a legal basis for both parties to present their case in court. Therefore, both landlords and tenants should create a rent agreement to safeguard their interests.

Critical points to consider before signing a rent agreement

A rental agreement is a legally binding document that becomes effective once it is signed and registered. It is imperative to exercise caution while signing a rental agreement. Some crucial points to consider before signing a rental agreement are as follows:

  • The tenant must visit the property and inspect it in person to ensure the construction quality and the state of the property.
  • It is important to verify that the electrical appliances, wiring, switchboards, plumbing fixtures, and water connections are all in good working condition. Any damages or repairs that are needed should be reported to the owner and addressed before moving in.
  • It is essential to thoroughly read and understand all the clauses listed in the rental agreement.
  • It is important to check the lease duration, which is typically for 11 months since any lease period exceeding 11 months needs to be registered.
  • The rental agreement should mention the due date for rent payment and the penalty in case of default. Additionally, it is important to verify whether the maintenance charges include the fees for the gym, parking, club, and swimming pool.
  • The agreement must specify the security deposit amount and how it will be adjusted when the lease period ends. It should also mention who will be responsible for the maintenance and repair of the property.
  • It is crucial to check whether the previous tenant has cleared all previous maintenance charges, utility bills, and other dues. It is also important to verify the sale deed and share certificate and obtain a no-objection certificate if the property is in a housing society.
  • The agreement must include a termination clause.

Is a verbal rental agreement legally binding?

When it comes to renting property, it’s important to understand the legalities of verbal agreements. Generally speaking, if the rental tenure is 11 months or less, a verbal agreement is legally binding as long as all terms and conditions are agreed upon by both parties. However, if the rental period is longer than one year, a verbal agreement will not be recognized by law, and a written agreement that is registered becomes necessary for legal validity.

It’s worth noting that a verbal agreement can be breached at any time, with either party able to break the terms. In the event of any dispute between a landlord and tenant, a written and registered rental agreement serves as admissible proof in court. 

Are online rent agreements valid?

As for online rental agreements, they are just as valid as traditional written agreements. It’s important to note, however, that only a registered agreement is legally binding and can properly safeguard the rights of both landlord and tenant in the event of a dispute. An online rental agreement can be considered an authentic document, but it should either be printed on stamp paper or have an e-stamp affixed on the front page to ensure its legal validity.

How to create a rental agreement online? 

To create a rental agreement online, begin by downloading the agreement template from an online platform. Customize the template with the necessary information including the tenant’s and landlord’s details, property address, and other terms and conditions. You may choose a lease agreement or a leave and license agreement based on your preference.

After reviewing the details, preview the agreement and make online payments. The payment includes the stamp duty charge, which varies from state to state, convenience and delivery charges, and relevant Goods and Services Tax (GST). Within three to five working days, the agreement will be printed on stamp paper and delivered to your doorstep. Alternatively, the online rental agreement with the e-stamp can be sent to your email.

There is an option to sign the contract digitally. Section 5 of the Information Technology Act, 2000, provides legal recognition to digital signatures. After making the payment, share the agreement with both parties and sign digitally. The rental agreement can be downloaded after both parties have signed it.

What if the rental agreement is not registered?

According to Section 17 of the Registration Act, a rental agreement between the landlord and tenant must be registered if the tenure of the agreement is for one year. If the rental period is less than 12 months, registering the agreement is optional.

It is mandatory to have a registered written rental agreement according to Section 4 of the Delhi Rent Control Act, 1995. If the agreement is not registered, the consequences of non-registration of a document under the Registration Act, 1908 shall follow.

In the event of a dispute between the landlord and tenant, the unregistered document will not be admissible as evidence, and the authority will not have any power to evict the tenant. The landlord will have to follow a lengthy process for eviction or get their dues cleared.

On the contrary, having a registered rental agreement minimizes conflict between the landlord and tenant. The terms and conditions are mutually agreed upon and listed in the agreement. It also serves as an address proof required for school admissions, bank loans, vehicle registrations, and other facilities. Moreover, it acts as an identity proof required for making documents such as pan card, passport, and others. One can claim House Rent Allowance (HRA) by submitting rent receipts and the rent agreement.

Can you get out of a rental agreement on a house?

The rental agreement should mention the termination clause too. As per the legal obligation, both the tenant and the owner need to abide by it. They should stick to the notice period mentioned in the termination clause and serve a written notice in case of early eviction.

In case the tenant wants to leave the house before the end of the lease term, he should pay the rent for the notice period too even if he’s not living in the rented property.

If the owner and the tenant mutually agree to end the contract, both of them can break the agreement without facing any penalty.

conclusion

Neglecting to create and register a rental agreement can lead to numerous challenges for both landlords and tenants. The absence of a formal agreement can result in tenants facing sudden eviction or rent increases without notice, while landlords may encounter difficulties in recovering damages or enforcing payment defaults. A properly drafted and registered rent agreement serves as a legal safeguard, providing a basis for resolving disputes and protecting the interests of both parties.

Follow and Connect with us: Twitter, Facebook, Linkedin, Instagram

Joint Ownership of Property: Tax and Loan Benefit

By
Bhanu Sahu
-

Joint Ownership of Property: Meaning   

Jointly owned property is any property that is held in the names of two or more parties. These parties may be spouses, business associates, or any other group of people who have a shared interest in owning property. When two parties own property together, it is considered to have matrimonial status. Jointly owned property can be held in a trust, joint tenancy, tenancy by the entirety, or community property.

Joint Ownership of Property: Benefits

Joint ownership of property has numerous benefits over property in single names, and to draw such benefits, one must be aware of them. Generally, every prospective buyer does diligent research on the kind of property he or she wants to buy, right from its pricing to the formalities and documents required for purchasing it. But many of us are not even aware of the benefits of buying property in joint names and what the property’s joint holders will receive.

Income Tax Benefits

This is very crucial in terms of income tax benefits. Such benefits could only be enjoyed by the holder of the property. For example, if you and your wife have joint ownership of property and both of you share the EMI payment, only your wife will be able to claim an income-tax rebate out of the EMI amount paid.

Joint Ownership Benefit

So far, there is no specific law that governs who can be added as a joint owner for a property to be in joint names. It can be anyone from close relatives like spouses, children, parents, brothers, or sisters to your friends or business partners. It is always recommended to buy a property in joint names rather than single names. If you are a bachelor, you can purchase it with your and your parent’s names as a property joint holder. If you are married, you can opt for your spouse or children as a joint owner. The property’s joint owners are not required to contribute towards the payment of the property.

Claiming Benefit

In case of any unforeseen mishap to either of the owners of the property, the property gets automatically transferred to the remaining joint holders. As apartments in housing societies are in huge demand under the residential properties segment, the societies generally transfer the flat in the name of the remaining joint holders without insisting on a no-objection certificate from other legal heirs to the remaining joint holder of the property in case of the death of any property holder that is jointly owned.

In the case of home loans as well, the lenders also insist on co-borrowers like close relatives, spouse, children, or parents so that, in the event of the death of any of the applicants, the liability could be fixed on the rest of the co-borrowers. Most of the lenders do not entertain loan applications in a single name.

Loan Benefit

This benefit can be easily drawn from joint properties. With the exorbitant prices, acquiring property necessitates a large loan, and rebates may only be claimed for income tax purposes by the property’s owner. The repayment of the principal amount derives tax benefits under Section 80C, and the interest amount gets a rebate under Section 24b. For example, if you take a loan of 50 lakhs for a residential property, the annual interest with an interest rate of 9.50% shall be calculated as 4.75 lakhs.

The Income Tax Act has levied a cap of Rs. 2 lakh per person that can be claimed for a rebate on account of interest for every financial year. In such a case, you shall be able to claim a maximum of up to Rs. 2 lakh, while if the property is joint-holding, then each holder can claim an amount of Rs. 2 lakh on account of interest. Similarly, the repayment of the principal amount can be claimed up to Rs. 1.5 lakh per annum under Section 80C.

Bottom Line 

So, if you purchase a property in joint names, each of the holders can claim 1.5 lakhs with the presumption that you don’t have any other expenditure or investment qualified under the aforesaid section.

Follow and Connect with us: Twitter, Facebook, Linkedin, Instagram

Home Decor Ideas To Add Quirky Touch To Your Home

By
Bhanu Sahu
-

quirky Ideas for home decorTo add a unique presentation to your home, adding a quirk touch to home decor is no longer taboo. After all, a home is a visual representation of its occupants. Hence, a vast range of quirky decor items are available on the market. A number of entrepreneurs, artists, and designers are held responsible for the creation of such stuff. An eyesore from the past can become great artisan decor stuff in the present by adding some artwork to it.

Hook on to Appropriate Accessory

In order to brighten up dull decor, a tinge of quirkiness is essential. The selection is tricky, but make sure to buy an artwork that has its own identity. Quirky can be humorous, shocking, playful, or curiosity-evoking, but it must be eye-catching. A coffee mug that looks like a cactus plant or an ashtray resembling Indian loos are some of the quirky art decor ideas.

Tips to Add a Quirky Decor Element to Your House

Photo Frames
assymtrical vintage of photo framesThe asymmetrical alignment of framed photographs in neon shades can add a fun element.

Waste Materials
wine bottles lampAn artistic twist to waste materials for home decor available within the house, including old furniture like an old wooden stool or an empty liquor bottle painted in some eye-catching colors, can work wonders.

Art on Wall
mannatA vibrant piece of street art over the wall with a brick finish catches instant attention.

Recycled Items
recycled bottlesAdd some of the recycled items for home decor, such as Bottles’ bases for planting purposes or old metal bucket taps as hooks, to add a quirky element.

Cushion Covers
cushion coverInspired by Indian traditional designs, this is a fun way to add a stunning Indian flavour to the decor of your house.

Make sure that the pieces of art that you use don’t look tacky or cheap.

These simple yet elegant ideas will definitely make your decor stand out from the rest. Don’t restrict your quirky decor to a few selected pieces. Extend them as much as possible with your creative ideas.

Follow and Connect with us: Twitter, Facebook, Linkedin, Instagram

Single Women Property Investment Suggestions

By
Bhanu Sahu
-

 

With a pool of offers and a list of properties, the perplexity of the situation is obvious, and hence, here are some suggestions for single women interested in real estate investment. With women becoming more and more independent in financial terms, it becomes a mandate for them to choose a suitable channel of investment, like that in real estate, to attain financial stability for a lifetime.  If you are a single woman, the following are the “extra” cautions that you must undertake to make your “symbol of independence” hassle-free in the long term:

 

Knowing your Budget
The first and foremost step in planning for investment in property is to diligently know your affordability, which includes expenditures on insurance, taxes, and overall maintenance of your property besides its EMIs. Don’t forget to save some liquidity for any kind of unforeseen circumstance to avoid last-minute pests.

Consulting Experts
Buying a property involves a huge monetary investment, and to lend it in safe hands, it is highly recommended to seek some expert advice on it. Nowadays, you can find expert consultants for each segment, and when it comes to making vital decisions, such as investing in real estate, the market has no shortage of experts for it. Extensive research shall be carried out before choosing a project for investment.

Security with Location
Before finalizing a property, you need to ensure that it is safe and secure with intensive research on its neighborhood. As a single woman, it is a mandate that basic amenities like hospitals, restaurants, markets, banks and ATMs, shopping complexes, and other recreational facilities be in the vicinity. The property must be equipped with security features that give you a sense of safety.

Insurance
To safeguard your investment from any unforeseen emergencies, don’t forget to shield it with insurance. Various companies in the market offer different insurance plans depending on your budget.

Size of your Property
After making up your mind about the kind of project you should invest in, the next crucial decision is to choose the size of property to invest in. Although it always gets limited by the budget factor, several other aspects will help you make a favorable decision. 1 BHK sounds perfect for a single woman, as it is not just cost-effective but easier to maintain in the long run as well. If you plan to get married or looking for a flatmate to share your maintenance expenses in the future, 2 BHK shall be a preferred choice.  Depending on your budget and requirements, you may also prioritize the projects based on the amenities they offer, like the gymnasium, clubhouse, jogging track, and many more.

With these measures, you will surely invest your hard-earned money in a win-win deal that will make you proud of your investment decision.

Follow and Connect with us: Twitter, Facebook, Linkedin, Instagram

1...789...24Page 8 of 24

Latest News

© Copyrights Reserved iPropUnited.com - A DNA Ventures Company