Re: Is there a way to make taxation even more complex?
by vuyyala nagesh on Dec 09, 2009 10:30 AM
I totally agree with you. if 5% of this exercise is made only on the big industrialists & politicians, then we dont need to ask for loans from world bank, IMF etc.
One thing I don't understand is why banks charge pre-payment penalty on the remaining PRINCIPAL. Shouldn't they be charging it on the remaining INTEREST? Let's say, the bank has already picked up the interest and is now collecting only the principal. The party tries to pre-pay the principal. The bank should be happy that what was supposed to be collected in several months is coming right in. Right?
Re: Re: Hmm
by Komandur Kannan on Dec 08, 2009 03:28 PM
it is like this. I lend you rs.1,000 for which you have to pay about rs.10/month as interest and you have told me that you will take 5 years to repay this loan. If you settle this within a year - I lose potential income by way of interest which if I had given to someone who would probably give me the income - at the end of the day Banking is also a business which has to generate income. It is an industry which has to feed so many people and so many defaulters.
BTW, I am in no way related to this industry - just playing the devil's advocate; that's all.
Re: Re: Re: Hmm
by Almighty on Dec 12, 2009 11:13 AM
kannan is partly right, bank charges pre-payment penalty for early closure to recover marketing cost of loan, which is not fully charged when u take the loan.
so it is recovered later and also used to discourage borrowers from changing over to another lender.
But its the high interest rate that really bites borrowers most.
Re: Re: Re: Re: Hmm
by Almighty on Dec 12, 2009 11:15 AM
I recently changed from my banks interest rate of 11.5% to 7.5% from a Non Banking Finance Corp using one of my contacts. I'll be saving over 14.6 lacs over the next 15 years by changing over to N B F C. I can now save and invest this amount to earn more or repay the loan 35% faster than before. why work longer to make the bank richer at your cost ?
If_interested in_lower_interest u too_can_contact rohit_(0)_nine_nine_eight_zero_eight_zero_seven_one_six_four
One thing I don't understand is why banks charge pre-payment penalty on the remaining PRINCIPAL. Shouldn't they be charging it on the remaining INTEREST? Let's say, the bank has already picked up the interest and is now collecting only the principal. The party tries to pre-pay the principal. The bank should be happy that what was supposed to be collected in several months is coming right in. Right?
