Switching to teaser Home Loan – Does it make sense?

I purchased a Residential property in Ranchi in June 2009 worth Rs. 20 lakhs taking a Home loan of Rs. 15.6 Lakh from LIC Housing Finance @ 8.75% p.a. for 12 years. A few days back I received a letter from LIC saying the rates have been increased to 10% effective November 2009. Due to this my tenure has increased by 18 months.

So with so much promotional teaser Home Loans going in the market, does it make sense for me to switch. I did some calculation for the same which I would be presenting in the post for your valuable comments and feedback.

Paying for your Dream Home - Upfront Payment or Construction Linked Installment Plan?

One of my friends had shortlisted his dream Home but was confused which payment plan to follow. There are usually three payment Plans. 

1. Upfront payment: You pay the builder around 95% of cost upfront with some discount & rest at the time of possession.
2. Construction Linked Installment Plan: You pay certain % of cost as the construction progresses.
3. Time Linked Installment Plan: You pay the builder at predetermined regular intervals irrespective of the project progress.
   
   

Personal Finance Daily Digest - December 16, 2009

PACking a punch: look for hidden costs in Ulips - Mint

If the 100% allocation ad pitch got your attention, beware. The costs are still all there, they have just been moved in a way that you can’t see them now
Much like other statutory warnings that manufacturers of harmful products hope you won’t really listen to, ads for unit-linked insurance policies (Ulips) are followed by a jaded voice, chanting: “Please read the policy document before investing”. And, there is a very good reason for you to heed that voice. Insurance companies are removing costs that you recognize and are stuffing them in places that you don’t see yet. To understand the issue fully, we need to understand all the Ulip costs first.

Personal Finance Daily Digest - December 15, 2009

7 sinister secrets Mutual Funds don’t share - MoneyControl

Indians trust mutual funds, for the most part. We question our brokers, financial advisors and insurance agents, but mutual funds rank higher in the trust pecking order. Unfortunately, while mutual funds are called the “safest form of equity investment” and the “ideal choice for small and new investors”, their interests are not always your interests. Popular press has made basic realities – such as entry loads and commission structures – public knowledge, but AMCs have many more tricks up their sleeves, many of which are globally acknowledged, but unknown to Indian investors. Presenting seven rarely discussed money management problems and what we can do to alleviate them: