What's in a name? .. ipad

Shakespeare said "whats in a name..". Apple seems to be taking it seriously.

Yesterday when the "Applet tablet event live" was going on, there was more discussion on the naming than on the specs. My view is rather than going with their old nomenclature of iMac/iPod, they should have gone with iPhone like naming and called it iSlate. I hope they still change it before it becomes a total confusion in day to day life for women.

I think this is a big shame on apple that their most awaited launch since iPhone has been totally dumped by the audience. Out of 100s of tweets that I followed while the event was on, there were hardly any tweets on new features. Most people called it a magnified iPod Touch, some called it large iPhone without calling features.

The most important missing features was camera for video conferencing. If they have put iWork on it, do they expect the person to carry another device for video conferencing? I think there has been a major downgrade in the feature list by apple to take into consideration the business limitations of not conflicting with iPhone.

This likely being the last big launch of apple under Steve Jobs, I had expected much better.

The only real surprise for almost everyone was price, lets see if the price alone can sell this. Never underestimate the power of apple fan following.

Home loan overdraft calculation sheet

Okay, so blogger does not allow uploading attaching files but google docs does, its a cool new feature I think. 

Here you go. The excel sheet can be found here. The copy of the description from gharonda email is as below:

It handles max of 20 years of loan calculation. Does the EMI, pre-EMI calculation for you. For simplicity sake I am assuming the deposit is made on 1st, else one can calculate and put the number.

For basic users, please fill in the sheet with yellow color cells, rest will be calculated automatically.

For others who want to put in different amounts in different months can modify the blue colored cells.

In the given sheet a sample is already filled in, it shows that along with EMI of Rs. 9651 if we pay only 500 extra in this account for a 20 year loan of Rs. 10 lakhs, the interest saving is 2.15 lakhs, please note that at no point of time did we actually maintain a balance of more than 1 lakh (approx). After 207 months in this example, you can stop paying EMIs as it will be taken care by the savings you would have put in this account.

This sheet can be further modified to calculate interest for interest rate changes and part disbursal. Let me know if anyone needs these options.

The few things to try here are:

1) If you just put your monthly savings every month, how does it look. (Remember your saving is working hard for you)

2) If you just put your annual bonus into this account, how does it look. (Its better than pre-payment, as the amount is not gone away, if you need you can withdraw)

To take max advantage of this loan I recommend:

1) Take max tenure possible

2) Take max amount of loan possible, put the rest in this account and you have a ready emergency fund which works for you.

I call this account "magic" account :-). It’s a magic account for people who are disciplined, if you put some money and keep on removing it every month, then it does not get you that good a benefit.

 

Loan Amount	1,000,000.00
Interest	10.00%
Tenure	20.00
EMI	9651.00
Start Date	40200.00
Pre EMI	2740.00
Total interest	1316240.00
Net Monthly Addition	500.00

 

Effective Tenure	207.00
Effective Interest	1,101,606.82
Interest Saving	214,633.18

Cheers!

Home Loans with overdraft account

We have a google group of techies from Hyderabad call Gharonda where we share information regarding various residential projects and related stuff like loans. It is a good initiative as a group of people interested in a particular project can get together and go for bulk deals. Recently other groups have spun-off for other cities on similar lines.

Here is an email I sent out to Gharonda group some time back which many found very useful.

I would very very strongly advise everyone to look at the scheme of home loan where loan is awarded as overdraft. It saves interest and thereby reduces tenure, and turns the argument that home is very illiquid investment on its head.

More details on above.. 

This facility is currently offered by SBI (30 lakh limit), Citibank, HSBC and stanchart. Only citibank and SBI are pursuing home loan customers seriously at the moment.

In this type of loan a current account(no 3.5% interest as in case of savings account) is opened in your name where balance is :

-1 * loan amount

and the interest is charged on outstanding -ve balance. A simple example would be, lets say one takes a loan of 25 lakhs, so the starting balance would be -25 lakhs, which would keep reducing with as the EMIs progress.

Then as and when possible, we should put all our savings into this account. All amount deposited are withdrawble like we can withdraw from a savings account using debit card, cheque or online transfers.

Assuming that after the payment of 24k EMI you are saving another 10k per month, it can be deposited in this account and the interest can be saved. Lets say in the first month, the loan outstanding was 25 lakhs, and a deposit of Rs. 1 lakh was made on 10th, so for first 9 days interst is charged on 25 lahks, then for remaining month the interest is charged on only Rs. 24 lakhs which was the outstanding balance. So just by keeping 1 lakh in that account you would have saved 10%/12 * 20/30 * 1 lakhs = Rs. 555 in interest and this has been reduced in your outstanding principal, that means though you paid the same EMI, you have taken a tiny step towards a quicker loan repayment. This small "Extra" payment into your homeloan will save you interest till the tenure of your loan.

The best advantage of this product in a few years you can deposit all your savigns in this loan, bring the outstanding balance to 0 and pay 0 interest on your loan, without any prepayment and have ample liquidity for all your emergency needs.

I think SBI has waived off the limit of 30 lakhs, as one of my friends recently got a loan of 35-40 lakhs with the new 8 pct scheme and overdraft account.

There is an excel sheet that I prepared to demonstrate the calculation, let me figure out how to attach it and I will post it here.

Cheers!