What you mean the GOLD INVESTMENT ?
I am living in Dubai (UAE) I want know how can invest in gold investment- what the lowest investment in gold market-basically I am an indian.
Bank Loans
There are many different types of bank loans available and we are going to look at a few here. First we have the 15 and 30 year mortgage loans. A 15 year mortgage is they type of mortgage that requires higher monthly payments. The flip side to this though is that it builds equity a whole lot faster. A 30 year mortgage is the type of mortgage that generally costs more in the end but will give you a lower down payment.
Next we have adjustable rate mortgages also known as ARM’s. These differ from fixed rate types of mortgages because in an ARM the interest rate and monthly payment can increase and decrease depending on the market rate.
Now we have what is called a home equity loan. This loan is sometimes abbreviated HEL. The HEL is the type of loan where the borrower will use the equity that they have built up in the home they own as collateral . These loans can sometimes be very useful when it comes to helping finance any medical bills, large home repairs, or even your child’s college education. The only downside to a home equity loan is that it creates a lien against the home thereby reducing your homes equity. This is also considered a second home mortgage.
Next we have an interest-only loan. An interest-only loan is a loan that is set for a specific term and the borrower will pay only the interest on the principal balance .
Another type of loan is a consolidation loan. A consolidation loan is the action of replacing multiple loans with a single loan. This type of loan often comes with a lower monthly payment but a longer repayment period . This can also be called debt consolidation.
A line of credit is a certain type of revolving credit in which you’re home or other property will serve as collateral. No matter which loan you choose the general basis as to whether you get it or not will be based on your overall credit. You don’t get much with bad credit.
CAR LOANS UNDER ISLAMIC BANKING
February 28, 2009 by Muhammad Haidar
Filed under Loans, Muhammad Haidar
Current Scenario: The auto industry, especially in the United States, is in a downward spiral alright, and no one has a clue what’s in store for this industry. The same trend is noticeable in other parts of the world, including Japan. With the biggest names in the auto world like General Motors, yes GM, and Toyota bleeding non-stop, it is anyone’s guess how long these venerables of the auto industry can hold out against the market elements.
Time For Bargains: For the consumers though, especially those on the lookout for a good deal, many bargains are to be had for the asking! This may be the best time to strike the iron i.e. buy a Car! And there are any number of financing options available to bring that dream car of yours into the garage!
The Islamic Option: In this article, we shall take a look at the Islamic financing option for purchasing a car. Financing for purchase of cars under Islamic Banking is done under the contract of ’Murabaha’. Simply speaking, this is a cost plus profit mark up contract.
Typically, the Islamic Bank or financial institution would have certain criteria to evaluate yor creditworthiness and eligibility for a car loan, having regard to your income either from salary, or business i.e. your occupation, and other sources; your monthly expenditures, statutory payments etc, and finally your net income.
Now, suppose after going through the above process, the Bank gives you the good news-that you are indeed eligible for a car loan of USD 25,000.00 that you had asked for, to buy your dream machine. The next step would be to work out the profit mark up of the Bank on the loan amount. Suppose this works out to USD 5,000.00. That means the total cost of this deal, for you, is USD 30,000.00. Of course, the Bank would have factored its profit mark up while calculating your eligiblity amount for the car loan. The other variation in the above case would be that the cost of the car is USD 20,000.00 and the profit mark up USD 5,000.00 or less as the case may be.
Apart from the above, other details to be worked out include:
Down Payment: Some Banks would require you to make a down payment for the car-that would increase your stake in your dream car, as well as bring down the amount/number of instalments payable by you.
Repayment: The loan amount, plus the profit mark up, put together, would be divided into equal number of instalments, agreed upon, say, 60 or 72 as the case may be, and you would be required to repay the same within the stipulated time. Some Banks offer a moratarium on repayment, that is, they allow you to start repayments after, say, two or three months after disbursing the loan. Some other Banks also offer to rework the instalments after a part of the loan is repaid. Say you have repaid 12 instalments. The Bank then works out a new EMI on the balance of the loan amount remaining after payment of the 12 instalments. Upon full repayment of the loan, your car becomes really yours!
Add-Ons: In the increasingly competitive environment that the Banking industry is functioning, it is not unusual to get a few add-ons with your car loan – zero balance account, free/concessional insurance for the car, free advisory services in respect of the car loan, as well as other services on offer by the Bank, etc. Do avail of the freebies!
The Delivery!: Assuming that you have already identified your baby, that is your dream car, and the place that you wish to buy at, it is now the turn of the Bank to buy the car from the dealer on your behalf, and have it delivered to you!
Go on and Enjoy your Drive! Of course, there are no free lunches. Please do your due deligence before deciding to take a loan. And don’t forget that seal belt! HAPPY DRIVING!
Investment in India?
Is it better to invest in the Indian market with a loan from a bank in Dubai or a loan from a bank back in India? and which bank?
HOME LOANS UNDER ISLAMIC BANKING
February 27, 2009 by Muhammad Haidar
Filed under Loans, Muhammad Haidar
The major reason for the current financial and economic crisis in America is said to be a rash of Bank failures. And Bad Home Loans are said to be the major reason for the Bank failures in the United States.
Quite simply, American Banks had been overfinancing home buyers. Suppose a potential home buyer approached his Banker for a home loan, and his credit rating and financial standing would entitle him to a home loan of, say, USD100,000.00, his Banker would gleefully advance him say USD150,000.00! Naturally this borrower would not be in a position to repay the stipulated instalments because of his lower repayment capacity. This would eventually lead to a default on part of the borrower, rendering his loan account a non performing asset.
In the light of the Banking crisis in the United States and also in Europe, it would be worthwhile and also interesting to have a look at the home loan financing scenario under the Islamic system of Banking.
Typically, under the Islamic Banking system, home loan financing is based on the principle of Profit Mark Up on the cost of the property, by mutual consent of the Bank and the Borrower. This type of financing is usually done under the contract of Murabaha.
It goes like this. Suppose you are interested in buying your dream home (who’s not!). You approach the Islamic Bank with your requirements with regard to the financing. The Bank in turn would assess your requirements as well as evaluate your eligibility for the financing based on your income and repayment capacity. After taking an overall view of your financial standing and credit rating, the Bank would fix a eligible amount of home loan for you. Let us say the Bank fixes a home loan limit of USD100,000.00 for you.
This amount would include their mark up on the cost of the property. This mark up is fixed by mutual consent . Suppose the mark up is say USD 10,000.00. That means the net amount of your home loan is USD90,000.00. The next step for you,the borrower, is to identify your dream home in the range of USD90,000.00. After that you give details of the property thus identified to the Bank, who in turn will negotiate with the owner of the property and make a purchase of the same specifically to sell it to you.
The next step would be to complete the formalities in regard to documentation etc., after which you get the possession of the home, though you are still not the owner of the same. The ownership will vest in you once you repay the stipulated number of intalments within the repayment period fixed. Then your dream home becomes really yours!
The main characteristics of the above type of home loan under Islamic Banking are: a proper evaluation and assessment is made of the repaying capacity of the borrower and fixation of the appropriate loan amount. Another notable feature, which is in fact the bedrock of Islamic Banking, is the absence of Interest on the loan amount. Instead the Bank adds up a profit margin to the cost of the asset and divides the total amount into equal instalments payable usually monthly.
The above example is a simple type of home loan under thIslamic Banking System. Within this system, variations are possible to suit the specific needs of the borrower.
ISLAMIC BANKING AND FINANCE:MUSHARAKA
February 26, 2009 by Muhammad Haidar
Filed under Loans, Muhammad Haidar, Uncategorized
Literally speaking, Musharaka means partnership or a system of sharing. It is one of the several financing options available under Islamic Banking.
There are two types of Musharaka-Direct and Diminishing.
DIRECT MUSHARAKA: Under this option of financing, the Bank and the Customer form a partnership in which the Bank provides part of the capital to the customer and the customer manages the project apart from providing part of the capital. The proportion of capital provision by the two parties is mutually decided upon in advance. It is the customer that runs the business enterprise.
The notable feature of this partnership is that the liability of the partners is unlimited. When the business suffers a loss, it is distributed between the Banker and the Customer in the agreed proportion, whereas in case of profit, it is shared between the two in proportion to the capital contributed by them. The contract may also provide for the customer to be exempt from running the show or the business, in which case the share of the Bank in the profit would be proportionately higher.
The Musharaka contract is based upon real capital and specific limits and not on the basis of debt. Partners to the contract should know the extent of their participation in the capital and their share in the profits and losses at the time of making the contract. Uncertainty in the terms of the contract would vitiate the contract. Normally, these contracts are pursued by the partners till the final objectives of the venture are achieved. However it is permitted for either of the partners to exit the partnership with the consent of the other.
DIMINISHING MUSHARAKA: In this form of contract, the Banker agrees to part finance the project and also agrees to exit the partnership voluntarily upon repayment of his share of the capital by the other partner, the customer. This repayment must be made within the specified period. The customer agrees to bring in his share of the capital and act as a trustee for the entire capital.
Like in the case of the Direct Musharaka, the loss from the business venture is distributed among the partners in the agreed ratio, whereas profits are shared between them in proportion to their capital contribution.
As per agreement, the Bank agrees to sell its share of its capital to the customer over an agreed period of time, and the customer buys out the Bank share in the partnership so that eventually the customer becomes the master of the whole enterprise.
This type of financing is a very convinient form of financing where customers can rely upon the Bank not only for capital but also managerial expertise. And in the course of time, the customer becomes the sole owner of the business enterprise. For the Banker, this arrangeement ensures a regular, and steady income. Further, losses are shared according to respective share in the capital, thereby reducing the burden of losses.
There is a third kind of Musharaka financing that is akin to Venture Financing which will be the subject of another article.
Author’s Note: Readers may please note that the above article is meant to be a introduction to one of the forms of financing available under the Islamic System, and not an exhaustive study of the same.
What companies provide financing for a mobile home?
February 25, 2009 by admin
Filed under Renting & Real Estate
I live in a 1987 doublewide mobile home – its made out of wood not tin. I own it 100% and its valued at $40K+ but it needs work – like new windows and I would love to remodel the kitchen but have yet to find any companies that offer financing.
Per the county thats what its valued at – please don’t answer if you are ignorant.
Its in a park – I was told by my bank they would finance moving it and a piece of land. I just want an improvement loan.
مقابلة مع الشيخ محمد Dubai part2
February 25, 2009 by admin
Filed under Uncategorized
Dubai is a tiny sheikdom with big dreams. Thanks to a combination of extraordinary wealth and vision, it has transformed itself from desert sand into an international business center and tourist destination. The man behind Dubai’s rise is its leader Sheikh Mohammed bin Rashid Al Maktoum. Steve Kroft introduces us to the Sheikh and his desert oasis.
Bank Loan Funds
As interest rate climb, most bond owners are shaking their heads. The price of existing bonds falls when rates are on the rise. There is a way to offset the decline. You can invest in bank loan funds, also known as floating rate funds. There is a risk to these funds, but they can be a rewarding alternative to traditional fixed-income investments.
Bank loan funds are made up of loans made by banks or other financial institutions to companies. They are often below investment grade. They aren’t really fixed income; there is the potential of losing money. The funds can provide a return equal to or better than high-yield money market accounts. The loans that make up the funds are short-term. This allows the lenders the opportunity to frequently raise the interest rate. This helps the funds keep pace with interest rate changes and helps keep the principal more stable than with a typical bond fund.
According to many portfolio managers, the way the loans are structured removes a lot of the risk to investors. The loans are secured by cash or assets. The funds are not independently rated, but experts say the bank should be able to show you the performance of the fund. The bank will package the loans and sell them, and the funds come into play.
Ban loan funds are senior loans. If the company defaults, senior loans must be paid back before bond holders are. You may not receive enough to cover your initial investment, but something is better than the nothing you could receive with a high-yield bond. Typically, in the case of default, the investors will recover 75 to 80 cents on the dollar.
The change of losing principal is reduced because the interest rates on the loans reset very quickly. Short-term interest rates rise and fall in response to the Federal Reserve. That, combined with the short terms of the loans, makes for a fund that responds quickly to the rise and fall of interest rates.
Many brokerages, including Merrill Lynch and Eaton Vance, sell bank loan funds. In certain asset classes there may be a high expense ration. Make sure that you check every fund out carefully.
Many funds in this group allow investors to buy shares at any time. There are some funds that will allow you redemptions at any time, while others will restrict you to monthly or quarterly redemptions.
I am replanning my retirement due to difficult circumstances; can somebody help and give me ideas?
February 24, 2009 by admin
Filed under Small Business
Because of health problems I had to retire at age 40 about 18 years ago from IBM Dubai. So far I have been relying on banks and live from whatever little returns I got because my ‘handshake’ stayed in tact. I would like to maximize my earnings with minimum risk involvment. Also I can work from home. A combination of both should in my opinion give me a comfortable life in Pakistan. My responsibilities are minimul. I live at my own home with mother and sister. No tax obligations either. I am on the net exploring all possibilities before I take any decisions about investing but I can start working from home rightaway if you guide me. I can devote all my time in the day to such an activity. I have got a new notebook with a broadband connection. If I get encouraging response I can exert more effort.
I can move to another country if you like me to assist you in your business; might need a little training. Feel free to discuss, even emigration and long term relationship with a kind lady!!!!