Jitendra Kumar, IBS-Mumbai 2008-10
What’s your plan five year down the line?
Getting good JOB
1
Beautiful Wife
2
Buying Car
3
Purchasing Dream House
4
Make your dream true
Purchase PlanningBuying Car
Motives:
Reduce the traveling time and also make the travel more comfortable
Status symbol or simply for pleasure
The Factors to be considered before purchasing the car:
1. Affordability:
Availability of finance for buying an automobile
Capability to make the requisite down payment and the monthly
installments
Care should be taken to ensure that one’s budgets and financials are not
heavily disturbed as a result of opting a certain scheme.
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Factors to be consideredBuying Car
2.Operating Costs:
Installment costs
Insurance
License fee
Fuel and oil costs
Repairs and maintenance costs
Depreciation
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Factors to be consideredBuying Car
3. Brand New or Second Hand:
Advantages of buying A USED car
Lower down payment to be made
Less expensive than the brand new car
There will not be a high depreciation
oDisadvantages of buying a USED car
Maintenance costs may increase, as the car is a used one
Problems like low mileage may occur
Expenditure may have to be incurred for investigation of the vehicle
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Factors to be consideredBuying Car
4. Features of the car:
Size of the car
Performance of the car
Handling and appearance
Fuel economy
Reliability and possibility of repairs
Resale value of the car
5. Reliability and Warranties:
Reliability can be checked by contacting people who are using the
particular brand or by browsing through magazine or consumer reports.
Scrutinize the documents pertaining to the warranty provided.
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Factors to be consideredBuying Car
5. Purchase of the car:
Visit all the dealers and have a look at all the cars, which may suit your
requirement and available budget.
eg: www.carwale.com, oldcardealers.com,
Local used car dealers:
A.C.T. India Ltd., Guindy;
A.C. Swamy Cars & Real Estate, Valasaravakkam
6. Price negotiation
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Factors to be consideredBuying Car
6. Price Negotiation:
In case of new car, there can be no bargaining, as the car is available at the
showroom price. But the ‘car on road’ price is different as it includes costs of
certain accessories and insurance. Thus, bargaining can be done.
Dealers may also give discount on those models of cars, which are not
much in demand.
7. Financing:
Various financing options are available of many companies providing
financial services such as ICICI and HDFC bank.
Website auto.indiamart.com also provide auto loans
Maker your dream true
Meeting Housing NeedsBuying House
Food, Clothes and
Shelter are a man’s basic
necessities.
People have different
housing needs according to
their tastes, preferences
and financial conditions.
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Various forms of HousesBuying House
1. Independent Houses: owning an independent house has become
extremely expensive especially in the urban areas and metropolitan
cities.
2. Condominiums: It’s a form of joint ownership. It can be in the form of
an apartment, townhouse or cluster houses. Buyer of the condominium
has the ownership title of a particular unit, and joint ownership to
swimming pools, lobbies, clubhouse etc.
3. Apartments: The most common form of housing facility available
today. Apartments are less expensive and affordable and can be easily
maintained. It is best suited for a small family, as it both affordable and
secure.
Maker your dream true
Motives of buying a HouseBuying House
1. Basic necessity of life
2. Source of income:
3. Tax shelter: Owner can obtain tax rebate on the installments and the
interest.
4. Inflation Hedge: An inflation hedge occurs when the value of the
property rises or appreciates equal to the rate of inflation or even
greater than it.
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Buying processBuying House
The decision of investing in a house property involves a lot of money,
time and effort and has a long-term effect. Thus, before taking a decision
in this issue, following aspects should be taken into consideration-
1. The Market:
The information in various sources like News Paper, Internet, Real
Estate Agents.
Indiaproperties.com provides proper information about housing
property.
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Buying processBuying House
2. Emotional and Financial factors:
Person should be clear about what he/she actually requires(Optional
features, affordability analysis)
3. Agent:
A real estate agent has requisite knowledge and the contacts to find
property that would suit the requirement of the buyer.
The agent would also help in negotiating the price of the property
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Buying processBuying House
4. Applying for mortgage:
It is essential that borrower applies for mortgage and arrange the
loan in advance.
The prequalification for the mortgage also helps to enhance one’s
bargaining power as the seller can be made aware of the limit of the
loan.
Following document has to be presented at the time of applying for loan
Proof of monthly income
Assets owned and debt owed
Amount in the savings accounts
Loans such as educational loan taken, if any
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Buying processBuying House
5. Sales Contract: contract in writing giving following information
Names of the buyer and the seller
Description of the property
Price of the property
Signature of the buyer and the seller
In addition to these requirements, the contract may include certain
provisions such as-
Earnest deposit money:
Contingency clause:
Closing cost:
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Buying processBuying House
6. Closing the deal:
Title of the property be properly checked
It should be ensured that the title is free of liens and encumbrances
Person selling the property has the legal right to sell
7. Closing statement: The closing statement is provided to both the buyer and the seller,
before closing the transaction.
This statement reconciles the costs incurred by both the buyer and the seller and indicates how much buyer owes and the seller received.
Statement is signed by both the parties in order to make sure that it is accurate.
Thank You
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