A public sector bank, recently cut its base rate and said interest rate cuts would be passed on to customers soon. Does this signal rate cycle reversal? I plan to take a home loan. Should I wait for some more time?
The market expectations are that the interest rate cycle may have reached its peak and rates may soften towards the second half of 2012.

However, it is prudent to note the interest rate movement would depend on the cost of funds of each bank, in addition to the actions taken by the Reserve Bank of India in its regular monetary review.

You need not postpone a decision to avail a home loan, since interest rates are now linked to the base rate. Any downward movement in the market rate is likely to translate into a reduction of the base rate and, consequently, your home loan rate, too, would go down.

I had deposited Rs 1 lakh in a one-year fixed deposit with a public sector bank last year in February. Due to an emergency, I need to withdraw that money. Should I take a loan against it or is it advisable to break the deposit?
Banks have the facility of providing an overdraft against fixed deposits. If you require the money for a short term of up to six months, it is advisable to take an overdraft against the fixed deposit. In this case, interest would be charged for the time you have utilised the funds.

Should you decide to break the fixed deposit, a penalty may be levied, i.e the interest paid to you after breakage of the deposit will be interest earned for the period, minus the penalty due to premature withdrawal of the deposit.

Last month I had settled my credit card dues of Rs 30,000. Interest charges of Rs 5,000 were waived off. However, my credit score still reflects an outstanding amount of Rs 5,000 towards as outstanding. This, despite a no due certificate from my bank. How do I get the credit record rectified?
By credit score card, I presume you refer to a credit rating agency record update (like Cibil) against your name. Since banks update records with the credit bureaus at a fixed periodicity, the credit bureau report not reflecting the Rs 5,000 reversal may just be a timing issue. I suggest you check again after a period of one month, and see if the report is updated.

You can write to your credit card issuing company and ask them to send a rectified update to the credit bureau, which reflects the current position of no-dues against your name. The credit card company is required to act upon this and send the corrected update. Do also get the confirmation from them that this has been done, and keep the confirmation for your records.

The writer is MD & head, private & business clients (India), Deutsche Bank. Views expressed are his own.
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