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05 Feb 2012
Glossary
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Amortization: Amortization means the method or the calculation by way of which the entire principal / loan amount is paid through the tenure of the loan. This helps a customer to know what his outstanding principal is at any point in time.

Asset: An immovable or movable property which can used as a security against which credit can be offered.
Bouncing charges: These charges are levied by Deutsche Postbank Home Finance Limited, if your cheque gets dishonoured due to some reason.
 
Compound Interest: Interest charged or paid on the principal and the accumulated interest, unlike Simple Interest which is paid only on the principal.

Co - applicant: As a customer you have an option of having a co - applicant to your loan. The co - applicant cannot be a minor and Deutsche Postbank Home Finance Limited allows for only brother - brother, parent - son and husband - wife combination to be a co - applicant.

Co - owners: Deutsche Postbank Home Finance Limited insists that all co - owners have to be co - applicants necessarily. No minor is allowed to be a co - owner as a minor cannot enter into a contract as per law.

Cost of property:
This refers to the total cost of the property including various charges as acceptable to Deutsche Postbank Home Finance Limited.

Depreciation: The decline in value of an asset over a period of time.
 
Eligibility: This is the loan amount that you get based on your repayment capacity. Your eligibility depends on the norms set by the Deutsche Postbank Home Finance Limited .

EMI: The loan can be repaid by paying a fixed amount every month, known as Equated Monthly Installment.
Fixed rate of interest: This is an option that is available to you when you avail of a Home Loan. Under this, the rate of interest remains fixed over the tenure of the loan. The rate remains constant after the final disbursement has been made.
 
Gross Monthly Income: GMI stands for the Gross Monthly Income of an individual as considered by Deutsche Postbank Home Finance Limited to calculate his/her loan eligibility. For a salaried customer, GMI would indicate the Monthly Income on his salary slip including any Fixed Income generated regularly from a fixed source.
Loan Tenure: The time duration for which loan has been provided.
 
Monthly Rests: This is also called Monthly Reducing Balance of principal. The calculation in this method is on a monthly basis and the EMI is broken up every month to arrive at the opening balance of principal for the next month.
Own contribution / Margin Money: This is the minimum amount of money that you need to put as your own contribution towards the purchase of the house. Deutsche Postbank Home Finance Limited insists that this amount is paid upfront before they release any disbursement.
 
Pre Approval: In a Home Loan, you have a facility to apply for a loan before you decide on the property. The loan is sanctioned however, disbursement takes place only after the property is selected and is technically and legally cleared. Such cases are called Pre approvals as the loan is approved before the customer selects a property. This helps you to decide on a budget to buy a property of your choice.

Prepayment: At any point in time you can pay back the loan amount either in parts or in full. This is called a prepayment.

Principal: The capital sum in a finance transaction as opposed to interest.
 
Refinance / Balance transfer: If you are an existing home loan customer and you have availed of the loan at a higher ROI then you have the option to switch to a lower rate of interest.
 
Security: It is the asset that you mortgage with Deutsche Postbank Home Finance Limited against which a loan is given to you. Typically, the security is the house for which a loan is given.
 
Tenure - This is the term used to represent the number of years for which the loan is given. The loan amount gets amortized over the period of the loan.
 
Weighted Average Rate of Interest: In case of Home Loans where the disbursement takes place as per the stages of construction of the property, the interest rate in the market may change during this period.
 
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