Debt Counselling: Mohan Jayaraman

I have dues of Rs 35 lakh including housing, car, personal and credit card loans. While I have been repaying regularly now, I am unable to save anything. I had missed paying personal and credit card loans for six months last year. Can I approach an asset restructuring company for help?
Most banks assist their genuine customers and help them in reconciling their loans. Asset reconstruction companies come into the picture when banks have passed on these loans to them. It is best to approach your bank in the first place. Alternatively, there are some financial counselling organisations that operate on a non-profit basis. You could approach these financial counselling firms; they shall help you prioritise your payments and plan your finances with a goal of improving your credit history in the long term, taking into consideration your resources and constraints.

Is it advisable to prepay housing loan at the earliest? Or, should one stick to paying regular EMIs as housing loans offer tax benefits?
Regular EMI repayment of housing loans is an indicator of credit discipline. The decision of whether to repay the loan or not is a function of a multitude of factors like the interest rate charged, balance tenure, whether the interest rate arrangement is fixed or floating, etc. Any prepayment of loan shall reduce your fixed obligations and thus improve your ability to take debt for other purposes.

I am in need of raising money for some emergency. While I don't have enough cash, which is a better way to do so - loan against property or loan against bank deposits?
Loan against property and loan against fixed deposits are both secured loans. The decision between secured instruments is typically a function of interest rates and the loan tenure. Both these factors have a bearing on the instalment outflow. In specific arrangements, these facilities are offered as overdraft limits. Loan against bank deposits generally has a better approval pace, since lesser due-diligence is involved and typically a lower rate, too.It is prudent to only avail such amount as is warranted to tide you over the current cash crunch and also to keep your repayment capacity in mind.

The views expressed are expert's own. Send your queries to yourmoney@bsmail.in

Today, Mohan Jayaraman, managing director, Experian Credit Information Company of India & country manager of Experian India, answers your questions