is it safe to opt for home loan with floating interest in this time?



I’m planning to take a home loan. Friends please suggest. People say tat floating interests are very risky. Now markets are improving and I’m worried tat if floating interests raise drastically which hampers my financial situation. Pls help.

is it safe to opt for home loan with floating interest in this time?
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7 Replies to “is it safe to opt for home loan with floating interest in this time?”


  1. It took hardly one year to fall from 21000 to 7500 and to take it back to 21000 will take a long time.
    The reason being as most of company in india have not done well in the 2008-09 and will take atleast a minimum of 3 to 4 years to recover form the worldwide recession.
    However the Good News to CHEER about is given below;

    Sensex at 1 lakh points?
    Possible, says research group.
    It may sound utopian in the backdrop of months-long downslide on bourses, but a US-based equity research group sees India’s benchmark index Sensex scaling a milestone of 1,00,000 points within next 15 years. This would mean an unimaginable rally of over 10-times from the level seen just a few days ago, when Sensex was toiling below 10,000-point mark after a meltdown that began more than a year ago.

    The Sensex had more than halved to trade below 8,000-point mark in October last year after scaling a record high of over 21,000 points on January 10, 2008.

    Unperturbed by the sharp fall, US-based global equity research group Elliott Wave International, which specialises in analysis of technical charts of stock movements, believes that the recent surge in Indian market is the beginning of a long-running bull cycle that could continue for 15 years. The recent upsurge began on March 9 and the Sensex has gained over 2,500 points or by more than 30 per cent.

    “If the price and time proportions between the waves in the 2003-2008 rally continue, the Sensex should hit 100,000 in about 15 years,” research group’s Asia-Pacific Financial Forecast editor Mark Galasiewski .

    In its report for Asia-Pacific markets, based on analysis of technical charts, Elliottt Wave has said there were strong indications of “a resumption of the bull market in Indian stocks”.

    Extending its previous analysis in November last year, when it had said the Sensex might continue advancing for 15 years before the end of another bull run, Elliott Wave said the market seemed to have completed its most recent downward spiral in October 2008. The Indian stock market benchmark Sensex had scaled an all-time high of 21,206.77 points on January 10, 2008 before embarking on a downward journey, wherein it touched a low of 7,697.39 points on October 27.

    According to the Elliot Wave’s April forecast report, the Sensex has declined in three waves to the October low, where it retraced approximately 50 per cent of its 2003-08 rally on a percentage basis. The index has just broken out of its downward trend c hannel and the patterns seen recently and during the 2003-04 period “are the best argument for a resumption of the bull market in Indian stocks,” it added.

    Naming India among the “potential baby bulls” of the region, alongside Taiwan and Korea, Elliott Wave had said the completion of three waves of fall from their respective highs had made them “strong candidates to rally back to at least near their all-ti me highs — if not beyond”
    BEST OF LUCK !



  2. It totally depends on your situation. Even an adjustable rate mortgage (ARM) is fixed for a set period of time. If you absolutely have an escape strategy like knowing you are going to sell in a few years and having the equity to do it, an ARM may save you thousands. If you are staying long term, have little equity or no financial plan, you have no business even thinking about an ARM


  3. Lets try and predict how the interest rates will move. Inflation is high. One way to control it is to control money supply, i.e. to make money costlier, i.e. to raise interest rates!
    Also the world is facing a recession. World governments are pushing many stimulus programs and therefore would not like to push interest rates up!
    Its a dilemma. Anyways at 8%, the interest rates seem low and the chances of their going up are more that that of them coming down.
    I would like to go with the certainty of a fixed interest rate at this point in time 🙂


  4. Millions of people who lost their homes were sure they could sell or refinance in a few years.

    ARMs are like gambling. If you’re comfortable with the risks, go ahead. But they’re the opposite of safe.


  5. Even fixed rate, it is valid for three years only and then it will be revised. If it is floating, you will find changes even in a month.

    Now the rate of interest is minimum. Earlier, in BJP period it was just 7.5% and you cannot expect that low in the present government. So it is better to opt Fixed for the first three years and then you can decide the further mode later on after three years!





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