A vast segment of India's population exists on the margins of India's financial systems. Whilst the per-capita savings of this class may not be very high their sheer number means that taken together their savings are of a considerable amount. If their entry in the formal financial sector is made easier these savings can be channelised for the formal economy. Also savings cum risk products that are their primary need can be structured for them once they are part of the formal banking system.

The earlier rush to invest in property has slowed down. Even the builders are looking for buyers who are looking for a home to live in than speculative investments. "This is a good time to invest, as any other time because the property prices are likely to remain stable. It also depends on the location of the area of investment. Prime properties and areas like Navi Mumbai offer good investment opportunities. Investment from speculation point of view is not recommended due to high interest rates," says Mantri.

Man knows little of what fate has in store for him. When you take a home loan, it is on the basis and assumption of continuing income. We run into all kinds of risks in our daily life. Accidents and health issues like heart attacks, stroke, paralysis, kidney failure and other physically crippling ailments can cause loss of income or in some cases, even your life. Home loan is a fairly long-term liability. This is why when you take a home loan, it is advisable to take a life insurance and critical illness policy. Life insurance policies provide monetary benefit in case of an unfortunate incident like death and ensure that your family members inherit your home not your home loan. Critical illness policy will take care of the home loan liability if your income gets interrupted due to unforeseen, unavoidable circumstances which such conditions may create. That will be one less thing for you to worry about while you are anyway under severe stress. Best of all, most banks will be happy to finance the one-time premium payable for both policies, enabling you to get this protection at a small addition to your regular premium.

If you go in for a transparent floating rate home loan, you also get the benefit of reducing interest rates as (not if) and when the interest rate cycle turns and commences on its downward journey. Even if the interest rates rise, in the interim as long as they do not rise above the 1.00% differential; you are still a net gainer.

Like in advanced economies, the influence of an effectively functioning credit bureau pervades all aspects of your life. Want to take a house on rent? The landlord will want to check out your credit report to judge whether you pay your bills on time. Want a job involving sensitive or valuable information?

So, does it mean that the sector will be stifled for cash? -- Experts feel that such a situation should not arise because there is money that is coming in through Foreign Direct Investment (FDI) and a lot of builders are also approaching the stock market in the coming months. As Lodha puts it, 'We, as builders will, also factor in these measures in our own growth plans.'

Real estate players think that the present prices may be able to hold firm till March 2007. However, one could see some downward correction in the prices post-March. What is important is that there should be new supply in the estate market to help control prices. Presently, the slackness in activity is not very apparent because foreign investors are pumping the money and Indian builders are also aggressively trying to tap the IPO market. So, new projects are still on the anvil.

This often leads to a common mistake of assuming that it is better not to prepay, say, after half way through the loan tenure, because the interest component is low now. But the fact is that the interest outgo as a percentage (which is what the interest rate is) on outstanding principal is the same whether it is after the 24th month or after the 120th month.

It is during the interest rate reduction that this trend is most visible. An existing borrower (or wife) has been given a rate of interest of (say) 2% below the Retail Lending Rate. {The Retail Lending Rate is just a nomenclature and different banks have different names for this reference rate).

Bankers are willing to wait out for a few weeks to get a clearer picture. "The trigger to increase the CRR is the current liquidity in the market. Speaking about its impact, banks are unlikely to raise interest on a short-term basis", said a State Bank of India official.