thanks for all the responses gentlemen, i finally found the issue. it wasn't with my setup or even the way I drove, it was with the controller itself.
A while ago I bought a cheap, second hand logitech G29. I had only used it once before while playing GT and it worked like a charm..recently after university exams i started playing again but this time i tried it on for LFS. and ever since then i had been having issues with steering which i though was as issue with the game. Turns out there's an issue with the controller itself.
I found this issue today when i decided to play GT again. I was sliding all over Spa... when i found out it was the same issue as with lfs.
Either hectic understeer or when i tried turning hard, it would oversteer and spin out. The issue is funny because i've never encountered it before. the wheel turns normally uptill a certain point, after which it maxes out (this happens for both Left and Right corners). Anyways, so I tried playing with my old logitech momo wheel and it worked like a charm! NO understeer and NO spin outs
Thanks once again for your responses. It's really nice to see so many people responding to what was such an amateur mistake.
BTW: My times have drastically improved. First time, on blackwood with the FBM and i reached 1:19. I know its not that fast as compared to you all but i'm getting there.
Cheers legends.
Prost!
PS. How do I upload a video as a reply?