A PROJECT REPORT ON “STUDY OF HOME LOAN”
AT LIC HOUSING FINANCE LTD. AREA OFFICE PIMPRI
BY Mr. YASHWANTRAO PANDURANG LAVATE UNDER THE GUIDANCE OF PROF. S. P. DINGRE
SUBMITTED TO
“SAVITRIBAI PHULE UNIVERSITY OF PUNE”
IN PARTIAL FULFILMENT OF THE REQUIREMENT FOR THE AWARD OF THE DEGREE OF MASTER OF BUSINESS ADMINISTRATION (MBA) THROUGH
AUDYOGIK SHIKSHAN MANDAL’s
INSTITUTES OF BUSINESS MANAGEMENT & RESEARCH (I.B.M.R), CHINCHWAD, PUNE. 411019. 411019 . 2013-2015
DECLARATION
I YASHWANTRAO PANDURANG LAVATE, a student of MBA (2013-2015) hereby declare that the, project report entitled “STUDY OF HOME LOANS ”
is the authentic work done by me at LIC HOUSING FINANCE LTD, PIMPRI, PUNE
Report is submitted in partial fulfillment of the requirement of the award of Master of Business Administration (M.B.A.) degree abide by Savitribai Phule Pune University rules.
Yashwantrao Pandurang Lavate MBA (Finance Management) ASM’s IBMR Chinchwad, Pune.
DECLARATION
I YASHWANTRAO PANDURANG LAVATE, a student of MBA (2013-2015) hereby declare that the, project report entitled “STUDY OF HOME LOANS ”
is the authentic work done by me at LIC HOUSING FINANCE LTD, PIMPRI, PUNE
Report is submitted in partial fulfillment of the requirement of the award of Master of Business Administration (M.B.A.) degree abide by Savitribai Phule Pune University rules.
Yashwantrao Pandurang Lavate MBA (Finance Management) ASM’s IBMR Chinchwad, Pune.
ACKNOWLEDGEMENT
Devotion is important, knowledge is important, but this knowledge, devotion will be fruitless if these factors are put in the wrong direction. So we desperately need a guide to make our way clear in foggy situations. I have utilized this valuable suggestion in making my report attractive and accurate. I am greatly indebted to all those, whose suggestion has formed the bases of this report. Firstly I would like to thank Mr. SHYAM GOWANE (Area Manager) LIC HOUSING FINANCE LTD, PIMPRI, PUNE, for giving me the opportunity to work on this project.
Further, I extend my thanks to Mr. PANKAJ KORANE (Senior Associate) LIC HOUSING FINANCE LTD, PIMPRI, PUNE, for being the source of inspiration and
guidance to me. It was their help and cooperation, which made me complete m y project. I am highly indebted to Ms. Sunita Sharma (Managing Director & Chief Executive Officer) & Mr. S. K. Roy (Chairman) for his invaluable cooperation and his unending
support, for guiding me at every step. Finally I would like thank to all respondent for their helpful criticism and useful suggestions, which contributed towards successful completion of my project.
Yashwantrao Pandurang Lavate MBA (Finance Management) ASM’s IBMR, Chinchwad, Pune
INDEX
SR.NO.
CHAPTER
PAGE. No.
1
Executive Summary
1
2
Industry Profile & Organization Profile
3
3
Outline of Task
22
4
Research Methodology & Data Analysis & Interpretation
24
5
Activity Chart
47
6
Key Learning
49
7
Contribution to organization
51
8
Questionnaires & Web Sites Details
53
LIST OF TABLE
SR.NO.
Table Name
PAGE. No.
1
Rate of Interest
18
2
EMI Chart
21
3
Personal Discussion Format
35
4
Calculation Sheet Format
37
5
Basic Eligibility Chart
38
6
Basic Eligibility Chart
38
7
Basic Eligibility Chart
38
8
Business Incomes
39
9
Income from other Source Table
39
10
Ages Group
40
11
Annual Income
41
12
Own Property
42
13
Types of Property
43
14
Budget
44
15
Home Loan
45
16
Preferred Option Chart
46
17
Work Plan
48
LIST OF GRAPH
SR.NO.
Graph Name
PAGE. No.
1
Ages Group
40
2
Annual Income
41
3
Own Property
42
4
Types of Property
43
5
Budget
44
6
Home Loan
45
7
Preferred Option Chart
46
Chapter No 1
EXECUTIVE SUMMARY
EXECUTIVE SUMMARY
As a part of the Curriculum of the MBA Programme of the SAVITRIBAI PHULE PUNE UNIVERSITY. I underwent my summer Training for the Period of TWO Months at LIC HOUSING FINANCE LTD, Pimpri, Pune. The aim behind is to let the Students draw out the Difference & Similarities between the theoretical knowledge with the actual Job conditions, so they can be able to Pursue & Cultivate Strategic decisions making capabilities & establish themselves as capable Managers of tomorrow. Each management student learns a lot during his two years of MBA program. The (summer) project provides required practical training to student and gain the practical knowledge of the topics learned in classroom and to find its relation with the real market scenario. Someone has greatly said that practical knowledge is far better than classroom teaching. During this project I fully realized this and come to know about the present real world of home loan sector. It includes all the activities involved in providing home loan products to the final customers. I am pleased to know about the consumers’ wants and competitors activities in the real world of home loan sector. The subject of my study is to analyse the present home loan sector and products offered by LIC by applying various tools like cold calling and through direct interaction with customer’s. I have also done research on the customer reaction, age group taken loan, property types, and different preferred option. his chosen LIC housing finance & private home loan companies. The report contains first of all brief introduction about the company. I also put forward recommendations of the consumers and conclusions that will help LIC to provide consumer satisfactor y services in the home loan sector. The project gives the live experience about the various aspects of the management that is help full from future point of view. The project provides the opportunity to understand the organization very closely.
Chapter No 2
INDUSTRY PROFILE & ORGANIZATION PROFILE
2.1 INTRODUCTION The purchase or sale of a home or investment property is not only one of the most important financial events in peoples’ lives, but also one of the most complex transactions. As a result, people usually seek the help of real estate agents and brokers when buying or selling real estate. Real estate agents and brokers have a thorough knowledge of the real estate market in their community. They know which neighbourhoods will best fit clients’ needs and budgets. They are familiar with local zoning and tax laws, and know where to obtain financing. Agents and brokers also act as an intermediary in price negotiations between buyers and sellers. Real estate agents are usually independent sales workers who provide their services to a licensed broker on a contract basis. In return, the broker pays the agent a portion of the commission earned from the agent’s sale of the property. Property Service Division of LIC Housing Finance Limited deals with the same business of real estate. The need of entering in this field was felt by LIC Housing Finance Ltd due to increasing prospects in Real Estate business. There are many big brands namely ICICI realty, HDFC Realty, Axis Bank Realty etc. A new line of business by the name Property services Division is being launched across the country in selected centres. The function of the Property services Division includes all activities involved in enabling a prospective homebuyer select the property up to taking the possession of the same. It is thus conceived to be a one-st opshop for all the advisory services related to the above. Property services division, which offers investors and builders a single transparent platform to buy/sell office and commercial spaces and residential apartments/flats. This Year LIC Housing Finance Celebrate on 25 th Anniversary on This Year 19th June 2014. This Enjoy on All over India Celebration.
2.2 MEANING OF HOUSING FINANCE The term housing finance is commonly referred to t he loans availed by a household for the purchase or construction of a housing unit. It involves mortgaging of the property as collateral against which the loan has been taken. Originally, a mortgage was said to have occurred when the owner pledged her right over an asset owned by her as a security with the lender for availing a loan. However, as housing loans are given under the condition of mortgaging the property for which the loan has been availed, the term mortgage finance has become synonymous to housing finance. Housing finance covers a wide range of issues, and the concept often varies in its coverage across different countries; however, it has been defined mainly in terms of residential mortgage credit. “Boleat (1985) for instance describes housing finance in terms of the flow of funds to home buyers”. “According to Lea (2000) housing finance includes a broad array of institutional arrangements which include both general and specialized institutions acting as primary or secondary lenders, with the common purpose of channelling funds from savers to households demanding housing loans”. “Warnock and Warnock (2007) describe housing finance as the provision of long-term financing for house purchase”. “King (2009) refers to housing finance as the funds used for building and maintaining the housing stock of a country”. “Chiquier and Lea (2009) look at housing finance as a link between multi-sector issues which are in a continuous process of change on account of the economic, cultural, and regulatory environment of a country”. They consider housing finance as encompassing more than residential mortgage credit and include housing developer finance, rental finance as well as housing related microfinance within the scope of the term housing finance. Housing finance covers a wide range of issues, and the concept often varies in its coverage across different countries; however, it has been defined mainly in terms of residential mortgage credit.
2.3 History of LIC Housing Finance
Launched in 1989 as per Companies Act, 1956 LIC housing finance has grown to be
one of the largest lender in home-finance market
Promoted by LIC that helped in initial business functions. Finally after being promoted as a company offering housing finance by LIC it went public in 1994.
LIC Housing Finance news state that its authorized capital stands at Rs.150 crores or Rs.150 million.
Its shares are trade only in dematerialized form at both NSE and BSE.
The company’s GDR was launched in 2004 and is listed on the Luxembourg Stock Exchange.
Presently, according to Lic housing finance news there are over 181 marketing units; along with a wide network of 6 regional offices and over 13 back-offices, 773 direct sales agents (DSA), 3400 home loan agents (HLAs) and 615 customer relationship associates.
The Company has set up a Representative Office in Dubai and Kuwait to cater to the Non – Resident Indians in the GLCC countries covering Bahrain, Dubai, Kuwait, Qatar and Saudi Arabia. Today the Company has a proud group of over 10,00,000 prudent house owners who have enjoyed the Company's financial assistance. 1989 - The Company was incorporated on 19th June as a public limited company. It
was promoted by LIC of India. The Company provide housing loans to individuals, builders, development authorities, employers organisation etc. - The Company has started various schemes: Griha Prakash a general scheme, Griha Tara under which it accepts only Bima Sandesh Plan as Life Insurance Corporation, Griha Shobha for NRIs and Griha Lakshmi for people to have a second house. 1994 - 30,057,900 No. of equity shares were issued at a premium of Rs 50/- per share
through public issue on 15th November 1994. The allotment was as follows; 1,082,000 shares to LIC on firm allotment basis and the balance 189,75,900 shares to public (all were taken up). 1996- The Company has decided to carry out fund based and one-fund based
activities, viz., debt securitisation, lease and hire purchase, renting of properties and giving guarantee to co-operate bodies.
2000- Crisil has assigned a AAA rating to the issue of mortgage backed
pass
through certificate backed by mortgages orginated by the company. 2001 - The Company has launched its new scheme, Griha Vikas. 2002 - LIC Housing Finance Ltd has informed BSE that the Company has forfeited
1,25,300 equity shares due to non payment of allotment/call monies. -LIC Housing Finance has approved for the take over of Individual Housing loan portfolio of GLFL Housing Finance. -Around 25 investors subscribed to the issue of confidentially placed debentures for a total amount of Rs.392 cr of LIC Housing Finance Ltd. -LIC Housing Finance Ltd has decreased its interest rates on housing loans by 25-50 basis points. -Financial Institutions have increased their stake from 0.01% to 1.96% and Mutual Fund companies have increased their stake from 0.35% to 1.06% in LIC Housing Finance. -LIC Housing Finance Ltd has decreased the floating rate of interest
under
individual loan scheme to 9.5% from 11%. -LIC Housing Financee signed a deed of assignment to take over individual housing loan portfolio of Citibank N A. -UTI and IFCI has been removed from the list of promoters of LIC
Housing
Finance. 2003 - LIC Housing Finance has unveiled a new project for elderly people called
'LIC HFL Care Homes' . -LIC Housing Finance Ltd has sanctioned 84,126 loans worth Rs.3265.78cr and disbursed 76,663 loans worth Rs.2941.24cr under its Individual Loan Scheme. -LICHFL has mobilised Rs.280cr for 15 years at 7% rate of interest through private placement. -Lic Housing Finance Ltd has informed that the shares of the company have been delisted from The Stock Exchange - Ahmedabad w.e.f December 08, 2003. 2004 -Merill Lynch Capitat acquires LIC housing stake of 0.39%
-Templeton Asset Management buys 37,52,362 equity shares, representing 5.01% of LIC Housing's total paid-up capital of Rs 74.9 crore -LIC Housing Finance Ltd has informed that the shares of the Company has been voluntarily delisted from the Delhi Stock Exchange (DSE) W.E.F. January 23, 2004. -LIC Housing Finance shares delisted from Madras Stock Exchange
-Mr D Krishnan appointed as Chief Executive Officer - LIC Housing Finance Ltd's (LICHFL) one-crore global depository receipts (GDR) issue opened on August 27. - Lists its maiden global offerings worth .85 million at the
Luxembourg Stock
Exchange successfully. -Introduces new product that starts as a fixed rate loan but contains an option to convert it to a Floating rate loan at the end of five years, at the then prevailing rate. 2005 -Delist from The Calcutta Stock Exchange Association Ltd (CSE) with effect
from December 09, 2004. -LIC Housing Finance launches loan product that eliminates the requirement of charge on house financed. -Goldman Sachs acquires share in LICHFL 2007- LIC Housing Finance to launch FD scheme
-LIC Housing Finance to enter
into reverse mortgage product. 2008 -LIC Housing Finance Ltd has informed that the Board has appointed the
following persons as Directors on the Board of the Company on May 20, 2008 -Name of the Director: Shri. D K Mehrotra For the Position of : Managing Director Change effective from: May 20, 2008. - LIC Housing Finance Ltd has informed that the Board of Directors of the Company has appointed following person as Director on the Board of the Company on July 01, 2008. - Name of the Director: Shri A S Narayanamoorthy - For the position of: Additional Director - Change effective from: July 02, 2008 -LIC Housing Finance launches Reverse Mortgage for senior citizens 2009 - LIC Housing Finance cut interest rates for new loans by 0.5% where for
customers opting for floating rate loans between Rs 30 lakh and Rs 75 lakh, the new rates will be 8.755 against 9.25%. 2010 - The Company is applying for a license with the Pension Fund Regulatory
Development Authority (PFRDA) to act as Aggregator under
the, National pension
System (NPS) – Lite. - LIC Housing Finance Ltd has decided to unveil a private equity fund focussed on real estate development projects. - LIC Housing Finance on October 27 has approved a stock split in the ratio of 1:5 to
boost the liquidity of its scrip. -Company has splits its Face value of Shares from Rs 10 to Rs 2 2011 - Dinesh Kumar Mehrotra, Managing Director for international operations in
LIC, was appointed interim Chairman. 2012 - LIC Housing Finance has said that it has begun the process of raising funds
through Qualified Institutional Placements (QIPs). th
2014 - 19-06-2014 25 year completed
- LIC housing finance Last 25 year Rs. 139000 Crore in Home Loan disbursement - They are 11000 Representatives helping Indians own homes over the last 25 years -They are more than 16.8 lakhs Families own homes with our support over the last 25 year.
2.4 Company Profile LIC Housing Finance Ltd is one of the largest Housing Finance Company in India. The company is engaged in the business of providing loans for purchase construction, repairs and renovation of houses/flats to individuals, corporate bodies, builders and co-operative housing societies and has its operations within India. They provide loans for homes, construction activities, its corporate housing schemes. Around 89% of the loan portfolio derived from the retail segment and the rest from large corporate clients. The main objective of the company is providing long term finance to individuals for purchase / construction / repair and renovation of new / existing (Resale) flats / houses. The company also provides finance on existing property for business / personal needs and gives loans to professionals for purchase / construction of Clinics / Nursing Homes / Diagnostic Centres / Office Space and also for purchase of equipments. The company through their subsidiaries LICHFL Care Homes Limited, is engaged in the business of setting up, running and maintaining assisted living community centre/care homes for senior citizens; LICHFL Financial Services Ltd, is engaged in the business of marketing various financial products and services, and LICHFL Asset Management Company Ltd is engaged in business of managing, advising, administering mutual funds, unit trusts, investment trusts and to act as financial and investment advisors and render financial advisory services. The company possesses one of the industry's most extensive marketing network in India. The company is having their registered and corporate office at Mumbai. They have 7 regional offices, 13 back offices and 190 marketing units across India. In addition the company has appointed over 1241 direct sales agents (DSAs), 6535 home loan agents (HLAs) and 782 customer relationship associates (CRAs) to extend their marketing reach. They have set up a representative office in Dubai and Kuwait to cater to the non-resident Indians in the GLCC countries covering Bahrain, Dubai, Kuwait, Qatar and Saudi Arabia. LIC Housing Finance Ltd was incorporated on June 19 1989. The company was promoted by LIC of India and went public in the year 1994. The company is recognized by National Housing Bank and listed on the National Stock Exchange (NSE) & Bombay Stock Exchange Limited (BSE) and its shares are traded only in Demat format. The GDR's are listed on the Luxembourg Stock Exchange. In the period of 2001, the company launched their new scheme called Griha Vikas. In the year 2002, the company signed a deed of assignment to take over individual housing loan portfolio of Citibank. In the year 2003, they unveiled a new project for elderly people called LICHFL Care Homes. The company launched their maiden GDR issue in the year 2004. Also, they introduced flexi-fixed scheme offering fixed rate of interest for first five years and variable thereafter. In October 2005, the company started offering of 'New Griha Laxmi' for woman special housing loans against the security of certain approved financial assets like Bank Fixed Deposits, National Savings Certificates and Life Insurance Policies. In the year 2006, the company introduced new Griha Jestha for senior citizens for buying unit of LICHFL Care Homes Ltd. In May 2007, the company launched maiden Fixed Deposit Scheme. In October 31, 2007, the company incorporated LICHFL Financial Services Ltd for undertaking non fund based activities like marketing of housing loans, insurance products, credit card, mutual fund, personal loan etc. In February 2008, they launched reverse mortgage for senior citizens above 60 years of age. In February 14, 2008, the company incorporated LICHFL Asset Management Company
Private Limited for undertaking the business of managing, advising, administering venture funds, unit trust, investment trust in India as well as abroad. In March 5, 2008, the company incorporated LICHFL Trustee Company Private Limited for undertaking the business of trustees of venture capital trust, funds - in India and offshore fund. In March 12, 2008, they launched a new venture capital fund for realty projects. During the year 2009-10, the company was awarded the 'Second Best Home Loan Provider' award by Outlook Profit. During the year 2010-11, the company launched a unique interest rate scheme namely; 'MINI 5' to cater to housing finance needs of the priority sector population residing in Tier II and Tier III cities. Now LIC Housing Lunch New Scheme “Griha Prakash”
2.5 Board of Directors of the Company Mr. S. K. Roy Ms. Sunita Sharma Mr. K. Narasimha Murthy Mr. S. Ravi Mr. B.N. Shukla Mr. JagdishCapoor Ms. Savita Singh Mr. T. V. Rao
Chairman Managing Director & Chief Executive Officer Independent Director Independent Director Independent Director Independent Director Independent Director Independent Director
2.6 Senior Executives of the Company
Mr. Nitin K. Jage Mr. Ajith Kumar L Mr. N. K. Mittal Mr. L. C. Meena Mr. S. T. Samtani Mr. P. Shekhar Mr. P. Narayanan Mr. S. R. Sharma Mr. Venkatasubramanian B Mr. Pardaman Singh Mr. N. Mahesh
General Manager (Taxation) & Company Secretary General Manager (Marketing - Corporates & Project, CRM and Legal) General Manager (Chief Financial Officer) General Manager (Marketing - Retail) General Manager (PD & Treasury)r General Manager (IT) General Manager (Accounts) Chief Manager (HR/OS/Estates) Chief Manager (Audit) Chief Manager (CRM) Associate Chief Manager (Recoveries, PR, Publicity & Market Research)
2.7 Area Offices Pimpri Address LIC housing Finance Ltd Office No 17-20, 3rd Floor, B Wing Kamala Cross Road Building Opp. PCMC Building, Pimpri, Pune 18
2.8 Pimpri Area Office Staff SR No 1 2 3 4 5 6
Name Shyam Gowane Vikrant More Pankaj Koranne Ajit Gaikwad Dipthi Tapswi Babanrao Agalave
Post
Area Manager Assistant Manager Senior Associate Assistant. Associate. Assistant.
2.9 Various Products Offered By LIC Housing Finance: As per various LIC Housing Finance news, there are many products that are offered by the company ever since it was launched way back in the year 1989. These include both deposits as well as advance schemes that work as tools of housing finance by LIC:
2.10 Reasons for Home Loans: To own a home is everyone's dream. From a single room to multi-storeyed apartments, private villas, holiday homes, second homes - the Housing market is well developed in most towns. Home loans help you realize your own home dream, even when you are young. We help you plan your dream home as you start your working life, by offering various options of easy instalments, Income Tax benefits and more . . . Loans: Loans are offered as per different target groups of consumers. Thus, there are
LIC housing finance schemes offered as loans according to different borrowercategory, such as: i) Corporate loans ii) Loans meant specifically for builders as well as real estate developers
iii) Home-loans iv) Loans aimed at professionals Deposit schemes: Deposit schemes were first launched by the company on 10th May
2007 and may be accepted as both cumulative as well as non-cumulative deposit schemes. Terms of deposit may range from 1 year; 18 months; 2 years; 3 years as well as 5 years. Interest under non-cumulative deposit schemes would be distributed twice a year; whereas interest on cumulative deposit schemes would be calculated as per biannually compounding. Loans: Housing Finance By LIC :
Loan-schemes available with lic housing finance are customized to suit varied requirements as per individual borrower-profile. As per official website and Lic Housing Finance news following loans are available: Home loans: Are offered at easy rates to both residents as well as non-resident
Indians. Step-up facility in terms of amount of EMI amount is also available for those who wish to opt for a steady increase in their repayment capacity during tenure if loan. Corporate loans: Aimed at corporate employees who have been approved by LIC
and include employees of PSUs, reputed public as well as private limited companies Housing finance by LIC loans to professionals : Aimed at non-salaried
professionals.
Taking a home loan is a major decision, involving a large investment. Though the availability of easy financing, innovative products and other value-added services by Home Loan companies have made the home buying process relatively easy, for a customer it is still a challenge to decide which home loan works best for him.
2.11 Subsidiary Companies 1. LICHFL Care Homes Limited To address the crying need of housing for the senior citizens of the country, the Company had promoted LICHFL Care Homes Limited, to establish and operate assisted community living centres. LICHFL Care Homes Limited was incorporate on 11th September, 2001. It launched its eco-friendly pilot project in Bangalore with cost-effective independent cottages and all other on-campus amenities, fully structured and self-contained to address every possible need of residents. It has library, community centre, home theatre, meditation centre, and doctors on call and ambulance to take the ailing to the nearest city Medicare centre-all that would make the lives of senior citizens comfortable and satisfying. New such projects are planned in Bhubaneshwar and Jaipur and the company is in the process of finalising the purchase of land for a few more projects
2. LICHFL Financial Services Limited LICHFL Financial Services Limited was incorporated on 31st October, 2007 for undertaking non fund based activities like marketing of housing loans, insurance products, credit card, mutual fund, personal loan etc. It has become operational in 2008-09 and has already opened five offices in Maharashtra and plans to open atleast another thirty offices during 2009-10.
3. LICHFL Trustee Company Private Limited LICHFL Trustee Company Private Limited was incorporated on 5th March, 2008 for undertaking the business of trustees of venture capital trust, funds-in India and offshore fund. The Company would very soon launch its operations - act as trustee of the fund rais ed through private placement, public offer etc.
4. LICHFL Asset Management Company Private Limited LICHFL Asset Management Company Private Limited was incorporated on 14th February, 2008for undertaking the business of managing, advising, administe ring venture funds, unit trust, investment trust in India as well as abroad. The Company would launch its operations very soon.
2.12 OBJECTIVE OF THE STUDY
To Study of the process of Home Loan.
Document Required for Loan Sanction.
Document Required For Loan Disbursement.
Processing fees paid by customer for the processin g of the home loan proposal.
To study the process of Customer Verification
To Study the process of Calculation of Loan Disbursement on Property
2.13 Types of Home Loans The two most widely used types of home loans are fixed-rate l oans and adjustable rate loans. A fixed-rate loan keeps the same interest rate for the life of the loan, which means that the principal and interest portions of the monthly payment stay the same. Adjustable-rate mortgages begin with a lower interest rate for the first few years and then adjust to market rates after the initial period is over. Caps are placed on how much the r ate can adjust at any given time, as well as on how much the rate can increase over the duration of loan. This means the principal and interest portions of the monthl y payment change repeatedly through the duration of loan. There are different types of home loans tailored to meet our needs. Here is a list of few: Housing Loans: This is the basic home loan for the purchase of a new home. Improvement Housing Loans: These loans are given for implementing repair works and renovations in a home that has already been purchased. Construction Loan: This loan is available for the construction of a new home. Extension Loan: This is given for expanding or extending an existing home. For eg: addition of an extra room etc.
Home Conversion Loan: This is available for those who have financed the present home with a home loan and wish to purchase and move to another home for which some extra funds are required. Through home conversion loan, the existing loan is transferred to the new home including the extra amount required, eliminating the need of pre-payment of the previous loan. Land Purchase Loans: This loan is available for purchase of land for either construction or investment purposes. Bridge Loans: Bridge loans are designed for people who wish to sell the existing home and purchase another one. The bridge loans help finance the new home, until a buyer is found for the home.
2.14 Processing Fees & Stamp Duty
Up to 50 Lacs Lacs 10500/- + Services Tax ( Including Including Cersai Charges ) Beyound 50 50 Lacs 15500/- + Services Tax (Including Cersai Charges ) Intimention of Mortage 2000 to 2500 ( If Manual 2500 & Online 2000 ) Memorandum of Deposit of Title Deeds ( If 0.2 % Loan amount stamp paid by sub registrar Duty & Stamp Paper Loan agreement 300/- Stamp paper Affidavite Sum Undertaking 100/- Stamp paper Power of attorney 500/- Stamp Paper
2.15 Rate of Interest Scheme
ROI
Fix For
Celebration 25
10.10 %
2 Years
Super Fix
12.25 %
Full Term
( Up to 3 Crores) 75 Lacs
New Fixed 10
10 Years
Get Sanction Letter Before You Finalised Your Property Tenor up to 30 Years* Higher Loan Amount Eligibility Monthly Reducing Balance Easy & Simple Documentation No Required - Guarantor & Insurance Product Maximum Funding 85 % (up to 20 lac) & 80 % (above 20 lac)
Features
11.75 %
Special Features
11.25 %
>75 Lacs
Home Loan Loan against Property Balance Transfer + Top Up Both Fixed & Floating Rates Available Best Housing Finance Company in Country Awarded by CNBC TV18 Housing Finance Expertise of more than 20 years.
Fees On Prepayment
Nil if paid from own sources else 2.00% on the Amount of loan prepaid + Service Tax applicable
2.16 Home Loan Procedure With the increasing competition in the market for offer ing Home Loans, the otherwise tedious process of availing loans has gone a tremendous change in the recent years. However, there is still some s ome process involved in the procurement of Home loan. It is advisable for borrower to first look at the different stages required for obtaining a Home Loan. Loan. Here is step by step procedure of procuring home loan. Step 1 : Application form
The first step involved in applying for home loan is the procurement of application form from the HFC of applicant’s choice. The Performa of application every HFC (Housing Finance Companies) is different from the other but about 80% information required to be furnished is the same. Along with the application form necessary documents like address proof, age proof, proof of income, bank balance etc. are also to be attached with the application form before it is submitted to the HFC. Along with all these documents HFCs also ask for processing fee of the home loan that varies 0.25% to 0.50% of the total loan amount. Step 2 : Personal Discussion
After successfully filling the application form and submitting it to the authority the next step is face to face with bank or HFC where you have applied for the home loan. The bank first evaluates the papers submitted and summons the applicant for the personal discussion regarding the home loan applied for. Step 3: Bank's Field Investigation
The next step is the field investigation done by the HFC or banks. They send representatives to the existing residence of the applicants or their offices for the validation of the documents submitted. This is the essential part for the banks to establish the trust with the applicants. Step 4: Credit appraisal by the bank and loan sanction(CIBIL) sanction(CIBIL)
This is the make or break stage of the process. The bank or HFC will establishes repayment capacity based on applicant’s income, age, qualifications, experience, employer, nature of business etc. to access credential. The bank can refuse loan application if any discrepancy is found at this stage. But if everything goes according to the conditions negotiated by the parties then the bank or HFC sanction the loan l oan that may be unconditional or with some conditions levied. Step 5: Offer Letter
After the sanction of the Home Loan, the applicant gets offer letter from the bank or HFC with the following details. Loan amount, Rate of Interest, fixed or variable ROI, Tenure of the loan, Mode of repayment General terms and conditions of the loan, Special conditions conditions etc. If the terms and conditions are agreed the applicant has to sign the duplicate copy of the offer letter and that is to t o be submitted to the Bank or HEC.
Step 6: Submission of legal documents & legal check
The bank or the HFC now asks for the legal documents of the property involved for applying home loan. All the legal documents of the property involved have to be submitted. The bank does all the llegal egal checks on the property. The documents remain wit h the bank until the repayment of the Home loan. Step 7: Technical / Valuation check
The Banks or HFC then go about the technical valuation of the property. The experts of the bank visit the site si te to t o be purchased and value it as per the existing rules and a nd regulations. The valuation of the property is the most important aspect that the bank considers before financing any property. Step 8: Registration of property documents
After the legal and technical valuation of the property the draft documents has to be cleared by the lawyer and stamping and registration of the documents is needed. Step 9: Signing of agreements and submitting post-dated cheques
Now it is time of signing the final agreement of the home loan. After the signing of the agreement a bunch of Post-dated cheques are to be submitted as agreed on the agreement. It is time for the final Disbursement of the Home Loan. After the bank or HFC
Step 10: Disbursement
It is time for the final Disbursement of the Home Loan. After the bank or HFC ensures financing the property is involves no risk they pay the final amount that is agreed upon. The mode of payment varies from full to part payment. In the case of under construction property the mode is part payment and in the case of ready possession properties disbarment is full and final.
2.17 E.M.I Chart (for 1 lac)
Term 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30
Celebration 25 10.1 8797 4620 3232 2542 2130 1858 1666 1523 1414 1328 1258 1201 1154 1115 1081 1053 1028 1007 988 972 958 946 935 925 916 909 902 896 890 885
New Fix 10 11.25 8850 4673 3286 2597 2187 1917 1726 1885 1477 1392 1324 1269 1223 1185 1153 1126 1102 1082 1065 1050 1037 1025 1015 1006 999 992 986 981 976 972
New Fix 10 11.75 8874 4696 3310 2622 2212 1943 1752 1612 1505 1421 1354 1299 1250 1216 1185 1168 1135 1116 1099 1084 1072 1061 1051 1043 1035 1029 1023 1018 1014 1010
Sure Fix 12.25 8897 4720 3334 2646 2238 1969 1779 1640 1533 1450 1383 1329 1285 1248 1217 1191 1168 1149 1133 1119 1107 1096 1087 1079 1072 1066 1061 1056 1052 1048
GV 12.50 8909 4731 3346 2659 2250 1982 1793 1653 1547 1464 1398 1344 1300 1264 1233 1207 1185 1167 1150 1137 1125 1114 1105 1098 1091 1085 1080 1075 1071 1068
Chapter No 3 OUTLINE OF TASK
Outline of Task 1) Risk of default should be reduced by funding the right customer, by using various tools of appraising like CIBIL Report, Field Investigation. 2) Exiting Loan (If already & any loan taken Loan) Track Record needed to LIC housing loan process & Loan approval 3) To find out the customer profile of the Home loan applicants. 4) Most of the Customer prefers LIC Housing Finance Ltd because of its service.
Chapter No 4 RESEARCH METHODOLOGY & DATA ANALYSIS & INTERPRETATION
4.1 Research Methodology Research Methodology is a way to systematically solve the research problem. It may be understood as a science of studying now research is done systematically. In that various steps, those are generally adopted by a researcher in studying his problem along with the logic behind them. Data collection is important step in any project and success of any project will be largely depend upon now much accurate you will be able to collect and how much time, money and effort will be required to collect that necessary data, this is also important step. Data collection plays an important role in research work. Without proper data available for analysis you cannot do the research work accurately. There are two types of data collection methods available. Redman and Mory define research as a “systemized effort to gain new knowledge.” Some people consider as movement a movement from the known to the unknown it is actually a voyage of discovery
1) Data Sources:In the Preparation of this project it is necessity to collect the Primary data and Secondary data
2) Primary data: The information about the Company is gathered from the discussion with the employees/staff. Basically I was use primary data for that project
3) Secondary data:The secondary data collected The balance sheets as on the date of 31st March 2013 for the period of 1st April 2012 to 31 st March 2013
4) Sample size:Five cases of Home Loan Proposal are to be studied for understanding of the appraisal of home loan. Data collected through survey of procedure, service, etc. provided by LIC Housing Finance Ltd by filling questionnaire of fifty & above LIC Housing Ltd Customer
The methodology of this study has been adopted on the following basis:
Study of various Journals, Notes & Books.
Collection of Primary & Secondary data records of the organization.
Analysis of the collected data for its application.
4.2 Home Loans Two Stages The housing finance cycle at LIC Housing Finance Ltd is of two stages, both are important and play a vital role in fulfilling the requirements of housing finance institution. The two stages are as under1. Sanction stage. 2. Disbursement stage .
1. Sanction stage. It is a stage where the customer get sanction or approval that he is eligible to take a loan of specific amount calculated on the basis of his income from LIC Housing Finance Ltd. 2. Disbursement stage. It is a stage where the cheque of sanctioned amount is handover to the customer or concerned person.
3.2.1 Sanction stage A. B. C. D. E. F. G. H.
Generation of leads/Sourcing of business. Contact & collection of documents from customer. Completion of documents. Field investigation report. Verification of relationship officer. Personal discussion. Final approval or rejection by the branch credit manager. Sanction letter delivered to the customer.
A. Generation of leads/Sourcing of business:This is an important step in the housing finance cycle to keep the organization moving successfully. It is essential to generate cases to credit LIC HFL uses methods to source business & generate leads1. Mail. 2. Walk-in interview. 3. Telephone enquiry. 4. Customer reference. 5. Approved project file.
B. Contact & collection of documents from customer :Once the lead has been sourced the sales officer contact him & give him a list of documents long with other corresponding information. When the documents are handed over to sales officer, he submit documents along with the application form to LIC Housing Finance Ltd. Sales officer gives an idea a bout how much loan can customer avail as per his income.
C. Completion of documents:The document have been collected by the sales officer hand over to the back office executive, executive then complete documents in special file provided for LIC Housing Finance Ltd in accordance with the requirement of LIC Housing Finance Ltd.
D. Field investigation report:After completing the documents the back office executive ties the field investigation report with the data compiled from the file before moving it on the next stage.
E. Verification by sales manager :After completion of documents and filing of it, the documents are handed over to the Sales manager, who verifies the documents to check for loan analysis the strength and weakness of a case, the loan eligibility & the requirement of additional documents. The sales manager act as a filter allowing good case to flow through for final approval while do not fit, into the polices of LIC Housing Finance Ltd. Sales manager make signature if the case fit into policies of the bank.
F. Personal discussion :PD is an important stage in sanction process. a s per norms loan amount is decided on the basis of documentation but the customer knowledge, his behaviour can be decided on the basis of PD with him. It helps to judge the credit worth ness of applicant which helps organization in future. Sales manager make signature if the case fit into policies of the bank.
G. Final approval or rejection by the branch credit manager:The file is send to the branch credit manager for final approval. after checking the file branch credit manager take final decision of approval or rejection of the case. If the case is rejected the documents are returned to the customer & if the case is approved then it goes to the next step.
H. Sanction letter delivered to the customer:This is the final step in sanction process after receiving the sanction letter it hand over the sanction letter to customer along with a list of legal documents required for the next stage i.e. disbursement stage.
3.2.2 Disbursement Stage A. B. C. D. E. F.
Collection of legal documents. Completion of documents. Legal appraised. Technical appraised. Final check by the BCM. Cheque disbursement.
A. Collection of legal documents:This is the first step towards the disbursement of cheque after sanction of the case. Already the sales officer collect the legal document from the customer in case of self construction & or collect it from the builder from whom the customer is purchasing the property
.
B. Completion of documents:Once the documents are collected by the sales officer he hand it over to the back office executive for compilation the executive complete the documents and process. C. Legal Appraisal:The legal appraisal of a case is an important step & it done by lawyer specially appointed by LIC Housing Finance Ltd. The lawyer verify the documents to check if the title of the property is free & marketable from all obligation, other legal aspect is free from any fraud. once the documents have been verified he submit a legal report to LIC Housing Finance Ltd. The lawyer report is very essential without his approval no case is clear. In case of negative remark mentioned by the lawyer the case is being rejected. D. Technical Appraisal:The technical appraisal is a task in which an engineer specially appointed by LIC Housing Finance Ltd he visit the site and check the property and prepare a report and submit it to the bank. On the basis of the report the BCM takes his disbursement decision. 1. If the property is in accordance with the plans rules and regulations approved by NMC. 2. If there are any legal and unauthorized construction on the s ite. 3. If the owner of the property is the same as mentioned on the legal Documents. 4. The extract or stage of constructions. 5. The raw material etc. available on the site. 6. He checks to see the cost is being incurred on the property is equivalent to the Estimate shown by the customer. 7. He also Provide an estimated date of compilation of the property. 8. Checking the age and conciliation of the property in case of resale Property. E. Final cheque by the BCM:The BCM makes a final check of the documents before ta king his decision. If the case is clear then BCM send s the file to operational manager. F. Cheque disbursement:This is final step in the disbursement stage. The operation manager prepare the cheque along with the letter which is handed over to the sales officer who then five it to the customer. Disbursement of cheque is done in accordance with the stage of construction as reported by technical advisor.
The cheque is disbursed in two ways, 1. As a part disbursement. 2. Fully disbursement.
4.3 List of Document’s Required For Home Loan Sanction 4.3.1 Salaried Person 1) Application For Completed with 2 Photo Duly Filled in & Signed 2) ID Proof : Pan Card , Passport , Voter Card, Employer ID Card, & Driving License. 3) Residence Proof : Latest Telephone Bill, Bank Statement containing Address for last 6 month. Electricity Bill, Ration Card, Letter from Employer 4) Salary Slips For last 3 months with seal & Sign 5) Latest Form 16 with Seal & Sign 6) Copy of Appointment Letter with Latest CTC & Confirmation Letter 7) Original Bank Statement, Passbook of Salary A/c for Last 6 month with seal & Sign 8) Last Qualification Proof 9) Previous Employment Details if applicant is on Probation 10) LIC Insurance & other Insurance Policy Details if Any 11) Processing Fees Cheque 12) All Track Records for 24 months for existing Loans if any 13) All Document to be Self attested
4.3.2.Self Employed / Professional 1) Application For Completed with 2 Photo Duly Filled in & Signed 2) ID Proof : Pan Card, Passport, Voter Card & Driving License 3) Residence Proof : Latest Telephone Bill, Bank Statement containing Address for last 6 month. Electricity Bill, Ration Card. 4) Last 3 years ITRs ( SARAL, Computation of income, Balance Sheet, Profit & loss A/c, TDS Certificates ( If Applicable), Tax paid Challans. 5) In case of Partnership firm: ITRs for last 3 years &Partnership Firm. 6) In case of company: Audit Reports for last 3 years & MOA & AOA. 7) Bank Statement / Passbook of Current & SB A/C for last 6 months (update ) 8) Alternate Business Proof ( Shop Registration Certificate etc.) 9) Processing Fess Cheque 10) 26 AS for 3 years 11) IT Verification
4.3.3 In Case of Take Over 1. 2. 3. 4. 5. 6.
Outstanding Loan Quotation Repayment Track Record List of Document from Bank NOC for take over Copies of Property Agreement Sanction Plan copy ( Blue Print )
4.3.4 Non Residency Indian 1. Copy of Passport , Visa , Service Contract, Salary Slip ( all duly attested by Indian embassy | Notary | HFL Officials | Bank ) 2. GPA ( General Power of Attorney ~ in our format ( all duly attested by Indian embassy | Notary | HFL Officials | Bank ) 3. Bank Statement for past one year of recent employment 4. NRI Bank Statement for 6 months 5. See list of salaried Document # Above mentioned income document are required for the Co- applicant also if His / Her income is considered
4.4 List of Document for Disbursement 4.4.1 Post sanction/Legal documents. Post sanction is legal documents on the basis of which a cheque is disbursed to the customer. The only security that LIC HFL has against a loan in this legal documents & no deviation is usually allowed in legal document. These documents are sending to the lawyer who verifies before being accepted by LIC HFL. These are as f ollows: 1) Direct From Builder Case:
Agreement of Sale Sub Registrar Receipt No objection certificate from builder Own contribution receipt from builder 2) Direct from Registered Co-op Housing Society Ltd.:
Share Certificate Allotment Letter No Objection Certificate from Society Own contribution receipt from Society Copy of Society Bye Laws Society Registration Certificate Registered Agreement if not Original member 3) Own Construction Case:
Original Sale Deed with Registration Receipt. 7/12 Extract 6 D Extract NA Order Copy ULC Order Copy Latest Title Clearance Certificate Original Architect Estimate Commencement Certificate Prior Sale Deed with Original Reg. Receipt. 4) Resale Case:
Sale Deed/Agreement with Registration Receipt Previous Customers Sale Deed/Agreement with Registration Receipt Own Contribution Receipt NOC from Builder/Society Title Certificate
Share Certificate & Allotment Letter (if applicable) NA Order & NA Tax Receipt (Xerox) ULC (Xerox) 7/12 & 6-D Extract (Xerox) Commencement Certificate & Completion Certificate (Xerox) Society Registration Certificate & Bye-Laws (Xerox) Title Certificate (Xerox) Building Plan (Xerox) 5) MASTER FILE/LEGAL FILE:
Sale Deed/lease Deed/Gift Deed or Development Agreement/Power of Attorney/Partnership Deed NA order & ULC Commencement Certificate & Completion Building plan 7/12 Extract & 6-D Extract Title Certificate Society Registration Certificate Bye Laws Copy.
3.4.2 Analysis of Legal Documents
All owners of the property should be applicants
Check for cost of property and OCRs paid
Signature of the owners should match with the application form
Witness should sign the agreement
Priority and Non Priority documents to be collected as per legal report
NOC From builder/ society / development authority as the case may be
Own contribution receipts
Agreements
Current agreement must be registered
Stamp Duty receipt required
Registration receipt required
Stamp duty receipt and registration receipt amount to be added to cost of property and calculated as OCRs too.
NOC
NOC should be on the letterhead of the Society/ Builder / Development Authority
Should have the stamp of the society / Builder / Development Authority
Address should match as per the agreement, Flat No., Wing No. etc..
Should be as per the procedures and drafts for different transaction types.
Must be dated
Own Contribution Receipts
Must have a revenue stamp
Cash payments cannot be more than Rs.20000/-
Should give details of the property like flat No. etc
In case of refinance > Rs.1 lac
Builder case – Receipts from builder & debits in bank account
Resale – Agreement for sale / Sale deed to be registered before refinance
Property Norms:
Property should not be in negative area
Property should be within geographic limits
Property should be self contained
Maximum age of property less than 35 years at loan application
Loan tenor not to exceed residual age of the property
Minimum Built up area > 400 sq. ft
In case of row house of ground floor only
4.5 Personal Discussion (Salaried Persons) Name of the Applicant 1.
a) Name of the Employer Organization b) Designation c) No. of year in service with present employer
2.
a) Educational Qualification b) Name of University / Institute c) Year of Passing Out
3.
Past Experience – No. of Jobs changed Previous Employer 1 a) Name of Organization b) Designation c) No. of year in Service
4.
Previous Employer 2 a) Name of Organization b) Designation c) No. of year in Service
5.
Family Status a) Whether Spouse is Co- applicant? b) Whether Spouse is working? Salaried / Self – employed
6.
Details regarding existing Place of Residence a) Current Residence – Owned/ Rented/ Company Leased/ Parental b) No. of years staying at Current Residence c) In case of Company Leased Accommodation whether planning to shift to new Premises? If yes, Expected Sales Proceeds/ Rent d) In case of Second House, plans for existing property – whether existing Property will be Sold / Rented?
If yes, Expected Sales Proceeds /Rent 7.
Details of Saving / Investment a) Immovable Property / Bank FD / Savings Balance / NSC / KVP / Mutual Fund / Shares & Stocks / Bonds, PPF, Insurance Policies
8.
Complete Details of existing Loans / Liabilities provided in Application Form? Whether Application intends to close any of them?
9.
As per Applicant’s view, how much EMI can he pay to LICHFL
10.
a) Whether Property identified? b) Approximate Property Value c) Source of Margin Money
11.
Comment on end use of Money in case of Top-up Loan & Loan under Griha Vikas Scheme.
12.
Whether procedure for Sanction of Loan e.g. Verifications CIBIL explain to the Applicant?
4.6 Calculation Sheet of Loan on his Payment Format APPLICANT EARNING Particulars Amount ( P.M.) Basic Pay DA HRA Transport Allowance SPL Allowance Performance Allowance Medical Allowance LTA Education Allowance Variable ( Annual ) LTA PLI/ Bonus/ Incentive Medical Total Variable TOTAL EARNING ( A ) DEDUCTIONS Particulars Amount Provident Fund Professional Tax Income Tax Transport Canteen Loan 1 Loan 2 Loan 3 Loan 4 TOTAL DEDUCTION ( B) NET INCOME (A-B)
Applicants Age ( D ) Loan Term ( E ) Age + Term ( D+E ) Total Net Income Loan Amount EMI MLSC
4.7 Customer – Basic Eligibility Calculation. FOIR: Fixed Obligation to Income Ratio: Income Below 20000 to 25000
Applicable FOIR 50 %
25000 and Above
60 %
How we treat income from other sources? Source Agricultural income stated in ITR)
%Eligibility (As 50 % of average of last 2 years
Proof 3 years ITR’s and 7/12 extract or ownership document copy.
Rental Income
100% of average of last 2 03 ITR years Rental Income 100% of current rental Lease Agreement for 3 years income as per lease Agreement Rental Income 50 % of current rental income Leave & License agreement as per leave & License copy of current period Agreement LIC /Broker commission i.e. 50 % of new business & Certificate / original NSC, KVP, IVP postal 100% of renewal business commission slip of Cos. Interest / Dividend Income 50 % of average of last 2 03 years ITR’s years The agreement of the eligibility from other sources of income must not be more than 100 % of the agreement of the main salar y income. 1) Resident Indian – Salaried: ITEM CONSIDERATION REG.ITEMS (PAYSLIP) 100% HRA 100% PENSION INCOME 100% BONUS ANNUAL BENEFITS FIXED REIMBURSEMENTS VARIABLE ITEM
100% 50% 50% 50%
2) Self-Employed – Professional: For calculation purpose SEPs can be classified as per following pattern – a. Doctors b. Allopathic (MBBS plus) c. Other (BHMS, BUMS, (etc.) d. Others (CA, CWA, CS, Lawyer, Consultant etc) Methods Used 1. GPR Multiplier Method 2. Eligibility based on Net Profit
3) Resident Indian – SENP: Business Income Av. Net Profit (PAT) for last two years
Net Profit Depreciation
Add: Depreciation*
-------------Business Income Personal Income (Salary / Remuneration) (Av. For last two years) Personal Income Total Appraised Income
=
BI + PI
Income from other sources Type Agricultural Income
Eligibility 50%*
Proof ITRs
Rental Income Interest/Dividend Income
100%* 50%*
ITRs ITRs
*Average of the last two years amount Income from above sources should not exceed 50% of the Total Appraised Income
4.8 Data Analysis Table 1: Age Group
Percentage
25-35
45
35-50
35
50-60
15
Above 60
5
Total
100
Graph 1:
Age Group 5 15 45
25-35 35-50 50-60
35
Above 60
Analysis:
It was found that about 45% of people were between age group of 25-35, 35% were between 35-50, 15% were between 50-60 and 5% were above 60. Interpretation:
Thus we conclude that the average percentages of people in the above age groups showed interest in the survey of LIC HFL
Table 2:
Annual Income
Percentage
Below 2 lacs
2%
2-5 lacs
30%
5-10 lacs
65%
Above 10 lacs
3%
Total
100%
Graph 2:
Annual Income 100%
0% Below 2 lacs
2-5 lacs
Percentage 5-10 lacs
Percentage
Above 10 lacs
Analysis:
It was found that 2% of candidates are below 2 lacs. 30% are between 2-5 lakh. 65 % of are between 5-10 lakh. While only 3% are above 10 lakh.
Interpretation:
Therefore it can be conducted that maximum income group was found between 5-10 lacs.
Table 3:
Possess Property
Percentage
Yes
67%
No
33%
Total
100%
Graph 3:
Own property
33%
Yes No
Analysis:
67% of candidates possess their own property and 33% of candidates had no property.
Interpretation:
This shows that out of 100 respondents 67% had their own property while 33% had no property. 67% were not willing to invest or buy any property.
Table 4:
If yes, the type of property-
Type of Property
Percentage %
Residential
78
Commercial
18
Others
4 Total
100
Graph 4:
Type of Property 4 18
Residential Commercial 78
Others
Analysis:
It was found that 78% of the candidates preferred residential property. 18% wanted Commercial while only 4% of the respondents wanted other than residential and commercial property.
Interpretation:
Thus, it can be concluded that 78% of the respondents wants to invest in the property for living purpose. While 18% wants to derive their business with the help of that property.
Table 5: Budget 10-30 31-50 Above 50 Total
Percentage 69 21 10 100
Graph 5:
Budget 10 21 0-30 31-50 69
Above 50
Analysis:
69% have budget more than 50 lacs. 21% have between 31-50 and 10% have between 0-30 lakhs Interpretation:
Thus, it can be said that major respondents do not want to invest much to buy a property. As majority of the respondents are of middle class society. While there are only10% who belong to high class society can invest above 50 lakhs.
Table 6: Home Loan Yes No Can’t Say Total
Percentage 79 11 10 100
Graph 6:
Percentage 10 11 Yes No 79
Can’t Say
Analysis:
79% of respondents preferred home loan while 11% did not prefer loans. There were 10% of respondents who could not decide whether to take or not. Interpretation:
Major respondents wanted to buy a property over loan basis as mostl y respondents are service men. Those who did not prefer loan were businessmen.
Table 7:
Preferred Option SBI HDFC LICHFL ICICI AXIS PNBHFL CANARA ALLAHABAD Bank DHFL Total
Percentage 32 16 12 10 8 9 3 6 4 100
Graph 7:
3
SBI 4
6
32
9
HDFC LICHFL
8
ICICI AXIS 10 12
16
PNBHFL CANARA ALLAHABAD Bank DHFL
Analysis:
32% respondents preferred SBI. 16% preferred HDFC. 12% preferred LICHFL. 10% preferred ICICI. 8% preferred Axis. 9% preferred PNBHFL. 3% preferred Canara Bank. 6% preferred Allahabad Bank. 4% preferred DHFL. Interpretation:
Maximum proportion of respondents preferred to opt for SBI. This shows that most of them have faith in SBI. Next preference is to HDFC and then LICHFL.
Chapter No 5 ACTIVITY CHART
5.1 Activity Chart
Work Plan S. No. 1 2 3 4 5 6 7
Date 15/05/2014 22/05/2014 29/05/2014 12/06/2014 03/07/2014 16/07/2014 16/07/2014
Activities Start Work ( Discussion about the topics for study ) Initial Study (Selection of the topic of Initial Study) Secondary Data Collection Primary Data Collection Data Analysis/ Interpretation Project completion ( Discussion with the project guide & Reporting here) Summer Internship Programs End of Stage
Chapter No 6 KEY LEARNING
6.1 KEY LEARNING 1) The Process of all types of home loan taking. 2) Document Required for Loan Sanction. 3) Document Required for Loan Disbursement. 4) How to the determine the Processing fees applicable for various customer 5) Process of Customer Verification 6) How the Manager deals with the various customer 7) How to determine loan eligibility based on EMI chart 8) Minimum balance required for qualifying loan
Chapter No 7 CONTRIBUTION TO THE ORGANIZATION
7.1 Contribution to The Organization 1) Visits to the various Residential Construction sites & attract new customer to our company 2) In PCMC area I have visited on more than 10 Builder construction sites 3) In PCMC area I have visited to more than 50 customers by visiting their residence 4) In two months I had recommended 11 customer to LIC housing family from my own reference ( 11 customer taking a loan) & after two month of ( SIP ) in addition to 5 customer have availed the loan from my own reference. 5) Daily calling for new customer & asking a customer requirement for loan & follow up of customer.
Chapter No 8 QUESTIONNAIRE & WEB SITE DETAILS
8.1 QUESTIONNAIRE 1. What is your age? A. 25-35 B. 35-50
C. 50-60
D. above 60
2. What is your occupation? A. Service Class B. Businessman 3. What is your Annual Income? A. Below 2 lac B. 2 -5 Lac
C. Professional
C.5-10 lac
D. Above 10 Lac
4. Do you have your own property? A. Yes B. No 5. What is your Property Cost A. Above 10 to 25 lac
B. Above 25 to 50 lac
C. Above 50 to 75 lac
D. More than 75 lac
6. What is your reaming balance ( Source of Fund ) paid by Builder ? A. Saving in Bank
B. Provident Fund
C. Disposal of Investment / Property D. Loan from Employer 7. Are you interested in buying a property in near future? A. Yes B. No C. Can’t say 8. If Yes Which type of property you interested? A. Residential B. Commercial
C. Other
9. If interested, the main purpose of buying the property isA. For self purpose B. For investment C. Others ___________________ 10. Are you satisfied with the home loan procedure of Bank? Yes
No
11. Rate of interest at LIC Housing Finance is High Low Normal 12. Pl Specify the location in which you are interested for buying property? _______________________
Name: Address: Contact No:
CASE NO.1 1) Applicant Name
:
Mr. Nilesh Palhade
2)Loan Amount Applied
:
1967000/-
3)Tenor Requested
:
25 Yrs
4)Profile
:
Applicant
:
Salaried
Organisation
:
Deutsche Bank
5) Monthly salary:
Applicant: Rs.27242 p.m. & Incentive Rs.7550 p.m.
6) Strength of the Case:
Bank Salary Qualified Profile No Existing obligation Super Worksite Company 7) Findings:
1) Field Investigation report is Negative due to House found locked at the time of Visit. 2) Exiting Loan For Education Loan Track Record One Cheque To Bounce 8) Suggestions:
1) Field Investigation Report is Negative and FOIR is exceeding hence; Approval should be taken from Higher Authority i.e. Regional Business Head. 2) Reason for Cheque Bounce on his Education loan
CASE NO.2 Mr. Yogesh Patil
1) Applicant Name
:
2) Co-Applicant Name
:
Mrs. Geeta Patil
3) Loan Amount Applied
:
Rs. 1600000/-
4) Tenor Requested
:
20Yrs
5) Profile
:
Applicant
:
Business
Organization
:
Tax Consultancy, Life Insurance Agent
Co-Applicant :
House Wife
6) Monthly salary:
Applicant: Rs.423142 p.a. 7) Strength of the Case:
Bank Balance Good Good Business Report Good Saving in Recurring Deposits, Fix Deposits LIC Policy worth Rs 30 Lakhs Income tax Paid in Time & Customer is tax Consults 8) Findings:
Applicant Bank Statement showing monthly deduction of EMI of Axis Bank and the said was reflected in CIBIL Verification report.
9) Suggestions:
As per discussion with Applicant his Loan to be close aft er Sanction. There Loan Closing NOC Report attach in Disbursement file.
CASE NO.3
1) Applicant Name
:
Mr. Khushboo Singh
2) Co-Applicant Name
:
Mr. Prakash Singh
3) Loan Amount Applied
:
2725000
4) Tenor Requested
:
20 Years
Applicant
:
House wife
Co-Applicant
:
Salaried
Organization
:
SKH Magneti Marelli Exhaust Sys Pvt, Ltd.
5) Profile:
6) Monthly Income:
Co-Applicant :
Rs.68477 p.m.
7) Strength of the Case:
Good Salary Very Very Good Bank Balance Maintaining (above 25000 for Minimum) Good RTR of Existing H. Loan 8) Findings:
1) Co-Applicant Bank Statement showing monthly deduction of Rs.11458 & 3859 as EMI of Housing Loan & Personal Loan 2) Co-Applicant Purchase on second property. 9) Suggestions:
1) As per discussion with Co-Applicant he is not going to nil that Housing loan hence the said EMI should be considered as obligation in loan eligibility calculation & Demand on Track Record for Both Loan
CASE NO.4
1) Applicant Name
:
Mr. Sambhaji Karpe
2) Loan Amount Applied
:
Rs 450000/-
3) Tenor Requested
:
10 Year
Applicant
:
Salaried
Organization
:
Emcure Pharmaceuticals Pvt. Ltd
:
Rs.34512 p.m.
4) Profile
:
6) Monthly Income: Applicant
7) Strength of the Case:
Good Bank Balance Good Salary on his Demanding Loan PF Balance is 7 Lakhs 8) Findings:
1) Applicant Bank Statement showing monthly deduction of EMI of LIC Housing Loan for his Previous loan and the said was reflected in CIBIL Verification report. 2) Applicant salary slip is not self attested 3) Applicant take a Top-up Loan on his personal work 9) Suggestions:
1) Applicant is not need for close his Home Loan for Existing because his t hat loan additional loan taken
CASE NO.5
1) Applicant Name
:
Mr. Pratha Sarathi Mukherjee
2) Co-Applicant Name
:
Mrs. Sutapa Mukherjee
3) Loan Amount Applied
:
Rs.1,650,000/-
4) Tenor Requested
:
9 Years
Applicant
:
Salaried
Organization
:
Jankidevi Bajaj Gram Vikas Sanstha
Co-Applicant
:
House wife
:
Rs.36314 p.m.
5) Profile
:
6) Monthly Income: Applicant 7) Strength of the Case:
Salary Bank Statement is Very Good Maintain Good Investment in Fix Deposits & Mutual Fund Recurring Deposits Stable / Govt. Job No any Obligation PF Balance worth Rs.20 Lacs Owned House worth Rs.35 Lacs Qualified Profile 8) Findings:
Applicant’s Age is 51 years. 9) Suggestions:
Loan Amount possible for only 9 years remaining in the service hence maximum loan tenor should be restricted to 9 years.
