642013_11182_f014_home loan of hdfc bank

7/30/2019 642013_11182_f014_home Loan of Hdfc Bank

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A STUDY ON HOME LOAN

OF HDFC BANK LTD.BY: KUMARI SURABHI 12DM053

AMLAN MOHANTY 12DM029

SUSHMITA PAUL 12DM049

RISHA MISHRA 12DM047

DEEPIKA MOHANTY 12DM084


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HDFC BANK LTD.

The Housing Development Finance Corporation Limited (HDFC)was amongst the first to receive an 'in principle' approval from the

Reserve Bank of India (RBI) to set up a bank in the private sector,

as part of the RBI's liberalisation of the Indian Banking Industry in

1994.

The bank was incorporated in August 1994 in the name of 'HDFCBank Limited', with its registered office in Mumbai, India.

HDFC Bank commenced operations as a Scheduled Commercial

Bank in January 1995.

The objective is to build sound customer franchises across distinct

businesses so as to be the preferred provider of banking services fortarget retail and wholesale customer segments, and to achieve

healthy growth in profitability, consistent with the banks risk

appetite.


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CONT.

The bank has three key business segments: Wholesale Banking

The Bank's target market is primarily large, blue-chip manufacturing

companies in the Indian corporate sector and to a lesser extent,

small & mid-sized corporates and agri-based businesses.

Retail BankingThe objective of the Retail Bank is to provide its target market

customers a full range of financial products and banking services,

giving the customer a one-stop window for all his/her banking

requirements.

TreasuryWithin this business, the bank has three main product areas -

Foreign Exchange and Derivatives, Local Currency Money Market &

Debt Securities, and Equities .


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Financial Highlights - Quarter ended

December 2012

Net profit up by 30.0% to 18.6 Bn

Gross advances increased by 24.2% to ` 2,432 Bn

Deposits up by 22.2% to 2,841 Bn

CASA ratio at 45.4% Net Interest Margin at 4.1%

Core Cost-to-income ratio at 47.1%

Gross NPA / gross advances at 1.0%

Net NPA / net advances at 0.2%

Capital adequacy ratio (CAR) - total 17.0% of which tier

I at 10.9%


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HOME LOAN

Home Loan is a Secured Loan offered against the security of ahouse/property which is funded by the banks loan, the property

could be a personal property or a commercial one.

The HDFC Advantage

Pioneers of Housing Finance in India with over 33 years of lending

experience

Widest range of Home Loan Products

Most experienced and empowered personnel to ensure smooth &

easy processing.

Counselling and advisory services for acquiring a property Loan from any office for purchase of home anywhere in India

Loan approval even before a property is selected

Flexible loan repayment options

Free & safe document storage


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HOME LOAN PRODUCTS

Home loan

Home improvement loan

Home extension loan

Rural housing finance


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1)Home Loan:

Home loans for individuals to purchase (fresh / resale)or construct houses. Application can be made

individually or jointly.

HDFC finances up to 80% of the cost of the property

(including the cost of the land) based on the repayment

capacity of the customer.


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2)Home Improvement Loan:

HIL facilitates internal and external repairs and other

structural improvements like Painting, Waterproofingand Roofing, Plumbing and Electrical Works, Tiling and

Flooring, Grills, Aluminum Windows compound walls

and much more.

HDFC finances up to 85% of the cost of improvement.

This is however subject to 80% of market value as

assessed by HDFC.


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3)Home Extension Loan:

HEL for adding more space to your existing home

for meeting the requirements of your growing family

be it an extra bedroom for your children, a readingroom for yourself or a cozy coffee corner.

HDFC finances up to 85% of the cost of extension.

This is however subject to 80% of market value as

assessed by HDFC.


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ELLIGIBILITY FOR HOME LOANSalaried Self employed

AGE 21years to 58years 21years to 65years

Income Rs.1,20,000 (p.a) Rs.1,50,000 (p.a)

Loan Amount Offered 2,00,000 - 1,00,00000 2,00,000 - 2,00,00000

Tenure 5years-20years 5years-20years

Current Experience 3years 2years

Processing Fee 11000/- or 0.5% 11000/- or 0.5%


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DOCUMENTS REQUIRED

Salaried Customers Self Employed Professionals Self Employed BusinessmanApplication form with photographApplication form with photographApplication form with photograph

Identity and Residence Proof Identity and Residence Proof Identity and Residence ProofLatest Salary-slip Education QualificationsCertificate and Proof of business

existenceEducation Qualifications

Certificate and Proof of business

existenceForm 16 Last 3 years Income Tax returns

(self and business) Business profile

Last 6 months bank statements Last 3 years Profit /Loss andBalance Sheet

Last 3 years Income Tax returns(self and business)

Last 3 years Profit /Loss and

Balance Sheet

Processing fee cheque Last 6 months bank statementsProcessing fee cheque

Last 6 months bank statements

(self and business)

Processing fee cheque


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LOAN SANCTIONING PROCESS

A home loan is a long term commitment of 15-20.It is desirable thata proposed borrower should first understand the stages of obtaining

a Home Loan. Listed below are the steps for HDFC home loan

process:

Step 1: Application Form

The process starts with formal application of the Home Loan. HDFCwould provide a form that demands some basic information about

the proposed borrower.

Step 2: Personal Discussion

HDFC Bank Home Loan approving department would go for a

personal discussion with the customer to judge the aspirant.

Step 3: Bank's Field Investigation

The bank normally outsource agency to do a verification of the

applicants residence and place of work.


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Step 4: Credit appraisal by the bank and loan sanction

HDFC would then compute your eligibility based on your income

documents and verification reports and sanction the loan.

Step 5: Offer Letter

As a confirmation of the loan approval the borrower would receive asanction letter from the bank stating the loan amount, tenor, rate of

interest and all other terms under which the loan gets approved.

Step 6: Submission of legal documents & legal check

After loan authorization the bank would ask for the property related

documents to validate that the proposed property is free from anylitigations.


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Step 7: Technical / Valuation check

HDFC would send engineer to do an exact valuation of the

proposed property.

Step 8: Signing of agreements and submitting post-dated

chequesThe borrower at this stage needs to sign the home loan agreement

as an acceptance to the terms and conditions of the sanction.

Step 9: Disbursement

HDFC would finally disburse the loan amount based on the work

progress or as per builder demand.HDFCs dedicated team of experts would maintain transparency

throughout the process and offer a complete package to meet

housing finance requirements of the borrower.


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INTERESTRATES

1. Adjustable Rate of Home Loan Loan under Adjustable Rate is linked to HDFC LTD

Retail Prime Lending Rate (RPLR).

The rate on your loan will be revised every three months

from the date of first disbursement, if there is a change inRPLR, the interest rate on your loan may change.

However, the EMI on the home loan disbursed will not

change.

If the interest rate increases, the interest component inan EMI will increase and the principal component will

reduce resulting in an extension of term of the loan, and

vice versa when the interest rate decreases.


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CONT.

Loan SlabsApplicable

Variable rates

%Basis : RPLR

minus SpreadUpto and

including Rs 30

lacs10.15% RPLR - 6.25

Over Rs. 30

lacs10.40% RPLR - 6.00


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2. Tru Fixed Home Loan

Under this rate the customer has the option to choose a

Fixed Interest Rate Period (FIRP) between 3 to 10 years Post the fixed rate period the loan will automatically

convert to a variable rate product.

The customer also has the option, subject to HDFC LTD

eligibility norms to take a complete fixed rate termproduct for a fixed term of 3 to 10 years.


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CONT.

Or, he can avail a long term loan of 15 to 20 years with a

part fixed and part floating for the entire tenor of the loan.

The full disbursement of the loan, irrespective of the

fixed period chosen, shall have been availed within the

first 3 years from the date of first disbursement of the

loan.

Post the fixed rate period the interest rates applicable

on the loan shall be the then applicable HDFC LTD

RPLR minus the spread as applicable currently on theloan amount being availed under this product.


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Loan SlabsInterest Rates during the

Fixed

Interest Rate Period ( % )Up to and including Rs 10

lacs10.75

Rs.10.01 lacs to Rs.75

lacs11

Over Rs.75 lacs 11.25


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OTHER CHARGES

Charges for late payment of EMI : 2% per month

Cheque swapping charges : Rs.500/-

Bounce Cheque Charges : Rs.500/-

Duplicate Statement Charges (per statement) : Rs.100/- per page,

Maximum Rs.300/- Issue of Duplicate Provisional Interest Certificate : Rs.300/-

Issue of Duplicate Interest Certificate : Rs.300/-

Duplicate Balance Certificate : Rs.300/-

Issue of Amortization Schedule (Duplicate) : Rs. 300/-

Switch from Variable to Fixed : Not Applicable

Switch from Fixed to Variable : Not Applicable

Photocopy of Documents : Rs.500/-


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BENEFITS TO CUSTOMERS

Automated Repayment of Home loan EMI

You can give us standing instructions to repay your

Home Loan EMIs directly from your HDFC Bank Savings

Account, thus, saving you the trouble of procuring,

signing and tracking post-dated cheques.

HDFC also offers In-house scrutiny of Property

documents for your complete peace of mind.

Customer privileges

If you are an existing HDFC Home Loan customer, youcan avail of other loans (such as Personal Loans,Car

Loans, Two-wheeler Loans and Loan against securities)

at lower interest rates.


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Loan cover Term Assurance Plan

HDFC Standard Life Insurance Company Ltd. offers an

insurance plan. LCTAP provides a lump-sum payment on the

unfortunate demise of the life assured.

This pure risk plan is designed in a way that the cover

decreases as you repay your home loan making it a lowcost premium insurance plan.


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RURAL HOUSING FINANCE

HDFC offers home loans in rural areas for:

- Agriculturists

- Dairy Farmers

- Planters- Horticulturists

Construction of houses on plot owned by you

Addition of more rooms or floors to your existing house

Renovation & improvement of your house

Purchase of a new house


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FEATURES

For Agriculturists: If you are a farmer/planter/horticulturist/dairy farmer

etc. having your own land and looking to build your

own home, get in touch with us.

Specially Designed Housing Loans for Agriculturists. Loan eligibility on the basis of land owned by you and

the crops being cultivated.

Housing Loan in residential area of your own village

Loans for buying house or flat in city of your choice


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For Salaried & Self Employed:

Everyone wants a place to call home what better

place than your village or town to own one.

Housing Loans for homes in rural areas for Salaried

persons

Housing Loans for homes in rural areas for Self

Employed Businessmen or Self Employed

Professional.


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DOCUMENTS

Agriculturists SalariedCustomers

Self

EmployedProfessionals

SelfEmployed

Businessmen

Application

form withphotograph

Application

form withphotograph

Application

form withphotograph

Application

form withphotograph

Identity

and

Residence Proof

Identity and

ResidenceProof

Identity and

ResidenceProof

Identity and

ResidenceProof

Last 6months

bank

statements

Last 6 monthsbankstatements

Last 6 monthsbankstatements

Last 6months bank

statements

(self &business)

Processi

ng fee

chequeProcessingfee cheque Processing feecheque Processingfee cheque


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INCOME DOCUMENTSCopies of

TitleDocuments

of

Agricultural

Land

depicting

Land

holding

Latest

Salary SlipEducation

Qualifications

Certificate

and Proof ofbusiness

Education

Qualifications

Certificate

and Proof ofbusiness

Copies of

Title

Documents

of

Agricultural

Land

depictingcrops beingcultivated

Form 16 Last 3 yearsIncome Tax

returns (selfand business

Business

profile &

Last 3 years

Income Taxreturns

Statement of

last 2 years

of loansavailed

Last 3 years

Profit /Loss

and BalanceSheet

Last 3 years

Profit /Loss

and BalanceSheet


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CUSTOMER SATISFACTION

SURVEY

When have you taken Home Loan from HDFCLtd.?

Before 1 year

Before 2 to 3 year

More than 3 years

SAMPLE

SIZE- 16

Out of the people we have Surveyed i.e 16(Sample Size) ,44%

Customers had taken their loan before 1 year followed by 31%

people who have taken it for more than 3 yrs


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Reason for taking Home Loan from HDFC Ltd.?

Reason for taking Home Loanfrom HDFC Ltd.?Faster Processing

Interest Rates

Brand image of the Bank

Margin Amount

Others

In Our Survey We Found that 7 people i.e 44% people

have taken home loan from HDFC because of its

brand name followed by its processing fees that is 31%

And interest rate that is 25%


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How do you rate the Interest rates charged by HDFC Ltd.?

Highly Satisfactory

Satisfactory

Average

Dissatisfactory

Highly Dissatisfactory

This above figure shows us that how people have

rated the interest rate charged by HDFC .

we found that 47% people were satisfied ,24% of

people were highly satisfied and 29% feel that its

actually more when compared to other Housing Loan

Companies.


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How do you rate the EMI of HDFC Ltd.?

Highly Satisfactory

Satisfactory

Average

Dissatisfactory


On this particular question of the EMI plan of we got response like

25% people felt that the EMI that they are paying is better, and they

are highly satisfied with it, same 25% people felt it was only

satisfactory for them, And out of the rest 50%, 25% people rated it

average while the rest 25% people felt that the are paying a bit morefor the EMIs.


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How do you rate the Sanctioning Time of HDFC Ltd.?

Highly Satisfactory

Satisfactory

Average

Dissatisfactory


People were actually very much satisfied with the sanctioning

time of their loans out of 16 peoples we interviewed 8 peoples

i.e. 50% of people felt that they are highly satisfied and other 50

% very also satisfied although not highly satisfied but they were

satisfied.


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How do you rate the Sanctioning Procedure of HDFC Ltd.?

Highly Satisfactory

Satisfactory

Average

Dissatisfactory


This is the area HDFC should focus upon as we found some of the

people were dissatisfied with their sanctioning procedure. Although

50% of people were satisfied but there were some people like 44%

who said the procedure was average and 6% people felt it was

dissatisfactory


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How do you rate the home loan services provided by yourbank as compared to other bank?

Highly Satisfactory

Satisfactory

AverageDissatisfactory


When the customers were asked about the overall service of the

home loan when compared with other banks people had mixed

results about it like 31% people were Highly satisfied same

percentage of people also rated it Average and Satisfactory but 6%

people found it Dissatisfactory.


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Are you satisfied with HDFC Ltd. Home Loans?

YesNo

The people who have taken HDFC housing loan were actually

satisfied with the home loan. Out of 16 people we surveyed 15 of

them i.e. 94% were satisfied and 1 person out of the 16 felt they dint

match up to his expectation which formed 6% of the total sample

size.


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FINDINGS

We found that people were satisfied with the interest

rates charged by HDFC bank ltd.

People have taken home loan from HDFC because of its

brand name followed by its processing fees and interest

rate.

People felt that the EMI that they are paying is better,

and they are highly satisfied with it.

People were highly satisfied with the sanctioning time of

loan of HDFC bank.


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CONCLUSION

Overall ,customers are highly satisfied with

HDFC bank ltd. and their housing loan

services.

HDFC bank is the one of the best option fortaking home loan.


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