PREFACE

I am extremely happy to place before the esteemed teacher HOUSING

FIANANCE COMPANY MARKETING STRATEGY OF HDFC . It is an attempt

make by me to find out the leading brands in Sagar City.

The Project Report has on objective to get the B.B.A. Studetns

familiar with real life buisness situations and gives an opportunity to the

student’s to understand the theoretical concepts of marketing and finance in

practical way.

The research starts with a short introduction of the company

followed by the line of the objective and research methodology.

Next Chapter Deals with the data analysis and interpretation that is

based on questionnaire. Then comes the limitation, suggestions conclusion of

the research report.

Student’s name : NEERAJ KACHHI Class :BBA VTH SEM.

GIMS 1

ACKNOWLEDGEMENT

I Wish to express my deep sense of gratitude to all who generously helped in

successful completion of the project work by sharing their valuable time and

knowledge.

I thankfully acknowlege Mr. Manish Jain (HOD BBA Dept) GIMS Sagar for

giving me the opportunity to conduct and survey.

I Would like to express my sincere thanks to “MISS RUPALI PATEL”

LecturerBBA Dept) and all other faculty members, GIMS sagar who directly and

indirectly rendered me all possible help and guidance for preparing the report.

Finally I would like to thanks my parents, my friends without whom completion

of my project report would not have been possible.

Student’s name : NEERAJ KACHHI

Class :BBA VTH SEM.

GIMS 2

CERTIFICATE

A PROJECT REPORT ON HOUSING FIANANCE COMPANY

MARKETING STRATEGY OF HDFC is prepared by NEERAJ KACHHI under

The guidance of Miss RUPALI PATEL is a satisfactory in respect to comments

Contents and presentation of the Subject Matter.

Language

Submission with in due date.

Signature of Supervisor Signature of Examiner Signature of

HOD

GIMS 3

DECLARATION BY THE CANDIDATE

Date:

I declare that the project report titled “HOUSING FIANANCE COMPANY

MARKETING STRATEGY OF HDFC” is my own work conducted under the

supervision of MISS RUPALI PATEL, Gyanveer Institute of Management and

Science Sagar. To the best of my knowledge the report does not contain any

work, which has been submitted for the award of any degree, anywhere.

Student’s name : NEERAJ KACHHI

Class :BBA VTH SEM.

-

GIMS 4

TABLE OF CONTENTS Preface Acknowledgement Certificate Declaration by the Candidate

TOPIC NAME PAGE NO.

CHAPTER – 1 INTRODUCTION

(A) COMPANY PROFILE

(B) HISTORY

(C) KEY PERSON

CHAPTER – 2 OBJECTIVE

CHAPTER – 3 RESEARCH METHODOLOGY

(A) TYPE OF RESEARCH

(B) SOURCE OF RESEARCH

CHAPTER – 4 PRODUCT DETAILS

CHAPTER – 5 FINANCIAL POSITION

CHAPTER – 6 DATA ANALYSIS AND INTERPRETATION

CHAPTER – 7 SWOT ANALYSIS

CHAPTER – 8 LIMITATION

CHAPTER – 9 SUGGESTION AND CONCLUSION

CHAPTER – 10 BIBLIOGRAPHY

CHAPTER – 11 QUESTIONNAIRE

GIMS 5

GIMS 6

INTRODUCTION

Housing is one of the best human needs of the society. It is closely

linked with the process of overall socio-economic development of a country. India,

being a highly populated country, there is a great need and scope for the development

of Housing Sector. Unfortunately, for some reasons or the other, the housing sector in

India has remained underdeveloped in the past, however, it is hoped that there would

be improvement in the near future.

Housing is a growing industry. There is substantial gap between demand and supply

and is persisting for a very long period. According to an estimate by the National

Building Organization, the cumulative shortage of total dwelling houses in the country

by the end of 1991 was 31 million. It is further estimated by this organization that the

demand for housing will be around 4.5million units, leaving a gap of one million

housing units annually. Hence, based upon this estimate, the cumulative shortage of

housing may reach to 41million units by the end of this century.

Presently, funds required per dwelling shelter are so high that the individual’s saving

is not adequate to meet the expenditure of house building. As a result, there is great

demand for external housing finance.

Housing was given due priority only in 1988 when a National Housing Policy was

announce. The policy reflected the trust that housing was not merely consumption

expenditure but also a productive investment which would provide economic activity

in the country. Besides this, the policy also envisaged that an impetus given to housing

would stimulate economic development through creation of substantial employment

opportunities. Consequently, the institutional mechanism for housing was

strengthened by the establishment of National Housing Bank (NHB) by the Reserve

Bank of India.

GIMS 7

COMPANY PROFILE

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

'HDFC Bank Limited', with its registered office in Mumbai, India. HDFC Bank

commenced operations as a Scheduled Commercial Bank in January 1995.

BUSINESS FOCUS

HDFC is India's premier housing finance company and enjoys an impeccable

track record in India as well as in international markets. Since its inception in 1977,

the Corporation has maintained a consistent and healthy growth in its operations to

remain the market leader in mortgages. Its outstanding loan portfolio covers well

over a million dwelling units. HDFC has developed significant expertise in retail

mortgage loans to different market segments and also has a large corporate client

base for its housing related credit facilities. With its experience in the financial

markets, a strong market reputation, large shareholder base and unique consumer

franchise, HDFC was ideally positioned to promote a bank in the Indian

environment.

CAPITAL STRUCTURE

The authorised capital of HDFC Bank is Rs.450 crore (Rs.4.5 billion). The

paid-up capital is Rs.311.9 crore (Rs.3.1 billion). The HDFC Group holds 22.1% of

the bank's equity and about 19.4% of the equity is held by the ADS Depository (in

respect of the bank's American Depository Shares (ADS) Issue). Roughly 31.3% of

the equity is held by Foreign Institutional Investors (FIIs) and the bank has about

190,000 shareholders. The shares are listed on the The Stock Exchange, Mumbai and

the National Stock Exchange. The bank's American Depository Shares are listed on

the New York Stock Exchange (NYSE) under the symbol "HDB".

GIMS 8

DISTRIBUTION NETWORK

HDFC BANK

HDFC Bank is headquartered in Mumbai. The Bank at present has an enviable

network of over 761 branches spread over 327 cities across India. All branches are

linked on an online real-time basis. Customers in over 120 locations are also serviced

through Telephone Banking. The Bank's expansion plans take into account the need to

have a presence in all major industrial and commercial centres where its corporate

customers are located as well as the need to build a strong retail customer base for

both deposits and loan products. Being a clearing/settlement bank to various leading

stock exchanges, the Bank has branches in the centres where the NSE/BSE have a

strong and active member base.

March 2006 March 2007 March 2008

Citied 228 316 327

Branches 535 684 1229

ATMs 1323 1605 2400

The Bank also has a network of about over 1977 networked ATMs across these cities.

Moreover, HDFC Bank's ATM network can be accessed by all domestic and

international Visa/MasterCard, Visa Electron/Maestro, Plus/Cirrus and American

Express Credit/Charge cardholders.

TIMESBANK AMALGAMATION

In a milestone transaction in the Indian banking industry, Times Bank Limited (another new

private sector bank promoted by Bennett, Coleman & Co./Times Group) was merged with

HDFC Bank Ltd., effective February 26, 2000. As per the scheme of amalgamation

approved by the shareholders of both banks and the Reserve Bank of India, shareholders of

Times Bank received 1 share of HDFC Bank for every 5.75 shares of Times Bank. The

acquisition added significant value to HDFC Bank in terms of increased branch network,

expanded geographic reach, enhanced customer base, skilled manpower and the opportunity

to cross-sell and leverage alternative delivery channels.

GIMS 9

MANAGEMENT

Mr. Jagdish Capoor took over as the bank's Chairman in July 2001. Prior to this, Mr. Capoor

was a Deputy Governor of the Reserve Bank of India.

The Managing Director, Mr. Aditya Puri, has been a professional banker for over 25 years,

and before joining HDFC Bank in 1994 was heading Citibank's operations in Malaysia.

The Bank's Board of Directors is composed of eminent individuals with a wealth of

experience in public policy, administration, industry and commercial banking. Senior

executives representing HDFC are also on the Board.

Senior banking professionals with substantial experience in India and abroad head various

businesses and functions and report to the Managing Director. Given the professional

expertise of the management team and the overall focus on recruiting and retaining the best

talent in the industry, the bank believes that its people are a significant competitive strength.

HISTORYGIMS 10

HDFC BANK LTD was incorporated in August 1994 in the name of 'HDFC Bank Limited’,

with its registered office in Mumbai, India. HDFC Bank commenced operations as a

Scheduled Commercial Bank in January 1995.

HDFC BANK LTD was amongst the first to set up a bank in the private sector. The bank

was incorporated on 30th August 1994 in the name of ‘HDFC Bank Limited’, with its

registered office in Mumbai. It commenced operations as a Scheduled Commercial Bank on

16th January 1995. The bank has grown consistently and is now amongst the leading players

in the industry .

HDFC is India's premier housing finance company and enjoys an impeccable track record in

India as well as in international markets. Since its inception in 1977, the Corporation has

maintained a consistent and healthy growth in its operations to remain the market leader in

mortgages. Its outstanding loan portfolio covers well over a million dwelling units.

HDFC has developed significant expertise in retail mortgage loans to different market

segments and also has a large corporate client base for its housing related credit facilities.

With its experience in the financial markets, a strong market reputation, large shareholder

base and unique consumer franchise, HDFC was ideally positioned to promote a bank in the

Indian environment In a milestone transaction in the Indian banking industry, Times Bank

was merged with HDFC Bank Ltd., effective February 26, 2000.

MISSION

GIMS 11

I. World Class Indian Bank

II. Benchmarking against international standards.

III. To build sound customer franchises across distinct businesses

IV. Best practices in terms of product offerings, technology, service levels, risk

management and audit & compliance

VISION STATEMENT OF HDFC BANK

The HDFC Bank is committed to maintain the highest level of ethical standards,

professional integrity and regulatory compliance. HDFC Bank’s business philosophy

is based on four core values such as:-

1. Operational excellence.

2. Customer Focus.

3. Product leadership.

4. People.

The objective of the HDFC Bank is to provide its target market customers a full range

of financial products and banking services, giving the customer a one-step window for

all his/her requirements. The HDFC Bank plus and the investment advisory services

programs have been designed keeping in mind needs of customers who seeks distinct

financial solutions, information and advice on various investment avenues.

KEY PERSON

GIMS 12

MR.HASMUKHBHAI PAREKH

If ever there was a man with a mission it was Hasmukhbhai

Parekh, our Founder and Chairman-Emeritus, who left

this earthly abode on November 18, 994.

MR. DEEPAK PAREKH

Deepak Parekh is the Chairman of HDFC, the country’s

leading housing finance company. A pioneer in mortgage

finance, he has enabled scores of Indian middle class

people owning their houses or apartments through

affordable loans.

OBJECTIVE OF THE STUDY

GIMS 13

o To study how to choose the right housing finance bank.

o To study how do get loan for construction of residential houses.

o To discuss housing credit more affortable.

o To know the some of housing finance schemes.

o To discuss some tip for buying house.

o To study of terms and condition of home loan.

RESEARCH METHODOLOGY

Research Design:GIMS 14

The research design indicates the type of research methodology under taken to

collect the information for the study.

The researcher used both descriptive and analytical type of research design for his

research study. The main objective of using descriptive research is to describe the state

of affairs as it exits at present. It mainly involves surveys and fact finding enquiries of

different kinds. The researcher used descriptive research to discover the characteristics

of customers. Descriptive research also includes demography characteristic of

consumer who use the product.

The researcher also used analytical research design to analyze the existing facts

from the data collected from the customer.

Area of study:

The area of study is confined to Co-operative Bank , Sagar City. .

Sampling design:

A Sample design is a definite plan for obtaining a sample from a given population. It

is the procedure used by the researcher in selecting items for the sample.

Sample size:

Sample size=45 samples, variance and confidence methods are used for

determining sample size.

Sampling Technique:

The researcher adopted simple random sampling for the study.

SOURCES OF DATA GIMS 15

DATA COLLECTION METHOD

Primary data:

Primary data is the new or fresh data collected from the respondents through

structured scheduled questionnaire.

Secondary data:

The secondary data are collected through the structured questionnaire, and also from

the past records maintained by the company.

PRODUCTS DETAILS

GIMS 16

HOME LOAN TYPES

Owning a piece of land or property is a lifetime dream for every individual. There are many home loans provider in the market to make your dream come true. But before you opt for any home loan provider, you need to consider certain factors related to property that you are interested in buying and also about the salient features offered by a home loan provider and also study some Home Loans and Home Insurance FAQs which helps in applying a Home Loan in India.

And the most important thing is you should know about each and every termrelated with Home Loans before applying for a Loan. It is always advisable to consult a home loan expert or consultant before applying for a home loan or purchasing a property.

You can take different types of home loans like Bridge Loans, Home construction Loans, Home Equity Loans, Home Extension Loans, Home Improvement Loans, Land Purchase Loans etc for different schemes available in the market. There are different types of home loans tailored to meet your needs.

Home Purchase Loans: These are the basic forms of home loans used for purchasing of a new home.

Home Improvement Loans: These loans are given for implementing repair works, healing and renovations in a home that has already been purchased.

Home Construction Loans: These loans are available for the construction of a new home.

Home Extension Loans: These loans are given for expanding or extending an existing home. For egg: addition of an extra room etc.

Home Conversion Loans: These loans are 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: These loans are available for purchasing land for both construction and investment purposes.

GIMS 17

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.

HOUSING FINANCE IN INDIA

The Home loan sector in India is the pi-vital role player in the growth of the real estate scenario in India. With tax incentives given to the housing finance sector in the annual budget of 2001, transactions related to buying and selling of residential properties increased considerably and was much higher as compared to previous years. Since the new class of buyers are relatively younger set of customers who are more aware about legal documentation and approvals, buyers are now more 'end-users' rather than investors; the property market in India undergoes transformation to align itself with global standards with an increased emphasis on quality & cost control and documentation methods. In the current economy of India, the real estate sector has the maximum propensity to generate income and demand for materials, equipment and services. It can be said that housing finance companies were formed for co-existing with buyer's requirements of housing loans for investing in properties. Home loans are made available by financial institutions to both Indian and NRI customers at floating and fixed rate of interest and also at attractive EMI options.

For construction or buying a new home For home repairs and renovations For purchase of plots Against mortgage of property

No tax benefits are available for NRI customers unless you file returns and thereby become eligible to avail of the tax benefits.

Besides home loans, Commercial property loans are also available and different financial institutions in India provide commercial loans at different rates and different upper limits.

Real estate loans are available to builders, promoters and real estate developers. The experience and financial standing of the builders is taken into account before the loan is granted which is to be returned with the minimum installments.

Today, the amount of money that a city dweller spends on rent is roughly the same, or only slightly less than the amount he pays as an EMI on a housing loan. Earlier the home loan sector in India was solely dependent on nationalized and public sector banks, but the entry of public sector banks into the housing finance business marked the beginning of the first round of interest rate cuts. And this reduction in interest rates has enhanced the borrowing power of customers. Moreover, HFCs are offering incentives to attract investors like

Some companies sanction the housing loan without requiring you to identify property as a pre-requisite for eligibility

Free accident insurance & property insurance Waiving of pre-payment penalty Waiving of processing fee

There are a few documents which the finance companies require for setting up

GIMS 18

CRITERIA FOR ELIGIBILITY OF HOME LOANS.

The realty boom in India has given a new dimension to the finance sector in India - both in Home Loans and Home Insurance segments. This has not only given a competitive edge to the finance companies to provide attractive options to customers but has also contributed to the increased investments in the real estate sector. This has resulted in 13 new institutions foraying into the housing finance business in the last three years.

GIMS 19

Salaried Employee Self-employed

The latest salary slip showing statutory deductions

Computation of income for the previous two years, certified by a Chartered Accountant

Form 16 (showing tax deducted at source by employer)

Profit & Loss Account and Balance Sheet for the previous two years, certified by a Chartered Accountant

Proof of age (birth certificate/voter identity card/passport/school-leaving certificate/valid driving license

Proof of age (birth certificate/voter identity card/passport/school-leaving certificate/valid driving license)

Proof of residence (phone bill/electricity bill/ration card).

Proof of residence (phone bill/electricity bill/ration card).

Major Home Loan Providers

Banks & Public Sector Housing Finance Companies

State Bank of India, Corporation Bank, Punjab National Bank, Central Bank, Dena Bank, Allahabad Bank, Bank of Maharashtra, Bank of Baroda Housing Finance, Can Fin Homes, GIC Housing Finance, LIC Housing Finance, PNB Housing Finance, SBI Home Finance, Centbank Home Finance, HUDCO, LIC, etc.

Financial Institutions

HDFC, ICICI Ltd, Citibank, HSBC, StandardChartered- Grindlays, IDBI Bank, etc

TAX BENEFITS ON HOME LOANS

As the Indian real estate market makes an upward swing, and investors opt for housing finance or home loans, tax benefits obtained from them is a lucrative option. Customers availing of Home Loans can claim a certain portion of the interest and principal that they pay towards the loan installments for reducing tax liability. Resident Indians are eligible for certain tax benefits on principal and interest components of a loan under the Income Tax Act, 1961. Moreover, an added tax benefits under Sec 80 C on repayment of principal amount up to Rs. 1,00,000 p.a. can be availed that can further reduce your tax liability by about Rs. 30,000 p.a.

Tax benefits can be claimed on both the principal and interest components of the home loan as per the Income Tax Act, 1961. These deductions are available to assesses, who have taken a loan to either buy or build a house, under Section 24(b). Interest on borrowed capital is deductible up to Rs 150,000 if the following conditions are satisfied:

Capital is borrowed on or after April 1, 1999 for acquiring or constructing a property.

The acquisition/construction should be completed within 3 years from the end of the financial year in which capital was borrowed.

The person, extending the loan, certifies that such interest is payable in respect of the amount advanced for acquisition or construction of the house

A loan for refinance of the principle amount outstanding under an earlier loan taken for such acquisition or construction.

If the conditions stated above are not fulfilled, then the interest on borrowed capital is deductible up to Rs 30,000 though the following conditions have to be satisfied:

Capital is borrowed before April 1, 1999 for purchase, construction, reconstruction repairs or renewal of a house property.

Capital should be borrowed on or after April 1, 1999 for reconstruction, repairs or renewals of a house property.

GIMS 20

If the capital is borrowed on or after April 1, 1999, but construction is not completed within 3 years from the end of the year, in which capital is borrowed.

In addition to the above, principal repayment of the loan/capital borrowed is eligible for a deduction of up to Rs 100,000 under Section 80C from assessment year 2006-07.

Terms and conditions for availing Tax benefits on Home Loans

1. Tax deductions can be claimed on housing loan interest payments, subject to an upper limit of Rs 150,000 for a financial year. Interest on the fresh loan can be claimed as a deduction, subject o the stated upper limit.

2. An additional loan for extension/addition to the same house and the person's deductions on the existing loan are less than Rs 150,000; he can claim further benefits from the additional loan taken, subject to the upper limit of Rs 150,000 for a financial year.

3. Tax benefits under Section 24 and deduction under section 80C of the Income Tax Act can be claimed only when the payment is made. If a person fails to make EMI payments, he cannot claim tax benefits for the same.

4. According to the Income Tax Act, only the person who has taken the loan can claim tax rebates.

5. The interest on home loans taken for repairs, renewals or reconstruction, also qualifies for the deduction of Rs 150,000.

6. A husband and wife, both of whom are tax-payers with independent income sources, get tax deduction benefits, with respect to the same housing loan; to the extent of the amount of loan taken in their own respective name.

7. If a person buys a house and sells it within the same year/after 3 years, and if any profit is made, then a capital gains tax liability arises on the same for which the individual is liable to pay short-term capital gains tax since the sale took place in the same year. But, if the sale had taken place after 3 years, then a long-term capital gains tax liability would have arisen.

8. If it is proved that the home loan is simply an arrangement between the loan-seeker and the builder or with a third party for the purpose of claiming tax benefits, then tax benefits will not be allowed and benefits, previously claimed, will be clubbed to the income and taxed accordingly.

9. Tax benefits on interest on housing loans are allowable only for the original loan and for a second loan taken to repay the first loan and not for subsequent loans. This means that if you have already availed of one loan to refinance the original loan and want to no avail a third loan to refinance the second loan, tax rebate on interest payments will not be permissible. This is because the Section 24 (1) only talks of the second loan and not of subsequent loans. Even if you take the second loan at a rate of interest higher than the original loan, you will be eligible for a tax rebate on the second loan.

GIMS 21

HDFC BANK

HDFC Bank was incorporated in 1994 by Housing Development Finance Corporation Limited (HDFC), India's largest housing finance company. It was among the first companies to receive an 'in principle' approval from the Reserve Bank of India (RBI) to set up a bank in the private sector. The Bank started operations as a scheduled commercial bank in January 1995 under the RBI's liberalization policies.

Times Bank Limited (owned by Bennett, Coleman & Co. / Times Group) was merged with HDFC Bank Ltd., in 2000. This was the first merger of two private banks in India. Shareholders of Times Bank received 1 share of HDFC Bank for every 5.75 shares of Times Bank.

In 2008 HDFC Bank acquired Centurion Bank of Punjab taking its total branches to more than 1,000. The amalgamated bank emerged with a base of about Rs. 1,22,000 crore and net advances of about Rs.89,000 crore. The balance sheet size of the combined entity is more than Rs. 1,63,000 crore.

HOME LOAN OF HDFC BANK

Features

Maximum loan-80% of the cost of the property (including the cost of the land) and based on the repayment capacity of the customer.

Applicant and Co- Applicant to the loan-Home Loans can be applied for either individually or jointly. Proposed owners of the property, will have to be co-applicants. However, the co-applicants need not be coowners.

Maximum Term-20 years subject to your retirement age. Adjustable Rate Home Loan-Loan under Adjustable Rate is linked to

HDFC's 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 in RPLR, 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 in an 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.* Conditions Apply

GIMS 22

Fixed Rate

Home Loan : Loan Purposes

One can apply for Power Home for the following purposes:

Purchase of

Flat, row house, bungalow from developers

Existing freehold properties

Properties in an existing or proposed co-operative housing society or

apartment owner's association

First Power of Attorney purchases in Delhi for DDA flats allotted before 1992. Home Loan: Eligibility

  Salaried Self

Age 21-60 years 25-65 years

IncomeIncome criteria not provided

Income criteria not provided

Job Experience

Job experience not provided

Job experience not provided

Residence Proof

Residence proof not provided

Residence proof not provided

Home Loan: Loan AmountLimits on home loan

Minimum - Rs 1 lac

Maximum - Rs 50 lacs

Margin

20% in the case of home loans

25% in case of improvement or renovation loans

Home Loan: Documentation

You can download the Application Form and submit alongwith the following documents for an approval of loan.

GIMS 23

Home Loan: Interest Rates & Charge

Applicable Rates(Monthly Rest Basis)

Fixed rates%

Variable rates%Basis%RPLR

Upto and including Rs 30 lacs

11.50 9.75 RPLR - 5.75

Rs.30.01 lacs to Rs.75 lacs 11.50 10.00 RPLR - 5.50

Over Rs.75 lacs 11.50 10.25 RPLR - 5.25

The above rates are subject to change without notice.

Home Loan: Terms and Conditions

Repayment

Step Up Repayment Facility- Helps young executives take a much bigger loan today based on an increase in their future income, this helps executives buy a bigger home today!

Flexible Loan installments Plan- Often customers, parents and their children, wish to purchase properties together. The parent is nearing retirement and their children have just started working. This option helps such customers combine the incomes and take a long term home loan where in the installment reduces upon retirement of the earning parent.

Tranche Based EMI- Customers purchasing an under construction property need to pay interest ( on the loan amount drawn based on level of construction) till the property is ready. To help customer save this interest, we have introduced a special facility of Tranche Based EMI. Customers can fix

GIMS 24

Salaried Customers

Self Employed Professionals

Self Employed Businessman

Application form with photograph

Application form with photograph

Application form with photograph

Identity and Residence Proof

Identity and Residence Proof

Identity and Residence Proof

Latest Salary-slip

Education Qualifications Certificate and Proof of business existence

Education Qualifications Certificate and Proof of business existence

Form 16Last 3 years Income Tax returns (self and business)

Business profile

Last 6 months bank statements

Last 3 years Profit /Loss and Balance 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 statements

Last 6 months bank statements (self and business)

Processing fee cheque Processing fee cheque

the installments they wish to pay till the time the property is ready for possession. The minimum amount payable is the interest on the loan amount drawn. Anything over and above the interest paid by the customer goes towards Principal repayment. The customer benefits by starting EMI and hence repays the loan faster.

Security

Disbursement

The loan will be disbursed in full or in suitable installments, taking into account the

requirement of funds and progress of construction, as assessed by the Bank directly to seller

or builder or local development authority or supplier of materials etc.

Processing charges or admission fee

Processing fee equivalent to 0.5% of the loan amount (applied for) will be collected along

with the application form (taxes as applicable).

Penalty for early closure - Nil

Other Conditions

• Bank reserves the right to reject any application without assigning reasons thereof

• The applicant will undertake to inform the Bank as and when there is a change in address or

employment

The terms and conditions mentioned above and elsewhere under the scheme are subject to

modification from time to time solely at Bank's discretion.

GIMS 25

Security for the loan is a first

mortgage of the property to be

financed, normally by way of

deposit of title deeds and/or such

other collateral security as may be

necessary. Interim security may be

required, if the property is under

construction.

Home Loan: Fair Practice Code For Lenders

As directed by the Reserve Bank of India, vide circular DBOD.No.Leg.No. BC.65/ 09.07.005/2006-07 dated March 6, 2007; the Bank has adopted modified Fair Practice Code for lenders as approved by the Board of Directors. The salient features of the same are:

i) Applications for Loan

In the loan application form, the Bank shall provide comprehensive information including

information about fees and charges if any payable for processing and amount of such fees

refundable in case of non acceptance of application, prepayment options and other matter

which affects the interest of the borrowers, of all categories of loans, irrespective of the

amount of loan sought by them.

ii) Processing

a. The Bank shall provide acknowledgement for receipt of all loan applications

indicating the time frame within which the application will be disposed of.

b. The Bank shall verify the loan application and if additional details / documents

are required, these will be sought from the applicant.

c. For all categories of loans and irrespective of any threshold limits, the Bank will be expected to process the application without delay. In case the application is turned down, the Bank will convey in writing to the applicant the reasons for rejection within one month.

iii) Loan Appraisal and Terms and Conditions

a. The sanctioning authority will be expected to ensure proper assessment of the

credit application as per the extant instructions and credit policy of the bank.

The availability of adequate margin and security will not be a substitute for

due diligence on the creditworthiness of the customer.

b. All the terms and conditions and other caveats will be duly communicated by

an authorized official of the Bank to the customer in writing.

c. The acceptance of the customer will be obtained on the sanction letter with the

customer's signature under the caption A copy of the loan agreement along

with all the enclosures quoted in the loan agreement will be furnished to the

customer at the time of issue of the sanction letter.

d. The sanction letter / loan agreement will clearly state that the credit facilities

will be extended solely at the discretion of the Bank and that drawings under

the following circumstances will be solely at the discretion of the Bank.

i. Drawings beyond the drawing power / sanctioned limits.

GIMS 26

ii. Honoring of cheques issued for the purpose other than specifically stipulated

in the sanction.

iii. Drawings in an account once it is classified as NPA.

iv. No drawings will be allowed in case of non-compliance of the terms and

conditions by the borrower.

v. Meeting further requirements of the borrower on account of growth in

business will be subject to proper review of the credit limits.

iv) Disbursement of loans including changes in terms & conditions

a. The disbursement will be done immediately on compliance of all the terms

and conditions of the sanction by the borrower and the branches need not refer

to the sanctioning authority for disbursement.

b. Any changes in the terms and conditions of the sanction such as interest and

charges will be notified to the borrower before effecting the changes.

c. Any changes in interest rate and charges will be effected only prospectively

after giving due notice to the borrower.

v) Post disbursement supervision

a. The post disbursement supervision, such as submission of periodical reports

and periodic inspection, will be stipulated at the time of issue of the sanction

letter. The sanction letter would also mention whether the Bank or the

borrower will bear the cost of inspection.

b. The Bank will issue notices to the borrowers in advance in case the Bank

decides to recall the advance / accelerate the payment / accelerate the

performance under the loan agreement. Or seek additional securities.

c. The Bank shall release all securities on receiving payment of loan. However,

the Bank may decide to exercise the right to set off any legitimate right or lien

for any other claim against borrower. In case the Bank decides to retain the

security, the borrower will be notified about the remaining claims and the

documents under which the Bank is entitled to retain the security till the

relevant claim is paid / settled

v) Others

a. The Bank will not interference in the affairs of the borrowers except where

provided for in the terms and conditions of the loan sanction documents, such

GIMS 27

as periodic inspection, scrutiny of books of accounts, verification of stocks

and book debts, and scrutiny of QIS statements.

b. In case any information not disclosed earlier by the borrower has come to the

notice of the Bank, the Bank will have the right to elicit the necessary

information from the borrower and initiate action to protect its interest.

c. While, the Bank may participate in credit-linked schemes framed for weaker

sections of the society, the Bank shall not discriminate on grounds of sex,

caste and religion in the matter of lending.

d. In the matter of recovery of loans, the Bank shall not resort to undue

harassment such as persistently bothering the borrowers at odd hours and use

of muscle power.

e. In the case of receipt of request for transfer of borrowal account, either from

the borrower or from other banks / FIs which propose to take over the loan, the

Banks' consent or objection, if any, shall be conveyed within 21 days from the

date of receipt of request.

vi) Grievance Redresser

Though the sanction of the loans will be at the sole discretion of the Bank,

borrowers will have an opportunity to appeal against the decision of the

Bank's functionaries. Any such grievance received from the borrower will be

heard and disposed of by the next higher authority. For this purpose the

following review structure is available to the borrower.

Services & Charges

ICICI Home Finance ensures that you get the best Home Loans in terms of interest rates and other facilities. You can choose from Adjustable, Fixed or Floating Rate Home Loan.

GIMS 28

Charges Home Loans

Loan Processing Charges / Renewal Charges

0.5% to 1%

Prepayment Charges2% on the principal outstanding on full prepayment

Charges for late payment 2% per month

Charges for changing from fixed to floating rates of interest

1.75% on principal outstanding

Charges for changing from floating to fixed rates of interest

1.75% on principal outstanding

Cheque Swap Charges Rs. 500/-

Document Retrieval Charges Rs. 500/-

Cheque bounce charges Rs. 200/-

Note : Service Tax and other taxes, levies, etc. applicable as per prevailing rate will be charged over and above these charges.

Repayment Terms of your Home Loan

In our  endeavor to  make taking a home loan an easy process for you, we at ICICI Bank Home Loans address all your  queries  about the  repayment terms of Home Loans with respect to tenure, home loan EMIs, methods of home loans EMI payments and pre-EMI interest .

What is the repayment tenure?How is the loan repaid?What is an EMI?When does the repayment start?How is the EMI paid?What if a PDC bounces?What is pre-EMI interest?When do I pay PEMIs?

COMPARE HOUSING LOAN OF DIFFERENT BANKS

GIMS 29

GIMS 30

Loan Provider Rates of Interest

Loan Amount Loan Duration

9.5% 100000 - 2000000

1 - 5 Yrs

9.5% 100000 - 2000000

1 - 5 Yrs

9.75% 10000 - 1500000

1 - 5 Yrs

9.75% 100000 - 2000000

1 - 5 Yrs

10.5% 100000 - 5000000

1 - 5 Yrs

10.5% 100000 - 20000000

1 - 5 Yrs

10.5% 100000 - 10000000

1 - 5 Yrs

10.5% 100000 - 10000000

1 - 5 Yrs

11.0% 100000 - 2000000

1 - 5 Yrs

11.0% 100000 - 10000000

1 - 5 Yrs

11.25% 200000 - 10000000

1 - 5 Yrs

11.5% 100000 - 2000000

1 - 5 Yrs

11.5% 100000 - 10000000

1 - 5 Yrs

12.0% 100000 - 10000000

1 - 5 Yrs

FINANCIAL POSITION

GIMS 31

GIMS 32

GIMS 33

GIMS 34

STRUCTURE OF HOUSING FINANCE INDUSTRY

Housing Finance

GIMS 35

Formal SectorInformal Sector

Household savings

Disposal of Existing properties

Borrowings from friends, relatives and money lenders etc.

Government Banking Non-Banking

Central Govt.

State Govt.

Public Authorities

Commercial Banks

Cooperative Banks

Other Banks

HUDCO

Non-Banking Finance Companies

(NBFCs)

House Finance Companies (HFCs)

Non-Banking Housing Finance

Companies (NBHFCs)

Insurance LIC/GIC

Specialized Institution

HDFC

DATA ANALYSIS AND INTERPRITATION

If you are make or purchase your own home than are you like to take facility of Housing Finance?

NO. OF RESPONDENT PERCENTAGE

YES30

74% NO

1526%

TOTAL45

100%

Interpretation

The above column chart depicts that 74% person are taking home loan and only 26% are not taking home loan.

GIMS 36

1) If yes, Which Housing Finance Bank you chose?

Interpretation

GIMS 37

%

ICICI 24%

HDFC 38%

PNB 16%

SBI 19%

OTHER

3%

TOTAL 100%

Total number of respondent was 3724% person is chose ICICI bank 38% people are chose HDFC bank16% person is chose PNB bankAnd, 19% people are chose SBI bank

2) Are you aware all terms and conditions of home loans?

Interpretation

Total Number of Respondents was 37.

Many of persons know all terms and conditions of home loan i.e. 65%.

35% persons had not know properly about all terms and conditions

GIMS 38

%YES 65%NO 35%TOTAL 100%

4) How do you come to know about the home loan schemes of that bank?

GIMS 39

%

NEWSPAPER 22%

TELEVISION 16%

INTERNET 30%

OTER RESOURCES 32%

100 %

Interpretation

Total Number of Respondents was 37

22% persons came to know from newspaper

16% persons came to know from television

30% persons came to know from internet

32% persons came to know from other resource

5) Your bank offer which type of services?

GIMS 40

%

MOBILE BANKING

38%

NET BANKING

32%

FOREX BANKING

0%

OTHER 30%

TOTAL 100%

Interpretation

38 persons said that bank offer mobile banking services.

32 said that bank offer net banking services.

30% said that bank offer other services.

And no one said that bank offer forex banking services.

6) According to you which of the following banks provides optimal or economical interest rate?

%ICICI 22%PNB 22%HDFC 43%SBI 14%TOTAL 100%

GIMS 41

INTERPRETATION

The above graph shows that according to the 43% of

total sample size, HDFC provides the

optimal/economical interest rate. The next preference is

given to ICICI and PNB was providing the optimal

interest rate. i.e. 22% And only 14% of the respondent

preferred SBI.

7) Which feature of your scheme satisfied you to take it?

%LOW INSTALLMENT

46%

MAXIMUM TIME PERIOD

35%

HIGH INSTALLMENT

11%

NOTHING 8%TOTAL 100%

GIMS 42

INTERPRETATION

The above graph shows that according to the 46%

respondent satisfy, lower installment. 35% was satisfy

maximum time period, 11% was satisfy high installment

And only 8% of the respondent not satisfy any feature

of loan schemes.

8) How would you rate the overall quality of your relationship with banks of housing finance considering all of your experiences with them? Would you say it is…….

GIMS 43

NO. %

VERY GOOD 9 19%

GOOD 20 49%

FATR 14 32%

POOR 2 0%

TOTAL 37 100%

INTERPRETATION

According this chart, mostly 49% respondent rate the overall quality of your relationship with banks of housing finance “good” 32% are “fair”, 19% “very good” and no one rate in “poor”.

9) On a scale of 1 to 5 where 1 represents “extremely dissatisfied” and 5 represents “ extremely satisfied” How would you rate your level of satisfaction with banks of housing finance in regards to price?

NO. %EXCELLENT 5 14%VERY GOOD

10 24%

FAIR 20 59%POOR 10 3%TOTAL 45 100%

GIMS 44

INTERPRETATION

Mostly 59% respondent level of satisfaction is “fair” regarding to price, 24% rated in very good, 14% rated in excellent, and only 3% rated in poor .

10) In the case of suitability of EMI, which bank would you prefer?

NO. %ICICI 10 22%SBI 8 16%HDFC 15 40%PNB 12 22%TOTAL

45 100%

GIMS 45

INTERPRETATION

The above graph shows that according to the 40 percentage of total sample size, HDFC provides suitable EMI. The next preference is given to ICICI and PNB has received the third preference for providing suitable EMI. And only 16 percent of the sample preferred SBI.

SWOT ANALYSIS

GIMS 46

LIMITATION

1. Some of the respondents did not aware the terms and condition of home loan

schemes.

2. Some of the respondents did not answer all the questions. This could hamper

the final results to a certain extent.

3. We had limited time for conducting this survey report.

4. The study confines itself to the respondents of “BILASPUR” only. Hence

findings would not be relevant to other cities.

5. People mind set about the survey was an obstacle in acquiring complete

information & positive interaction.

GIMS 47

STRWNGTHS 1)An active

mainstream sector .

2)Effective regulatory framework.

3)Extensive network of regional bank microfinance institution, cooperatives credit unions and rural bank.

WEAKNESSES

Interest rate war persistent

Dilution in due diligence on part of leaders is a often seen.

Lack of uniformity of norms.

Increase in default rates.

OPPORTUNITIES Increasing

urbanization.

Housing microfinance has potential.

Tax rebates on house loan.

Falling interest rates.

THREATS

Lower transaction levels in realty sector.

High switching costs of customers.

Higher cost of home ownership is mainly depending the demand at other end.

6. Respondents were very busy in their schedule. So it was very time consuming

for them to answer all the questions properly.

FINDING

1) According to this project report 74% interested in housing finance.

2) 38% people like to take HDFC bank home loan. Because this bank give well services.

3) I am finding in this project serve more bank use new technology like: internet banking, mobile banking, and forex banking.

4) According to this serve customer satisfied low installment schemes of bank.

5) 72% people did not face any difficulty during takingthe loan

6) Mostly people recommended HDFC bank of hosing finance.

GIMS 48

SUGGESTION AND CONCLUSION

SUGGESTION

1. There is more time period for repayment of home loan.

2. Housing finance institution take steps to solve customer problems immediately.

3. Loan sanction date should be according to customer convenient.

4. A customer awareness program should be taking place in rural area.

5. Housing finance bank take feedbacks of customers regarding features & services

6. For the better service new offers would be require.

7. Bank should give all information related to terms and condition.

GIMS 49

8. To make people aware about the benefit of becoming Housing finance Bank’s Sales Executive, following activities of advertisement should be done through

9. Print Media.

10. Hoarding & Banners.

11. Distribution of leaflets containing details information

12. Make people understand about the various benefits of its products..

CONCLUSION

Housing is a growing industry. Various public and private institutions have

entered in this field. These institutions have initiated various house financing

schemes to cater the diversified needs of this sector.

Besides the emerging and expanding institutional set up, the system of credit

delivery of housing is still inadequate. The responsibility to provide house

finance largely was rested with the Central Government till the early eighties.

GIMS 50

The setting up of the NHB in 1988, as the apex housing finance institution,

was the beginning of the emergence of housing finance as a fund based

financial service in the country.

Its role fall into three categories promotional, financial and regulatory.

Housing finance institutions must become self sustaining units which work

on full cost recovery basis and device innovative financial instruments to

mobilize their resources from household sector.

BIBLIOGRAPHY

Internet

Catalogs

“Research Methodology” -“C.R.Kothari”.

GIMS 51

QUESTIONNAIRE

1) If you are make or purchase your own home than are you like to take facility of Housing Finance?

A. Yes B. No

2) If yes Which Housing Finance Bank you chose ?

A ICICI Bank B HDFC BankC Punjab national bank D SBI bank

3) Are you aware all terms and conditions of home loans?A Yes B No

4) How do you come to know about the home loan schemes of that bank?A News paper B TelevisionC Internet D Other resources

GIMS 52

5) Your bank offer which type of services? A Mobile banking B Net banking

C Forex banking D Other

6) According to you which of the following banks provides optimal or economical interest rate? A ICICI B PNB

C HDFC D SBI

7) Which feature of your scheme satisfied you to take it ?

A Low installment B Maximum time period

C High installment amount D Nothing

8) In the case of suitability of EMI, which bank would you prefer?A ICICI B SBI

C HDFC D PNB

9) Are you satisfy by the time taken in sanctioning the loan?A Yes B No

10) And, IN case of long term which bank would you choose?A ICICI B SBI C PNB D HDFC

Signature

GIMS 53