ASUMMER TRAININGREPORT

ON

COMPARISON OF HOME LOAN SCHEME OF DIFFERENT BANKS

SUBMITTED TO SUPERVISOR NAME

SUBMITTED BY YOUR NAME

ACKNOWLEDGEMENT

Perfect is the famous saying and when a person get practical experience under the guidance of expert of the respective field, the knowledge gained is priceless.

With the sense of great pleasure and satisfaction, I present this project report entitled COMPARISON OF HOME LOAN SCHEME OF DIFFERENT BANKS completing a task successfully is never a man efforts similarly completion of this report is the result of invaluable support and contribution of number of the peoples in direct and indirect manner. In the light of foregoing, first of all my heartfelt great fullness and thanks goes to Mr. SUMIT SURI as a MANAGER of HDFC LIMITED for giving opportunity to work for his highly esteemed organization and for being a constant source of inspiration and guidance throughout the project. Without his able support the project would not have seen the light of the day.

At this juncture, I would also like to thank all the other team members of the HDFC LIMITED. Without their indispensable cooperation, the project wont have been completed within the stipulated time period. Finally I would like to thank the staff of other home loan provider banks, without whose cooperation in providing the data for the project would have been impossible.

PREFACE Modern organizations are highly complex ad dynamics systems. They operate under very turbulent social economic and political environment. They are required to reconcile several incompatible goals. Conflicting roles and divergent interest they are also fraught with the use risk and uncertainties, hence tactful management of such organization to plan to execute guide, coordination and control the performance of people to achieve predetermined goals. Management has to keep the organization vibrant moving and in equilibrium. It has to achieve goal which themselves are changing it is therefore a problem highly complex and ticklish.

This information will be asset to marketing manager in making effective decisions. The researchers are used to acquire and analyze information and to make suggestions to management as to how marketing problems should be solved.

The marketing research is the process which links to manufacturer, dealers and individuals through information in important part of curriculum of M.B.A. programme is project taken by the students to institute under which he or she is studying, after completion of third semester of the programme.

The objective of this project is to enable the students to understand the application of the academics in the real business life. I am fully confident that this project report will be extremely useful to the management.

INTRODUCTION

The roof over ones head and ground beneath ones feet count as the bare necessities of life. Theres nothing quite like owing a home, however humble to give that warm and glowing feeling. But when one buys a home, one has much more than a feel good purchase in mind! Its also a crucial investment decision, perhaps the biggest spending decision of ones life. There are ample opportunities today for young salaried investors to plan their moves early and buy a house at right time- and at right price. In the process, not only do they fulfill that cherished dream of owning a house, but also put themselves on the path to acquiring property that would meet the needs and aspirations of their growing family, even as it leads to wealth creation. Every individual aspires to own a home. But many either spend a lifetime saving to purchase a house or exhaust money on monthly house rents

OBJECTIVE OF THE STUDY:

The main objective of the study is to find out the tariff changes charges by other banks in comparison to HDFC bank.

The aim of the study is to help HDFC to know where it lacks in loans and how far the performance of other banks is better so that HDFC figure out the common problems being faced by the customers while dealing in the loan department so that further HDFC can improve its services and schemes offered by them to their customers.

PROFITABLE PROPOSITION

The overall demand in residential sector has grown by about 7-8% in the past few months as compared to the same period last year. The growth is on account of two main factors:

One, income tax exemption. Two, with no similar rebates available for individuals in the high income group, they are creating a second asset.

Add to this the stable property prices over the last year and plunging interest rates, planning for dream,] home could not have been better timed. Rock-bottom interest rates, standardization of periodicity of interest calculation across lenders (which make it easier to compare loans), lower interest charges, waiver of loan application processing fee and a customer friendly attitude is reason enough to celebrate the ascension of the home loan consumer as the king.

In response, private players like ICICI Bank, IDBI Bank, Standard Chartered Bank and few others too lowered their rates.

Market leader HDFC also brought down its interest rate to 10.25% very recently, to participate in the interest rate war. If one is still not satisfied with the lowered loan rates theres more.

Most banks have changed the way the interest is calculated from annual rest to monthly rests. Under the annual rest method, the EMIs (equal monthly installment) one pay through a year, are factored in as part-repayment of the principal component only at the end of each year. In other words one has to pay interest even on the installments one has paid until they are reduced from the principal at the end of each year. Under monthly rests, the principal is lowered by the appropriate amount each month. The thumb rule being that the more frequently interest is calculated, the better for the creditor.

HDFC added monthly rests on its fixed interest loans apart from annul rests. As a result the fall in the EMIs on fixed interest loans (where the interest rate is constant for the entire tenure of the loan, irrespective of the changes in the lending rates) is more pronounced than on floating rate loans (where the loan interest rate varies with the changes in the interest rate). For example, the EMI on a fifteen year fixed interest loan for Rs. 15 lakh has come down by Rs. 15 lakh has come down by Rs. 840, the corresponding fall in the EMI on a floating rate loan is only 4165. apart from lowering the cost of ones loan, the switchover to monthly rests has another advantage : it makes it easier to compare loans. HOME LOAN

Home loans are loans you have access to, depending on whether you want to buy or build a house and can also be used to repair or extend an existing house.

Who can avail of these loans?

According to lending institutions, any Indian resident who is over 21 years of age at the beginning of the loan and below 65at its maturity can avail of the loan. Salaried Employees as well as Self- Employed citizens can apply. NRI Salaried and RBI Self Employed, under RBI guidelines, can approach only nationalized banks and other HDFC for loans.

Why should one option for a loan to buy a house?Taking a loan seems like a good option when the money at hand is insufficient to buy the house of your dreams. Consider couples in their twenties and thirties. They enjoy a good income currently, buy their accumulated capital isnt enough to purchase a house. Whereas a home loan can give them access to capital their current earnings.Also, if you take a 10 years old loan when you are thirty, you could repay it by the time youre forty. So you dont have to be burdened with the interest and are free to plan your retirement savings.

The Quantum of loan that one can avail of : Loan sanctioned depend on your repayment capacity which is based on your current income and your future repayment capacity. You would include your spouses name to enhance the loan amount.The maximum loan can be sanctioned varies with each bank/institutions and ranges from Rs.10 lakhs to Rs. 1 crore.

Benefits of taking a home loan: A home loan is very different from a personal loan like a car loan for instance. You can utilize a home loan for financing an asset that will hold its value and even appreciate over the period of the loan. Though its price could fluctuate in the short terms, Total Estate will show capital appreciation over the years. The value of your house generally while the loan remains constant. If you had opted to wait, save up and buy a house, it would, in the long run cost you much more; home loans also come with many tax benefits.

Tax benefits of taking a home loan:The income tax authorities look with favor upon those servicing a housing loan from specified financial institutions. And, it is up to you to be wise enough to take advantage of this.

Section 24 of the Income Tax: Interest on loan till Rs.2.5 lakhs per annum is exempted from income tax (under section 23/24(1) of the Income tax act).

Section 88 of Income Tax Act:

Financial Institutions, which give, home loans: Leading Banks Housing finance companies

FINANCIAL IMPLICATIONS OF AVAILING A LOAN (SMALL OR BIG)

There are several expenses involved apart from repayment of the actual loan amount:

1. Processing fees- A processing fee (PF) is charges at the time of submission of the application form and covers expenses incurred for processing the application form. This fee has to be paid upfront by the customer in some cases, it is non-refundable.2. Administration fees- to meet operating expenses.3. Pre-EMI- A simple interest calculated on the disbursement amount in case of a plot under construction.4. EMI- The EMI is an abbreviated form of the equated money installment and is simply referred to as monthly installment in common parlance. And, being a self-explanatory term that is exactly what it is. The amount you will have to pay you financier every month when repaying your loan. Being a monthly payment, at the end of the year, you would have paid 12 EMIs.

TYPES OF LOANS AVAILABLE

Broadly two types- fixed rate and variable rate loans; while the former deals with a fixed rate of interest over the entire duration of the loan, the latter has the rate of interest changing according to the fluctuations in the market.

LOAN THAT ONE CAN AVAIL

Up to 85-90% of the total cost based primarily upon the individuals payback capacity.

GENERAL CONDITIONS THAT GOVERN A HOME LOAN: These are likely to vary with respect to the different types of housing loans:

The maximum period of the loan is normally fixed by HFIs. However, HFIs do provide for different tenors with different terms and conditions. The Installment that you pay is normally restricted to amount 45% of your monthly gross income. You will be eligible for a loan amount, which is the lowest as per your eligibility. This is calculated on the basis of your gross income and payback capabilities. Some HFIs insist on guarantees from other individuals for due repayment of your loan. In such cases you have to arrange for the personal guarantee before the disbursement of your loan tasks place. Most HFIs have a panel of lawyers who go through your property documents to ensure that the documents are clear and are not misrepresented. This is an added benefit that you get when you avail of a loan from an HFI. You repay the loan either through Deduction against Salary, Post dated cheques, and standing instructions or by Cash/DD.

WHAT ALL ONE CAN TAKE THE LOAN FOR?

There are different types of home loan tailored to meet ones needs heres all some of them.

Home purchase loan: This is the basic home loan for the purchase of new home. Home improvement loans: These loans are given for implementation repair works & renovation in a home that has already been purchased by the client. Home construction loan: This is available for the construction of new home. Home extension loan: This is given for expanding or extending an existing home for e.g.: addition of an extra room etc. Home conversion loan: This is for those who have financed the present home with home loan & wish to purchase& move to another home for which some extra funds are required through home on version loan ,existing loan is transferred to the new home including the extra amount required eliminating the pre payment of the previous loan. Land purchasing loan: this loan is available for the purchasing of land for both construction and investment purpose. Bridge loan: these are designed for those people who wish to sell the existing home & purchase another one. The bridge loan help finance the new home, until a buyer is found for the home.

HDFC BANK INTRODUCTION

HDFC (Home Development Finance Corporation) Home Loan, India have been serving the people for around 3 decades and providing various housing loan according to their varied needs at attractive and reasonable interest rates. Owing to their wide network of financing, HDFC Home Loans provide services at doorstep and helps you find a home as per your requirements. COMPANY PROFILE

HDFC Limited founded in 1997 by Ravi Maurya and Hansmukh bhai Parekh, is an Indian NBFS focusing on home loans. HDFC operates through almost 450 locations throughout the country with its corporate head quarters in Mumbai, India. HDFC also has an international office in Dubai, UAE with service associates in Kuwait. HDFC is the largest housing company in India for the last 27 years.HDFC was amongst the first to receive an in principal approval from RBI to set up a bank in the private sector, as a part of the RBIs liberalization of the Indian banking industry. It was incorporated on 30th august 1994 in the name of HDFC Bank Limited, with its registration office in Mumbai. HDFC began its operations as a scheduled commercial bank on 16th January 1995. ABOUT THE PROMOTER

HDFC, the promoter, is Indias premier housing finance company and enjoy an impeccable track record in India as well as in international markets.

Since its inception in 1997, HDFC has maintained a consistent growth in its operation and profitability. Its outstanding loan portfolio covers over a million dwelling units. HDFC has developed significant expertise in retail mortgage loans to different market segment and also has a large corporate client base in relation to its housing related credit facilities and its investment in portfolio.

With its tremendous brand equity, the strong reputation in the Indian and international financial services market, large shareholder base and unique consumer franchise, HDFC was ideally positioned to promote a bank in the

Indian environment. HDFC (together with its fully owned subsidiary HDFC Investment Limited) owns about 31 % of the equity. They had started with a strategic alliance with the Natwest group in UK with 20% equity, which has divested later on. The bank has also signed a memorandum of understanding for strategic business collaboration with chase Manhattan Bank in Feb. 2, 1999.BUSINESS PHILOSOPHY

The mission of the HDFC Bank is to be world class Indian bank. This would imply a bank that would meet various financial needs of its customers in a convenient and cost effective manner at international standard of service.

The bank seeks to achieve the status of a preferred organization among its major constituents- customers, shareholders, regulators, employees, suppliers etc. while maintaining the highest level of integrity and corporate governance.

The business philosophy at HDFC bank is based on four core values: operational excellence, customer focus, and product leadership and people competitors.

The Bank faces the strong competition in all of their principal lines of business. Their primary competitors are large public sector banks, other private sector banks, foreign banks and in some product areas, non-banking financial institutions.

WHOLESALE BANKING

Principal competitors in wholesale banking are public and new private sector banks as well as foreign banks. The large public sector banks have traditionally been the market leaders in the commercial lending. Foreign banks have focused primarily on serving the needs of multinational companies and the Indian corporations with cross- border financing requirements including trade, transactional and foreign exchange services, while the large public sector banks have extensive branch networks and large local currency funding capabilities.

RETAIL BANKING

In retail banking, their principal competitors are the large public sector banks, which have much larger deposit bases and branch networks,, other new private sector banks and foreign banks in case of retail loan products. The retail deposit shares of the foreign banks are quite small in comparison to the public sector banks, and have also declined in the last five years, which we attribute principally to the competition from new private sector banks. However, some of the foreign banks have a significant presence among non-resident Indians and also compete for non-branch based products such as auto loans and credit cards. They face significant competition primarily from foreign banks. In provision of debit cards and also expect to face competition from foreign banks when we begin offering credit cards. In mutual fund sales and other investment related products, their principal competitors are brokers and foreign private banks.

TREASURY

In treasury advisory services for corporate clients, the compete principally with foreign banks in foreign exchange and derivatives trading as well as SBI and other public sector banks ion the foreign exchange and money market business.

LOANS

HDFC brings back you a wide range of loans to cater your financial needs.The bank offers the following loans:

1) Personal loans.2) Consumer loans.3) Auto loans4) Loans against shares5) Loans against RBI bonds6) Loans against insurance policy7) E- Instant loans give the facility of loans approval in the 60 second on the internet.8) HDFC has offices spread all over the country. This extensive network helps HDFC in providing services to large and well spread out clients. This network of interconnected offices (on data circuits) helps HDFC to process application for purchase of property anywhere in India. HDFC has further established an office in Dubai and service associates in Kuwait, Oman and Quarter to make to easier for Middle East based non-resident Indians to apply for loan to HDFC-India.9) HDFC is pioneer of housing finance in India and has been a leader in business for the last 23 years. HDFC has vast experience and a very committed and skilled staff to handle housing loan applications and solving customer problems.

HDFC LOAN SCHEME PURPOSE

HDFC Limited offers loans for the following purposes:

Land purchase Home construction/purchase Home extension Home improvement loans Short-term bridge loans Non-resident premises loans for professionals.

LOAN AMOUNT You can avail of maximum of up to 85% of the cost of the property, including the cost of the land.

LOAN TENURE

You can repay the loan over a maximum period of 20 years under both FRHL and ARHL. Repayment will not ordinarily extend beyond your age of retirement (if you are employed) or on your reaching 65 years of age, whichever is earlier. However, HDFC will endeavor to determine the repayment period to suit your convenience.

RATE OF INTEREST

The rate of interest of HDFC is 8.75%.under the monthly rest option, interest is calculated on monthly rests. Principal repayment is credited at the end of every month.

At HDFC you have the choice between the normal FRHL and the innovative ARHL. Alternatively you can also avail the part of the loan under FRHL and balance under ARHL.HDFC also offers you the option to switch between schemes for the nominal fee. Interest rates on ARHL will be linked to HDFCs Retail Prime Lending Rate (RPLR) which currently is 16.75% .The rate on your loan will be revised every three months from the date of first disbursement, if there is a change in RPLR, i.e. 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 the term of the loan, and vice versa when the interest rate decreases).customer will be provided with an annual statement indicating the details of the interest and principal payment made during the year.

SECURITY

Security for the loan normally is first mortgage of the property to be financed and/or such other collateral security as may be necessary. Interim security may be required, if the property is under construction. Collateral or interim security could be assigned to HDFC of life insurance policies, the surrender value of which is at least equal to the loan amount, guarantees from sound and solvent guarantors, pledge of shares and such other investments that are acceptable to the HDFC.

Loans from HDFC are available even if you are availing a housing loan from your employer. HDFC has already entered into arrangements with several employers enabling employees to avail of loans both from the employer as well as HDFC for the same property. Please do ensure that the title of the property is clear, marketable and free from encumbrance. To elaborate there should not be any existing mortgage, loan or litigation which is likely to affect the title to the property adversely.DOCUMENTS/SUPPORTING DOCUMENTS TO BE ATTATCHED:

FOR ALL THE APPLICANTS:

1) Allotment letter of the co-operative society/association of the apartment owners.2) Copy of approved drawings of proposed construction/purchase/extension.3) Agreement for sale/sale deed/detailed cost estimate from architect/engineer for the property to be purchased/constructed/extended/renovated.4) If you have been in your present employment/business or profession for less than a year, mention an a separate sheet details of the of the occupations for previous five years, giving position held, reason for change and period of same.5) Applicable processing fees.6) Proof of residence: attested copy of any one of the following:

a) Ration cardb) Passportc) Driving licensed) Voters identity carde) Current telephone bill/electricity bill/gas bill7) Proof of identity: attested copy of ay one of the following:a) Passport b) Driving licensec) Voters identity car5d identity card issued by the employer (if employed in state/central government)d) PAN card8) Certificate of loan outstanding issued by the lender (for refinance cases only)9) Any other information regarding your repayment capacity that is necessary and will assist HDFC in appraising the loan proposal.

ADDITIONALLY

IF YOU ARE EMPLOYED:

1) Verification of the employment form with only part I filled in.2) Latest original salary slip/salary certificate showing all deductions.3) If your job is transferable, permanent address where correspondence relating to the application can be mailed.4) A letter from your employer agreeing to deduct the EMI towards the repayment of the loan from your salary. This will expedite the processing of your loan application.5) Your updated original bank pass book/s or original bank statement/s showing salary and saving entries for the last six months.6) A photo-copy of your Form-16 (issued by your employer) for the last assessment year.

IF YOU ARE SELF EMPLOYED:

1) Balance Sheets and Profit & Loss Accounts of the business/profession along with copies of individual income tax returns for the last three years certified by the Chartered Accountant.2) A note giving information on the nature of your business/profession, form of organization, clients, suppliers, etc.3) Copies of individual tax chalans for the last three years4) Copy of advance tax chalan (if any)5) Your updated original Bank Pass Book/s or Original Bank Statement/s showing saving s entries for the last twelve months.

TAX BENEFIT

You are eligible for certain tax benefits on principal and interest components of a loan under the Income Tax Act, 1961.

ELIGIBILITY

The repayment capacity as determined by the HDFC will help in deciding how much we can borrow (the cost of the property or Rs.1crore whichever is lower). Repayment capacity takes into consideration factors such as income, age, qualifications, number of dependents, spouses income, assets, liabilities, stability and continuity of occupation and saving history. And, of course, HDFCs main concern is to make sure you can comfortably repay the amount you borrowed.

ABOUT THE PRODUCT

HDFCs Home Loans offers you various unique benefits and are easy to arrange and repayable in easy monthly installments. The terms of the loan can be structured according to the customer requirement.

Home loans can be applied for by either individually or jointly. Proposed owner of the property, in respect of which the loan is being sought, will have to be co-applicants. However, the co-applicants need not be co-owners. Loans can avail up to a maximum of 85% of the cost of the property (including the cost of the land). HDFC lends up to a maximum of Rs. 10000000 on a home loan to an individual. You can repay the loan over a maximum period of 20 years. They determine the loan amount after evaluating the repayment capacity of the individual. HDFCs main concern is to help individuals comfortably repay the borrowed amount.

SUPERIOR PROCESSING CAPACITY:

HDFC has over the years invested substantially into the computer systems and training. This has enabled HDFC to respond to customer needs and build up capabilities to approve loan on the spot or disburse them fast.

BRANCH NETWORK:

HDFC has offices spread all over the country. This extensive network helps HDFC in providing service to large and well spread out clients. This network of interconnected offices (on data circuits) helps HDFC to process applications for purchase of property anywhere in India. HDFC has further established an office in Dubai and service associates in Kuwait, Oman, Qatar, Bahrain and Saudi Arabia to make it easier for Middle east based non-resident Indians to apply for the loan to HDFC-India.

EXPERIENCED TRAINED STAFF:

HDFC is a pioneer of housing finance in India and has been a leader in the business for the last 25 years. HDFC has vast experienced and very committed and skilled staff to handle housing loan applications and solving customer problems.

FREE COUNSELLING:

HDFC believes that it is in the business of providing solutions to an individuals need for owing a house, and not just in the business of providing finance. Keeping this in mind HDFC will provide free counseling to on how and where to buy a house in India (property services) or what are the prices and trends in the real estate market or what precautions one should take before buying a house. This service is offered at any of the HDFCs offices.

LEGAL AND TECHNICAL GUIDANCE:

HDFC has qualified legal and technical staffs who liaise with developer to collect and scrutinize the property documents and permissions. We have master files of most projects being developed by the reputed developers. It has always been HDFCs endeavor to protect the interest of the borrower, as we believe that the buying a house is one of the most Important decisions in this life.

FLEXIBLE (CUSTOMIZED) REPAYMENT SCHEMES:

Keeping in mind the fact that each individual has unique problem requiring unique solution, HDFC has developed various repayment options like Step Up Repayment Facility (SURF), Flexible Loan Installment Plan (FLIP) Balloon Payment plan and Structured Repayment Plan.

STEP UP REPAYMENT FACILITY

HDFC Ltd has a hitherto with you, right through .This statement HDFC proves time and Again by developing close relationship with individual customers and by constantly Developing and marketing in the market new and innovative products that increase theComfort level of the customers. Along the same philosophy HDFC came up with Step Up Repayment Facility which once again reassures customers that HDFC helps you achieve your dream.

This facility is especially helpful to those customers who want to get a loan on an amount that is not falling within the permissible limit of their repayment capacity. It also is in line with HDFCs aim to provide greater degree of personalization in service and the tools. Hence there can be the situation wherein the applicant is not in the position to pay the required EMI which is calculated by the ILPS (Individual loan processing system).HDFC in this case offers to let the applicant use one of the two plans to repay the loan amount.

The EMI Chooser 1

In this plan the applicant gets the advantage from HDFC to select the amount that he wants to pay as his fist EMI. This means that HDFC will let the applicant decidewhat amount he can comfortably pay to HDFC in the first term of his Loan Repayment Schedule. The system will calculate the next two EMIs for the next two terms The customer can hence decide when he wants to repay the maximum amount of the Loan to HDFC and when he wants to repay minimum leftover or remaining amount of the loan in the form of still smaller EMIs.

The EMI Chooser 2

This plan is an extension of the aforementioned plan .In this plan HDFC helps the Applicant by letting him choose two EMIs .This means that the Applicant can select the amount that he wants two pay for both the First and the Second terms of his repayment schedule. This translates into more help and more convenience to the applicant. However the benefits of these plans dont stop here.

The Applicant can also allocate the term length for which he wants to pay what amountThis translates into a great advantage to the Applicant .He can now link

1. His current salary2. The rate of average increment,3. His existing and expected obligations, 4. His existing and expected expenses 5. The length of the term among others.

HDFC can hence assist the Applicant in developing a much more personalized loan plan as compared to its competitors in the Housing Loan market.

The Applicant can also save money by using these plans .This is because the total Outflow in case of a regular plan is more as compared to these special plans. The Applicant will hence obtain more benefit in case of Prepayment and elsewhere.

C. All Loans from HDFC Ltd are subject to Tax exemption and be treated as Rebate. Hence HDFC lets the customer save their hard earned money.

FLEXIBLE LOAN INSTALMENT PLAN (FLIP) Another First of its kind product from HDFC .This is also to assist the Applicant to easily secure a loan in the following condition. FLIP is used when the applicant and co-applicant want to jointly repay the loan. There is however a problem in the situation which would otherwise not allow the loan to be sanctioned. There are two applicants hence two incomes .Therefore in the joint payment they can combine their income to repay the loan .Let there be Mr. A and B who want to take a loan for 14 years .A is the father and B is the son of A .Now consider the situation in which A and B want to take a loan and jointly repay it .But A is 52 years old and B is only 25 .Hence A will retire after 8 years and will not be repaying the EMI but B can continue to repay the loan. In that case although there will be a problem at other places but in HDFC this is solved by taking different incomes in the terms. Hence the income that will be considered earlier will be the fathers income and at his retirement or at any other selected stage of repayment we will begin to consider only the income of the son.

The advantage of FLIP in terms of the Applicant is that of joint payment, personalization, easy repayment, and freedom from many possible problems. In the Illustration the father is going to pay only for 105 months and after that we are to consider the sons salary only for the next remaining 60 months.

PARI PASSU/SECOND MORTGAGE ARRANGEMENT:

HDFC has a tie-up with a large number if public sector organizations and banks which enable us to offer loans to your employees with the flexibility of their spouse also availing a loan from his/her own employer.

SAFE DOCUMENT STORAGE FACILITIES:

HDFC has state of art storage facilities which are theft and fire proof, at various locations where loan and property documents are stored. In this way valuable documents are stored safely over the period of the loan and are released almost immediately after a customer repay his loan.ELECTRONIC MAIL:

HDFC through its E-mail services can promptly respond to queries. In addition, HDFC can promptly send its application form cum brochure and other detail on its loan products by e-mail to interested individuals. For Non-resident Indians our interactive website offers another means of contacting us. In our effort to reach out globally dispersed Non-resident Indians, we will continuously enhance our website.

HOME CONVERSION LOAN:

HDFC offer the option of a home conversion loan to its existing customer who are interested in moving to a new house. Through this scheme the customer can apply to have their existing loan transferred towards the purchase of the new home. Customers may also apply for an additional loan amount for the purchase of the new house. This gives the customers the option of selling t6heir existing house if they wish to, without having to repay their old loan

APPLICATION CAN BE MADE BEFORE SELECTING THE PROPERTY:

Individuals may make an application for the loan even if the property has not been selected or the construction has not commenced. HDFC can provide assistance in locating an appropriate house to such customers.

HOME IMPROVEMENT LOANS:

As an exclusive offer to its existing customers HDFC offers Home Improvement Loan up to 100% of the improvement cost as compared to the home improvement loans up to 70% of the improvement cost offered to the general public.

FEE:

A processing fee of 0.5% of the loan amount applied for rs.5 per rs.1000 of the loan applied for is payable when the application form is submitted to HDFC. This fee is in the respect of costs incidental to the application. For example:

Loan applied for fees

Rs.20000Rs.100Rs.100000Rs. 500

On approval of the loan, a loan offer is made to you on acceptance of the offer. You have to pay an administrative fee of Rs.0.5% of the loan approved. You can also pay the processing fee and administrative fee upfront i.e. 1% of the loan at the time of submission of the loan application itself. This fee is in respect of the costs incidental to the application. Taxes as applicable will be charged on the fees collected.

CHARGES:

For Fixed Rate Home Loan (FRHL) an early redemption charge of 2% of the amount being prepaid is payable, if the amount being repaid is more than 25% of the opening balance. However under Adjustable Rate Home Loan (ARHL) option early redemption charges of 2% is payable only in case of commercial refinance. You may be required to submit the copies of your Bank Statements or any other documents that HDFC deems necessary to verify the source of prepayment.You can make payment for fees and charges by cheque marked payees account only drawn on a bank in a city where HDFC has an office or by demand draft (payable at par to HDFC).

HOW TO APPLY

Customer can either download (in PDF format) the application form or get the application form by E-mail. Alternately the customers can collect the application form from any of your nearest HDFC offices. Customer need to submit it along with supporting documents and processing fee at any HDFC office that is convenient to the customer. Customers can make payments by the cheque marked payees account only drawn on a bank in a city where the HDFC has an office, by demand draft (payable at part to HDFC) or by cash. Customer can make an application at any time after they have decided to acquire a house even when the house has not been selected or construction has not commenced.HDFC will consider your application, make enquiries as it deems necessary and convey its decision to you. On acceptance of the offer, you will have to pay an administrative fee for the loan approved. Customer can take the disbursement of the loan after the property has been completed and you have invested your own contribution in full (own contribution is the total cost of the property less HDFCs loan). The loan will be disbursed in full or in suitable installments (normally not exceeding three in number)taking into account the requirement of the funds and the progress of the construction, as assessed by HDFC and not necessarily according to the builders agreement.

Application Form

Processing Fees

Documents Requirement

Personal Discussion

Investigation verification

Sanctioning of Loan

Acceptance of Loan

Disbursement of Loan

Application Form:It is the 1st document which bank will be using as base for sanctioning the loan. It generally includes your personal information, contact details, property details, total (various)costs involved in buying property, loan amount required, your income details, tenure required. The application has to be accompanied with Processing fee check, read on.Processing Fees:As you will be given a Loan Application Form, you will be asked to deposit a processing fees along with filled Application form and documents. This processing fees varies from bank to bank. (Tip negotiable to wave this fees.)Caution: Please check with your bank that up to when(Time Frame) the processing fees is valid, based on your final disbursement of loan is scheduled to happen after the validity, (Generally its the case with new/under constructed projects/societies) then its possible that to disburse the loan amount you have to give the processing fee again tobanksto get loan disbursed.Documents:Based on the loan application you have to submit the documents as per our page Documents required for Home Loan.Personal discussion:This will happen more or less on the same day/simultaneously when you submit your documents. Bank will try to probe the reason for buying the property. Try to divert the discussion towards your qualification so that with age/time your income will grow and you could pay more EMI. Bank also tries to verify during the discussion that, the mentioned items in the application form are correct. These days this activity has become the primary activity once you meet the bank official.Investigation verificationMany people do apply for home loan. Many are not even eligible for same. In order to check this, banks verify you personally. They try to visit your companys office and meet you personally in office. Often they visit your residence as well. No harm, cooperate fully in this activity. This will bank increase surveyor confidence on you ratherLoan sanctioning/Loan sanctioning letter:After the above few steps the bank will give you the loan sanctioning letter. It has the details of the amount of loan sanctioned by bank. Final loan amount sanctioned and your loan eligibility are two different things. Once you know what you are eligible to get, you can decide on the loan amount. Just because you are eligible for a huge sum does not mean you should borrow heavily. The loan sanctioning letter is an important document, keep it safe, may be useful if there is any dispute.what are all the points you need to check in the letter? Loan sanctioned amount Interest rates (Fixed or floating and related to which reference rate e.g. Base Rate) Tenure of Loan EMI Amount, mode of payment (Cheque or ECS) Conditions/Charges on prepayment of loan Special scheme if any available. Validity of the Loan sanctioning letter (Generally 6 months) Any other terms and conditions.(Read carefully into the fine print)Acceptance of Sanction Letter:If agreed to all the conditions of the loan, return the same by signing on the letter (duplicate copy) to Bank.Note 1: If there is any thing missing or Interest rate on the letter is the same that was discussed and agreed upon, If no, bring this to Banks notice.Note2: Loan sanctioning and loan disbursement are 2 different process.You can get 2 crore sanctioned but may not be able to disburse same because of improper papers of property. Bank will sanction loan by seeing your credit worthiness/ability to repay, but will disburse the loan by seeing your property and its appropriate papers. Once you sanction the loan, immediately start collecting original property papers, as without them you cant get the loan disbursed.Loan disbursement/Property Assessment: Once you get the loan sanctioned now you have to get the loan disbursed. For disbursing the loan you have to submit all the property papers, payment receipts in original to bank which will be kept as security for loan amount given to you. All the papers will be kept by bank till the loan is fully repaid. Bank will do the following with the papers.a. Legal Check:Every bank conducts a legal check on your documents to validate their authenticity. Hence, Sometimes it helps to buy property from a reputed developer since they know the process inside out, and keep all the documents upfront.Home loan is also the cheapest way to get the property assessed by an individual as Property documentation in India is still non-transparent.Thus home loan assures that the property you are buying has all the legal titles clear, and your investment is safe.b. Technical check:Banks take utmost care in their plan to finance the property. They send an expert to visit the premises you intend to purchase.In case of under construction property Stage of construction is the same as that mentioned in the demand given to you by the builder. Quality of construction and Satisfactory progress of work. Layout of flats and property is within permissions granted by the governing authority. The builder has the requisite certificates to start construction at the site. Valuation of the property in relation to other deals in the surrounding areas.In case of ready/resale construction External / internal maintenance of the property. The age of the building. Quality of construction. Surrounding area (development). Whether the builder has received the requisite certificates for handing over possession of the flat. There is no existing lien or mortgage on the property. Valuation of the property in relation to other deals in the surrounding areas. These inspections are carried out to protect consumer interests in terms of construction quality, adherence to local laws, approved building plans, etc. A technical inspection also lets the bank understand the progress of construction so as to release the staggered disbursements. Signing the home loan agreement: All borrowers need to sign the home loan agreement. The original property documents have to be handed over to the bank at this stage. Check the details of the agreement, and see that there are no hidden charges/conditions that may prove to be costly later.Disbursement of loan: Now the big day has come where in you are now eligible for the loan disbursement to the builder, re seller (for resale flats), society or the development authority. But this will happen only if all the papers relating to the property are proper and as per bank requirement, All receipts of payments have been submitted in original and loan agreement have been executed.

RESEARCH MYTHODOLOGY

Research methodology is an important part of every project. Because it helps in knowing how to select the representative sample from the world or the general population, the right research tools and techniques to complete the research.The study of the consumer behavior is important because he is the king. The research process is based upon survey method, so in order we go to service provider and services user which is the customers.The research involves the following steps:

Define the problem and research objective: The problem and objective is to assess the services offered by the various service providers and what the customer wants. Developing the research plan: The second stage of the research methodology is to develop a research plan. The research plan designed to take the decision on the data sources, research approaches, research instruments, sampling plan and contact methods. Survey research: It was a descriptive research. Research instrument: The use of an effective research instrument is very important because through this instrument we collect data in this project through observations and personal interview were conducted. Personal interview: as we were doing direct selling we interacted with my customers and asked about their views in selecting a service and what are their wants and expectations from a service provider. Sampling plan: After finalizing the research approach and instruments a sampling must be designed. Sampling unit: Data have been collected from banks. Sampling size: It has been collected from four banks. Sampling procedure: what process should be used to collect the sample. So, representation sample, convenience sampling is used. Collect the information: After completing all the steps, the data are collected from different sources. Analyze the information: After the data is collected they are analyzed to know the findings. The data is then tabulated to develop the frequency distribution. Present the findings: As the last step, the findings are presented that are relevant to the major marketing decisions.

ANALYSIS OF DATA

The home loans provided by the banks are more or less same at the basic level. The banks generally try to go ahead of other banks in terms of attracting number of customers to their countries. For this they are trying to offer some unique services as per the unique requirements of the unique important customers.

COMPARITIVE STATEMENT OF HOME LOAN

PARTICULARSHDFCICICIPNBSBI

ROI(FIXED)14%1 -5 Yrs. -16%5 - 10 Yrs. - 16 % 10 -15 Yrs. - 16%15 -20Yrs-13.75%

Up to 5yrs-9.25% (up to 20 lakh) &10% (above 20 lakh) Year 1 - 8% Year 2 & 3 - 9%

5 to 10yrs-10% (up to 20 lakh) & 10.25% (above 20 lakh )

10 to 20 yrs-10.50% (up to 20 lakh) & 10.75% (above 20 lakh)

ROI(FLOATING)Up to 30lakh-8.75%30 lakh-50lakh-9%Above50lakh-9.25%1 - 5 Yrs.- 16 % 5 - 10 Yrs.- 11.25 % 10 - 15 Yrs.-16 % 15 - 20 Yrs- 16 % Up to 5yrs-8.75% (up to 20 lakh) &9.50% (above 20 lakh)

Year 4 onwards -

up to 50 lakh-9.25% over 50 lakhs-9.75%

5 to10yrs-9% (up to 20 lakh) & 9.50%(above 20 lakh )

10 to20yrs-9.25% (up to 20 lakh) & 9.75% (above 20 lakh)

PROCESSING FEE0.5%0.5%0.5%0.5%

PENALTY2%2%2%2%

TENURE25 years15 years20 years25 years

MINIMUM AGE21252525

MAXIMUM AGE60555555

COMPARISON OF MAJOR PLAYERS

The markets for home loans have been sizzling in India. The spurt in growth in recent years and the prospect of continued buoyancy in demand have attracted many players to the industry which till a couple of years back had two major players- HDFC and LIC Housing Finance. The result is cut-throat competition, which has benefited the loan seekers. The home loan market has grown at a compounded rate of over 40% over the last four years. And from what industry experts believe that there is a little chance that there will be any significant decline in the growth rates going forward. So what have been the key factors in triggering of this high growth period?There are several reasons for the same on the demand side:-

Faster rise income as compared to property prices, thus making housing more affordable. Decline interest rates, which have greatly reduced the cost of borrowing (both on interest and capital).

Then there are factors on the supply side too which have supported this growth:-

More competition in the housing finance sector resulted in companies charging lower interest rates, sometimes even at the cost of spread (i.e. profit margin) The fee for getting the home loan has reduced dramatically over the last couple of years. From over 2% of the loan amount to as long as 0.25% (some companies are known to wave of the fee entirely). Housing Finance Companies have introduced several new products to meet the needs of wide variety of customers. One such scheme, the Step up Loan, where EMIs increases as the income of the individual increases has been a big hit with the individuals just starting off with their careers. One other factor is increasing collaboration between Housing Finance Companies and builders. Such partnership minimizes the service and funding related issues significantly thus making it easier to buy property.

One innovation in the housing finance sector has been the introduction of floating rate home loan simply put the cost of such home loan or the interest rate not fixed during the tenure of the loan. Instead interest rate is benchmarked against some index/ indicator. So as the benchmark rate moves up or down, the cost of your loan too changes, at some predetermined frequency (usually once a quarter).

Ideally loan seekers should opt for a floating rate home loan when it is expected that the interest rate will decline going forward. Fixed rate loans should be preferred when the interest rates are expected to rise.

But is the choice that simple? In todays environment when there is a lot of talk about rising interest rate, should investor shun floating rate home loan. Altogether is there still some merit in this instrument? In the last one year, there was a trend of floating rate home loans being more popular as compared to the fixed rate loan. As of now, this trend is continuing says Mr. Suresh Menon , GM (Mumbai region), HDFC Limited.

There are three important issues which one needs to consider before opting for one type of a loan over the other:- First, an important determinant of what you go in for should be the long term expectation of interest rate. For example if you (or the experts) expects the rates to rise for the next one year, but then decline gradually over the next several years a floating rate product may be preferable. The other option for going in for a fixed rate product and then switching at the end of the year will entail costs (there could be penalty of 1%-2% of the outstanding loan amount) and may not make financial sense. Moreover floating rate home loans do not change the rate of interest every quarter (even though they review the rate every quarter). Mr. Menon points out The attraction of a floating rate home loan is that it does not attract a part prepayment charge. This could appeal to individuals who get lump sum bonuses which they can use to reduce their loan exposure. Second, the issue whether fixed rate home loan are actually fixed rate. When considering a fixed rate home loan over floating rate of home loan a strong selling point is that if interest rate were to rise dramatically you will be protected. Apparently the reality is somewhat different. It seems that companies that have given out fixed rate home loans can revise their rates upwards in exceptional circumstances (significant rise in interest rate for one) so if you think interest rate will remain rage bound over the near term and decline over the long term, you are still better off with the floating rate product. Third, a fixed rate loan is generally priced higher as compared to the floating rate product. This holds true in the current environment where the fixed rate loan is at a higher interest rate as compared to the floating rate loan. The difference is currently about 0.25% to 21%. So if you expect that interest rate are likely to move up, but only to the extent of this differential, then you should ideally be in different between the two types of loan. The deciding factors then should be when you think the rates will increase and also the long term expectations of interest rates.

As always there is no one answer to whether you should go in for floating or a fixed rate home loan. If you are a person with very little appetite for risk or negative surprises, opt for fixed rate home loan. But in case you can take on some risk a floating rate home loan is worth a look.

Five steps to take a right loan:-

1) Gather data on interest rate. Get interest rate information from more than one source and get the same information from each so you can compare the offers.2) Get information on fees. Find out about processing fees, administration charges and other costs that may be involved in taking the home loan. A written statement of all the fees from the housing finance companies will ensure that there will be no surprises later on. Use the lowest amount of fees to negotiate with the other lenders.3) Get pre-approval letter. This gives you substantial leverage as you are then seen as serious buyer by the seller of the property. Also, having the letter in your hand will set a limit to the amount of money you can commit to the property. This will help in identifying the right property.4) Bargain for a lower rate of interest. Housing finance will reduce their rack rates for customers with the good credit record. A bargain deal will easily fixed a home loan at significantly lower rates (at times you can get a discount of as high as 0.50 percent). Here again get a confirmation of the rate (and for how long it will remain fixed) via a letter.

5) Watch out for a predatory lending. Dont include false information on your home loan application to get quick approval. Also do not borrow more money than you need or can afford.

A floating interest rate allows customer to take advantage of interest rate movements. They get immunity from adverse movements and read the benefits of any fall in interest rate but a floating rate loan makes sense only when interest rate are high so that they can take advantage of possible fall. But predicting interest rate movement could confound even seasoned market watchers.

If they are looking for a home loan, be prepared to cough up a pretty sum as down payment. The RBI, in a recent meeting with the bankers cautioned banks against lending 100% of the property value. That is because of increasing competition in home loan some banks have been funding even 110% of the agreement value. This means your loan not only pay for the property, it helps with the stamp duty and registration charges and even furnishing. Its being sweet deal so for, as borrower not only need have no access to other funds, they also get tax breaks.

The RBIs position is that lending such sums will remain additional risk for the bank. In case of default, the bank may not have sufficient collateral security to recover dues and may have to write off the additional borrowings. However, the bankers do not seen unduly worried. Non performing assets in the housing segment are quite low below 1% and that, say bankers, is due to the higher asset quality.

SWOT ANALYSIS OF HOUSING FINANCE INDUSTRY

STRENGTHS

1) The industry has been witnessing very fast growth rate, which is 6% growth in the first 2) Quarter of 2002-2003 as against 3-5% growth recorded in the first quarter of 2001-20023) The market faces a high demand curve, thoroughly mismatched by a low supply curve4) Investment is based in assets that are securities & those that have historically appreciate rapidly.5) Tax benefit & other facilities provided on loan repayments.

WEEKNESSES1) The foreclosure rules of court of law such as provision regarding the ownership of not more than one house (in Delhi) binds the industry.2) The healthy of an HFC depend upon its ability to mob up low cost funds. 3) AN HFC is unable to tap the rural market due to lack of proper retrieval procedures so whilst 4) The rural market offers a higher rate of return; it has a higher risk & default rate. 5) Many legal impendent exist, deferring purchase of certain types of property beyond a 6) Certain extent thereby negatively impacting weak mortgage laws, resulting in an increase in risk compo ending this.

OPPORTUNITIES

1) The housing industry faces a severe shortage of houses. The total demand for houses is Expected to touch around 19.40 million units by the year 2003 of these 12.8 million2) Dwelling units (65-98%) would be in rural areas & 6.6 millions dwelling units (34.02%) in urban areas.3) While the loan facility is backed by the security of property this sector represent a low margin But on the low margin but on the same line low risk segment. The address this 4) Market the ones lies on the HFCS to device bold & innovative alternatives like mortgage Based securities use of method such as door to door collection of installments assessing the Creditworthiness of the prospective client and providing for group securities.5) The roles of NHB in refinancing & providing regulation of housing finance system.6) The governments initiatives to promote the sector & its contribution in uplifting the sector.

THREATSThe industry faces increased competition as more & more foreign backs & Housing Finance Companies are providing loan facility.SWOT ANALYSIS OF HDFC HOME FINANACE

STRENGTH

1) Save substantial interest.2) Prepay whenever the customer.3) Reduce their loan outstanding.4) Access the surplus finds anytime.5) Use surplus funds to invest when the right opportunities arises.

WEAKNESS

Product is very good but it is mainly suitable for higher income group & is not suitable for the Middle income group

OPPORTUNITIES

There is ample scope for financing flats & apartments for the salaried class in the higher income Group.

THREATS

1) Nationalized banks like SBI, Union Bank, PNB.2) Private Banks likes HDFC & standard chartered & Citi Bank with its home credit scheme.

ICICI HOME FINANACE COMPANY LTD

Consumer friendly housing finance company

HISTORY

ICICI home finance company ltd was incorporated on May 28, 1999 as 100% subsidiary of ICICI Personal Financial Services Limited (ICICI PFS). ICICI finance company Ltd was set up with objective of providing long term housing loan to individual and corporate. The company was registered on March 302000 with National Housing Act, 1987 in terms of Housing Financing Companies (NHB) direction, 1989 with effect from May 3, 2002, ICICI home finance has become a 100% subsidiary of ICICI bank Ltd.

OVERVIEW

ICICI home loans are at present available to customer in 150 cities/towns across the country. Loans are offered for the purchase of new homes. Purchase of resale homes and home improvement. Besides the companies also offers loans for commercial property and loans against existing property. The loans are offers foe tenors up to 30 years. The company has also introduced several customers friendly services such as door step services, know your loan on phone facility and ICICI home search free property brokerage services. ICICI Personal Financial Services Limited (ICICI PFS) formerly ICICI credit was one of the first four companies to obtain registration as non banking financial banking companies(NFBc) from the reserve bank of India (RBI)on sep 10, 1997 under the new section 45 I A of the RBI act ,1939.

During the year 1998-1999, there was a significant shift in the companys operations from leasing and hire purchase to distribution and servicing the all the retail products for ICICI, including two auto loans, consumer durable finance & another financial products. The company has become a critical part of ICICIs retail strategy aims at offering a comprehensive range of products &services to retail customers. In view of this reorientation of the business, the name of the company was changed from ICICI Corporation Limited to (ICICI PFS) effective march 22, 1999.

ICICI commenced its custodial services business in 1992 & played a pioneering role in the business when it accepted the custodian role for the first ever GDR issue by an Indian corporate (reliance industry Ltd). ICICI has a major market share in the segment act as custodian of 41 ADR/GDR issues & in the process, has established the relationship will all the major overseas institutional investors including foreign institutional investors (FIIs) & as on the June 30,1999, the value of asset held in our custody exceeded us 2 billion. At present, ICICI offers a full range of custodial services for primary and secondary market operation pertaining to debt, equity, money market instruments GDR/EURO issues conversion & GDR arbitrage to:1) Overseas institutional investors like a) FIIS b) OCBS c) OFFSHORE FUNDS d) VENTURE FUNDS 2) Overseas government agencies.3) Institutional looking for proprietary investment.4) Mutual funds5) Private investment companies6) Large corporate7) High net worth individual

As a value added services ICICI custodial services division assist the client in preparation, submission & follow up for various applications by FIIS/OCB with SEBI/RBI

APPLICATION PROCESS OF YOUR HOME LOAN

Yoursearchforthe perfecthomeloanendshereat ICICI Bank Home Loans, even before your have found the perfect property.

The moment you decide to buy a home, you can put in your application for a home loan. Yes, you can apply for a home loan even before you have selected the property.

The property need not even be in the same city where you are residing. The only condition being that ICICI Bank has Home Loans operations in both the cities.

Should there be a change in your financial status or plans, you can withdraw your sanction within 6 months of approval of your home loan.

However, we are always ready to assist our customers in the event of legitimate problems. And, we might reconsider this if we find that there are satisfactory reasons for the delay.And, neither would we charge you extra for this delay.

If it is refinancing you are interested in, it is possible within 6 months from the date of purchase of property.

PERSONAL BANKING

At ICICI bank they are committed to making banking a pleasure. This commitment is manifested in services they offer a wide range of account, investment scheme & facilities. Each services offer their customer security, flexibility of operations & maximum returns.The various services provided under this is as follow:1) Maximum cash-saving account2) Quantum fixed deposits3) Quantum optima value added saving account4) Money plus-current act5) ATM6) Treasure chest cocker facility7) Power pay roll8) Retail treasury instruments

CORPORATE BANKING

MOBILE COMMERSE ICICI bank now brings back account & ICICI credit card to customers fingertips .with mobile commerce customer can perform a wide range of query based transaction from their orange tm (Mumbai) & Airtel (DELHI) mobile phone , without even making a call. 1) Access multiple accounts2) Balance inquiry to the linked account3) Cheque book request4) Mini statement listing of last three transactions5) Request for account statements (by mail or fax) ICICI

1) Attractive IR2) Door step service from enquiry stage till the final disbursement.3) No guarantor required.4) Can transfer your existing high interest rate loan.5) Special 100% funding for special properties.

FACTORS AFFECTING YOUR LOAN AMOUNT

With ICICI Bank Home Loans, you can get a home loan suited to your needs. The home loan amount depends on your repayment capability and is restricted to a maximum of 80% of the cost of the property or the cost of construction as applicable. A number of factors are taken into account when assessing your repayment capacity. Repayment capacity takes into consideration factors such as income, age, qualifications, number of dependants, spouse's income, assets, liabilities, stability, continuity of occupation and savings history. However, there are ways by which you can enhance your eligibility.

If your spouse is earning, put him/her as a co-applicant. The additional income shall be included to enhance your loan amount. In case of any co-owners they must necessarily be co-applicants.

The final amount to be sanctioned will depend on your repayment capacity. However, what you ultimately are entitled to will have to conform within the limits fixed for each loan.

Also, when the company looks at the total cost, registration charges, transfer charges and stamp duty costs are included.

Documents required for Home Loan Sanction

ICICI Bank Home Loans, Indias leading Home Loans Provider, offers attractive interest rates and unbeatable benefits to ensure that you get the best deal. Keeping your convenience in consideration, we ask you for minimal mandatory documents for the sanctioning of your home loan, to keep the process totally hassle-free.

We require the following documents to sanction your home loan:

Sanction Documents Completed application form

Photograph

Fee Cheque

Photo Identity Proof

Age Proof

Signature Verification Proof

Residence Address Proof

Document for the Salaried

Last 3 months Salary Slip

Form 16

Bank Statement for the last 6 months from Salary Account

Repayment Track record of existing loans / Loan closure letter

Document for the Self-employed

Income Tax Return / Computation of Total Income / Auditors Report / Balance Sheet / Profit & Loss Account certified by Chartered Accountant for last 2 years (3 years for Home Equity) (both for business and personal of partners/directors)

Bank statement for the last 6 months from operating account

Repayment Track record of existing loans / Loan closure letter

Board Resolution in case of a company

Proof of existence

Office Address Proof

Photo Identity Proof, Residence Address Proof, Signature Verification Statement for all the main partners / directors.

HOME LOAN 1) Customer must be at 21 year of age when the loan is sanctioned. 2) The loan must terminate before or when you twin 65 year of age or before retirement, Whichever is earlier.3) Customer must be employed or self employed with regular source of income

LOAN AMOUNT

A number of factors are taken into account when assessing repayment capacity. Customer income, age, number of dependents, qualification, asset &liabilities, stability and continuity of customer employment. Business is one of them. However there are ways by which you can enhance your eligibility. If the customer spouse is earning put he/she as a co-applicant. the additional income shall be included to enhance the loan amount. Incidentally, if there are any co owners they must necessarily be co-applicant customer fiances income can also be considered sanctioning the loan on your combined Income .the disbursement of the loan, however will be done only after the submit proof of Marriage. Providing additional security like bonds, fixed deposits & LIC policies may also help to enhance Eligibility. While there is no need for guarantor, it could be that having one might enhance your credibility with us. If so, our loan officer would provide customer with positive necessary details. The final act to be sanctioned will depend on your repayment capacity. However, what customers ultimately are entitled to will have to conform within the limits fixed for each loan. Also when the company looks at the total cost, registration charges, stamp duty, transfer charges are also included.

HOMELOAN

We at ICICI bank understand the value of owing your house. Our affordable home loans can make all the difference to their dreams of owing home.

FIND THE RIGHT HOME

Provide facility for search of free online property. A one stop shop for all their Real Estate needs.

WHAT YOU GET

0% brokerage on first sale properties access the entire market under our roof site visits to the properties short listed by you. Help in negotiating the best price. Help the legal documentation.LISTINGS BELOW ARE THE STEP INVOLVED IN AVAILING OF A HOMELOAN

A person applies for a home loan The executive meets the applicant & briefs him the entire loan process, requirements & the various options available. The applicant chooses a housing finance company (HFC) & handover the income Document to the executive are the income documents are headed over to the HFC for eligibility & approval. The HFC verifies the documents & checks the repaying capacity, saving habits, tenure of services etc. of the applicant & approves the loan amount. After approval an offer letter is given to the applicant by the HFC, along with list of original title documents that have to hand over to the HFC. The applicant gives the original property title document to the HFC The HFC scrutinizes the legal & the technical aspects of the original title document. If the HFC is satisfy as to the legal & technical aspect of the document then the applicant is called to sign the loan agreement The loan disbursement schedule is decided by the HFC according to the stage of construction (If property under construction) or a onetime payment is made if property is ready for Possession. The applicant gets possession of the property depending upon the level of completion of the property. The applicant can start paying the EMIs.

DISBURSEMENT

Customer loan will be disbursed after you identify & select the property or the home that customer are purchasing and on their submission of the requisite legal documents.While the customer may be under impression that the list of documents asked for it is rather extensive. Each and every single document asked for will be verified & check to ensure their safety. This may take some time but the banks want to ensure a clear title and will complete all the legal & technical verification to ensure that they have full right to their home.The 230 a clearance of the sellers or 371 clearance from the appropriate income tax authorities (if applicable) is also needed on satisfactory completion of above, on registration of conveyance deed and on the investment of your own contribution, the loan amount (as warranted by the stage of construction) will be disbursed by ICICI.The disbursement will be in favor of the builder/seller.

At ICICI Bank Home Loans, we disburse the loan amount after you identify and select the property or home that you are purchasing and submit the requisite legal documents. While you may be under the impression that the list of documents asked for is rather extensive, please note that it is for your own good. Each and every single document asked for will be verified and checked to ensure your safety.This may take some time but we want to ensure a clear title and will complete all the legal and technical verifications to ensure that you have full rights to your home. Your loan will be disbursed after you identify and select the property or home that you are purchasing and on your submission of the requisite legal documents.

The 230 A Clearance of the seller and / or 37I clearance from the appropriate income tax authorities (if applicable) is also needed. On satisfactory completion of the above, on registration of the conveyance deed and on the investment of your own contribution, the loan amount (as warranted by the stage of construction) will be disbursed by ICICI Bank.

Disbursement Documents

Property documents (as per P&D for respective states and as asked by empanelled lawyers for individual cases)

Facility Agreement

Disbursal Request Form

Cheque Submission Form for Pre EMI and EMI cheques

ECS or Auto Debit for ICICI Bank account holders or Post Dated Cheques for EMI / Pre EMI

Personal Guarantors Documents (PG Form, Photograph, Identity Proof, Address Proof, Signature Verification and Income documents, if applicable)

In case of property is owned by a company Memorandum of Entry Form 8 NOC

AMOUNT

This largely depend on a no. of facts like ones age ,profession, salary, the city one reside is among other such factors. it varies between 2.1lakh to 1crore depending on the lender- as the rule of the thumb, depending on HFC one have to cough up 15% - 20% of the loan amount as the down payment. For smaller amount, this may not be much. But for figure remaining into lakh this could make loads of difference. For e.g. an apartment of costing Rs 10 lakh may get 85% financing, so one will have to arrange for remaining Rs 15 lakh. If one takes this into amount the additional thousands will definitely put a strain on ones finances.

TENURE

Generally the maximum tenure of home loans is 15 years, with a few lenders offering tenure of 20 years or more. ICICI offers 15 year loan. The longer the tenure, the more one pay in total interest but ones monthly payment will be less. So depending ones earning potential & bank balance one can choose an appropriate tenure. An important requirement of most of the banks/ HFCs is that one pays up the entire loan before one retires. One can always prepay ones entire loan amount before it is due. There is a trend to do away with the pre-payment penalty being imposed by some lenders. So its best one checks on this as well.

INTEREST RATE

Without doubt the most important parameter to factor into ones calculations. The interest rates may vary from institution to institution. Repayment is in the form of EMIs (equated monthly installment). The longer the tenure, the more one pays in interest, but ones monthly payment will be less. The interest rate of ICICI is

Tenure Interest Type Interest Rate

.15 -20 Fixed 13.75 %

10 -15 Fixed 16 %

5 - 10 Fixed 16 %

1 - 5 Fixed 16 %

1 - 5 Floating 16 %

5 - 10 Floating 11.25 %

10 - 15 Floating 16 %

15 - 20 Floating 16 %

REFINANCE

This is concept that is yet to catch on in the home loan market but is bound to be a major service in the months to come. Under this facility, one can take a new loan from another bank/HFC to pay back another loan before its natural tenure. It gives one the opportunity of prepaying ones high cost debt and get a lower cost one. In todays falling interest rate scenario one should use this vehicle to lower ones debt payment as much as possible. The lender facilitates the shift by paying the outstanding and transferring the asset to other portfolio.

MISCELLANEOUS CHARGES

The interest rates and EMIs are not only the cost factor. Never underestimate how much the processing fee and administration fees amount to. A 0.5% administration fees and 0.5% processing fee on say, a Rs.500000 loan would be Rs.5000. other timesit could be just one fee (either administration or processing but could yet work out to be much more if it is considerably higher at, say, 2.5% or 3%. The various other fees, which one is required to pay along with the margin amount are:

INTEREST TAX:

This is tax payable on the interest paid on a home loan and not the principal. This is sometimes included in the interest rate of the loan, or may be charged separately as interest tax.

PROCESSING CHARGE

It is the fee payable to the lender on applying for a loan. It is either a fixed amount not linked to the loan or may be a percent of the loan amunt. The loan amount received by you can be less than processing fee.

PREPAYMENT PENALTIES

When the loan is paid back before the nd of the agreed duration a penality is charged by some banks or companies, which is usually between 1% and 2% of the amount being prepaid.

OTHERS

It is quite possible that some lends may levy a documentation or consultant charge.

ICICI BANK ANNOUNCES ITS BASE RATE, VALID FROM JULY 1, 2010

ICICI Bank has announced a shift in the existing benchmark rate from Floating Reference Rate (FRR)/ I-BAR the Base Rate (I-Base). The same will be effective for all its mortgage products from July 1, 2010. The ICICI Bank Base Rate (I-Base) has been fixed at 7.50%. This is the minimum rate that ICICI Bank will charge to its new customers.

BENEFITS Some of our key benefits are: Guidance through out the process Home loan amounts suited to your needs Home Loan tenure upto 20 years Simplified documentation Doorstep delivery of home loan papers Sanction approval without having selected a property. Free Personal Accident Insurance (Terms & Conditions) Insurance options for your home loan at attractive premium

PUNJAB NATIONAL BANK

INTRODUCTION

PNB has over 4500 branches and offices bringing the Punjab National Bank to your doorstep. Around 2400 offices come under the network of Centralized Banking Solution or CBS. A need for centralized banking system prompted PNB to go computerized and what followed was the establishment of CBS in Punjab National Bank branches in all the leading cities like Delhi, Pune, Chennai, Mumbai, Ahmedabad, Chandigarh, Gurgaon, Hyderabad, Jalandhar, Kolkata, Ludhiana, Nodal and Bangalore. Internet Banking Services are provided to all customers in the CBS branches. A branch and ATM locator is also available on the official website of Punjab National Bank. For an overview of the annual report or the bank profile, the site can be resourceful. The website also provides info on the careers and recruitments at PNB and the exam results. The careers at nationalized banks like PNB are the most sought after one and candidates are selected on the basis of their exam result. PNB topped the Best Paying Commercial Bank category with an overall rating of 87.45% as evaluated by the SSS Retirement, Death & Funeral Benefits Program.

PROFILE OF PNB

The profile of the PNB shows superior banking services in corporate, personal and international banking, industrial and agricultural finance and finance of trade. Punjab National Bank boasts of a varied clientele consisting of small and medium industrial units, exporters, multi-national companies, Indian conglomerates and NRI. The Bank is changing outdated front and back end processes to modern customer friendly processes to help improve the total customer experience. With about 8500 of its own 10000 branches and another 5100 branches of its Associate Banks already networked, today it offers the largest banking network to the Indian customer. The Bank is also in the process of providing complete payment solution to its clientele with its over 8500 ATMs, and other electronic channels such as Internet banking, debit cards, mobile banking, etc.The objectives of the Company are in line with objectives laid down by RBI for the Primary Dealers:

Strengthen the infrastructure in the government securities market in order to make it vibrant, liquid and broad based. Ensure the development of underwriting and market making capabilities for Government Securities Improve secondary market trading system, which would contribute to price discovery, enhance liquidity and turnover and encourage voluntary holding of Government securities amongst a wider investor base Become an effective conduit for conducting open market operations.

PNB HISTORY

Punjab National Bank of India was established by Lala Lajpat Rai in the pre-independence India in 1895 in Punjab, with Lahore as its head office. Today it is the second largest public sector bank in India. It was nationalized in 1969 along with 13 other major commercial banks. The privatization started in 1989 when 30 per cent of its shares were offered to the public and it was listed on the stock exchange.In 1992, PNB became the first Philippine bank to reach P100 billion in assets. Later that year, privatization continued with a second public offering of its shares. In August 2005, PNB was fully privatized. The joint sale by the Philippine government and the Lucio Tan Group of the 67% stake in PNB was completed within the third quarter of 2005. The Lucio Tan Group exercised its right to match the P 43.77 per share bid offered by a competitor and purchased the shares owned by the government. The completion of sale is expected to speed up the development of PNBs franchise and operational competitiveness.

Today, State Bank of India (SBI) has spread its arms around the world and has a network of branches spanning all time zones. SBI's International Banking Group delivers the full range of cross-border finance solutions through its four wings - the Domestic division, the Foreign Offices division, the Foreign Department and the International Services division. PNB RECENT ACHIEVEMENTS AND MILESTONES

Punjab National Bank (PNB), has announced that it has completed 100% core banking implementation at all its 4604 branches and extension counters through the Finacle Universal Banking Solution from Infosys, on Sun infrastructure and the Oracle Database setting a significant milestone for themselves and a new benchmark for the Indian banking industry. Completed in November 2008, 4 months ahead of schedule, the bank implemented industry-leading Finacle core banking solution from Infosys across its operations running a flexible, and scalable database platform from Oracle and innovative servers from Sun Microsystems With an increasingly dynamic business and regulatory environment, PNB sought to not only achieve automation, but also centralize operations, standardize branch processes, achieve high scalability for future business growth, provide flexibility of creating innovative banking products to its lines of business, and at the same time, reduce overall costs. The visionary zeal and the futuristic view of the Banks top management in the year 2007-2008 incubated the idea of introduction of a Centralised Banking solution. The bold and innovative thought culminated into the CBS architecture with Finacle application on Oracle Database and Sun hardware platform with Solaris Operating System. With Finacles agile and future proof technology, the bank today has over 22,500 concurrent users. The solutions scalability has also enabled the banks scalability to be the best in the country with the number of peak transactions at 3.5 million. Finacle core banking platform also provides the bank with exceptional agility for product innovation and improved flexibility of operations. With seamless integration of delivery channels such as ATM and internet banking solutions, PNB is able to provide 24X7 services to customers at a reduced transaction cost. PNBs choice of the Oracle Database has provided the banks IT infrastructure with robustness, management features, security and scalability as well as performance requirements to service 3.5 million transactions and 22500 concurrent users a significant achievement in the Indian banking industry. In addition, the Oracle Database will help PNB take control of its enterprise information, gain better business insight, and quickly and confidently adapt to an increasingly changing competitive environment.20

With secure, highly available and scalable grids of low-cost servers and storage, Oracle customers can tackle the most demanding transaction processing, data warehousing, business intelligence and content management applications. The 100% implementation of Finacle Core Banking Solution shall enable PNB to further reduce operational costs and revenue leakage while improving productivity of branches, introduction of new and innovative products and visibility of business. The anywhere anytime banking facility will enable the bank to offer products for every segment of the customer. PNB long-standing and progressive partnership also highlights Finacles leadership in large scale banking transformation, the solutions future proof technology and powerful capabilities. India is a strategic market for Finacle and we look forward to closely collaborating with Punjab National Bank for their future growth plans.

REGULAR HOUSING FINANCE SCHEME FOR PUBLIC

PNB reaches out to you with fast, friendly and most convenient home loans for:

Construction or purchase of house/ flat. Purchase of house/ flat on First Power of Attorney basis from the original allottee Carrying out repairs/ renovations/ additions/ alterations to existing house/ flat Special Feature- To cover the loan outstanding, life Insurance cover is also available on payment of one time premium which can also be financed by the Bank. PRODUCTS

PNB Apna Ghar Yojana home loans are meant for construction or for acquisition/purchase of house/flats. The minimum loan amount would be Rs.50000 and maximum loan amount depends on the repayment capacity of the borrower. In case of joint application, income of borrowers /co-borrowers is clubbed together for calculation of loan eligibility. The loan repayment is in Equated Monthly Installments (EMI) over a maximum period of 20 years. PNB Ghar Sudhar Yojana home loans are offered for up gradation, renovation or repair of house/flat. It includes among others, internal and external repairs, water proofing, roofing, flooring, electrical, woodwork etc. The loan amount ranges from a minimum of Rs 50,000 to a maximum of Rs. 1000000. Borrower's minimum contribution will be 25% of the estimated cost of repairs/renovations

INDIVIDUAL For construction/purchase of house/flat: - 75% of the cost of construction of house or purchase of house/flat. Cost of car parking up to the maximum extent of 5% of the cost of flat/house can also be included in the cost of the project. For carrying out repairs/ renovations/ additions/ alterations: - 75% of the estimated cost subject to maximum of Rs. 20 lacs.

Loan is available up to Rs. 20 lacs for purchase of Land/ Plot. Loan is available maximum up to Rs. 2 lacs for furnishing

PRODUCT RANGE OF COMPANY/INDUSTRY:

The products and services provided by the PNB are in various fields, such as:

NRI services International banking Corporate banking Agricultural banking International banking

ELIGIBILITY

Age of the applicant must be less than 60 years.Existing home loan borrower can also apply provided their loan account is regular and no IR irregularity persist.

DOCUMENTS NEEDED

1. Proof of identity 2. Proof of income 3. Proof of residence 4. Bank statement or Pass Book where salary or income is credited.5. Education Certificate6. Photos 7. Salary slips & form 168. Income tax return last 3 years along with balance sheets.9. Assets liabilities statements.10. Documents of property.11. Estimate of construction.12. Guarantor

FREEHOLD AND LEASEHOLD PROPERTY

The loan can be granted both for freehold and leasehold property.

In case of leasehold, loan can be granted on the basis of power of attorney basis from original allotee where DDA/PUDA/HUDA permit conversion of leasehold into freehold property otherwise advance is not permitted against plot purchased on Power of Attorney basis.

EXTENT OF LOAN

For construction/purchased of house/flat 75% of the cost of construction or purchase of house/flat. For carrying out repairs/renovation/additions/alternation: - 75% of the estimated cost subject to maximum of Rs. 20 lacs. Loan up to Rs. 20 lacs for purchase of land/plotLoan is available maximum up to Rs. 2 lacs for furnishing

CHARGES

Pre payment charges 2%