Comparative Study of Home Loans With HDFC Ltd. by AVINASH MOREY

A DISSERTATION ON
A COMPARATIVE STUDY OF TWO PLANS OF HOME LOANS OF HOUSING DEVELOPMENT FINANCIAL CORPORATION LTD., WARDHA.
SUBMITTED TO
SANT GADGE BABA AMRAVATI UNIVERSITY, AMRAVATI
In Partial Fulfilment of the Requirement for the Award of the Degree of Master of Business Administration
2008-2009
GUIDED BY Lect. N. Y. KASLIWAL M.Com, P.G.D.B.M., Ph.D. (Regd.) SUBMITTED BY
Mr. AVINASH E. MOREY

MBA [FINANCE], D.B.A.R., S.S.G.M.C.E., SHEGAON HEGAON
D.B.A.R., S.S.G.M.C.E., SHEGAON ,
DEPARTMENT OF BUSINESS ADMINISTRATION AND RESEARCH

SHRI SANT GAJANAN MAHARAJ COLLEGE OF ENGINEERING, SHEGAON-444203 (M.S) SHEGAON (Accredited By N.B.A, New Delhi & ISO 9001:2000) Website: http://www.ssgmce.org
A DISSERTATION ON
A COMPARATIVE STUDY OF TWO PLANS OF HOME LOANS OF HOUSING DEVELOPMENT FINANCIAL CORPORATION LTD., WARDHA.
SUBMITTED TO
SANT GADGE BABA AMRAVATI UNIVERSITY, AMRAVATI
In Partial Fulfilment of the Requirement for the Award of the Degree of Master of Business Administration
2008-2009
GUIDED BY Lect. N. Y. KASLIWAL M.Com, P.G.D.B.M., Ph.D. (Regd.) SUBMITTED BY

MBA [FINANCE], D.B.A.R., S.S.G.M.C.E., SHEGAON
D.B.A.R., S.S.G.M.C.E., SHEGAON
DEPARTMENT OF BUSINESS ADMINISTRATION AND RESEARCH

SHRI SANT GAJANAN MAHARAJ COLLEGE OF ENGINEERING, SHEGAON-444203 (M.S)
(Accredited By N.B.A, New Delhi & ISO 9001:2000) Website: http://www.ssgmce.org
DEDICATED TO
Department Of Business Administration and Research

Shri. Sant Gajanan Maharaj College of Engineering, Shegaon - 444203. Ph. (07265) 252116/252478 Fax 07265-252346 E-Mail: ssgmceng@mah.nic.in ssgmceng@boms.vsnl.net.in
CERTIFICATE
This is to certify that AVINASH E. MOREY is the student of MBA final year (FINANCE) of the Department Of Business Administration And Research, S.S.G.M.C.E, Shegaon. He has carried out the research work entitled A COMPARATIVE STUDY OF TWO PLANS OF HOME LOANS OF HOUSING DEVELOPMENT FINANCIAL CORPORATION LTD., WARDHA during the whole academic session 2008-2009. This research work has been carried out under my supervision and is of sufficiently high standard to warrant its presentation for the examination leading to the Degree of Master of Business Administration of Sant Gadge Baba Amravati University, Amravati. PROJECT GUIDE
(Lect. N.Y. Kasliwal) D.B.A.R., S.S.G.M.C.E., SHEGAON (Dr. V. K. Deshpande) H.O.D., D.B.A.R., S.S.G.M.C.E., Shegaon (Dr. V.N. Gohokar) Principal, S.S.G.M.C.E., Shegaon
DECLARATION
I hereby declare that this project entitled A COMPARATIVE STUDY OF TWO PLANS OF HOME LOANS OF HOUSING DEVELOPMENT FINANCIAL CORPORATION LTD., WARDHA is the result of my original project work and the same has not been previously submitted to any examination of this university or any other university. That dissertation shall be liable to be rejected and / or cancelled if found otherwise.
DATE: PLACE: SHEGAON
Mr. AVINASH E. MOREY MBA II YEAR (FINANCE)
ACKNOWLEDGEMENT
It is my pleasure to place on record my sincere gratitude towards my guide Lect. N. Y. KASLIWAL, Department of Business Administration and Research, S.S.G.M.C.E, Shegaon, who spent his precious time providing continuous ideas and expert guidance to my project work. It was his direction and encouragement at every moment and step that motivated me to steer the research work confidently and successfully. I am also thankful to our Venerable Principal, DR. V. N. GOHOKAR, and respected H.O.D. DR. V. K. DESHPANDE, D.B.A.R., S.S.G.M.C.E., SHEGAON whose encouragement, moral support and provide the valuable guidance, which has been a source of inspiration to me. I am indebted to my respected parents because of whose blessing I have been able to carry out this work successfully. I am also thankful to my dearest friends who directly or indirectly help me lot. Last but not the Least, I would like to pray my divine source of inspiration SHRI SANT GAJANAN MAHARAJ whose blessing always back me.

MBA II YEAR (FINANCE)
INDEX
LIST OF TABLES & CHARTS
CHAPTER
I
TITLE INTRODUCTION - 1.1 CONCEPT OF HOME LOANS - 1.2 NEED FOR HOME LOAN - 1.3 HOME LOAN DOCUMENTATION - 1.4 THE ELIGIBILITY CRITERIA
PAGE
1 to 10
II
ORGANISATIONAL PROFILE
- 2.1 HISTORY OF HDFC LTD. - 2.2 ADVANTAGES OF HDFC HOME LOAN - 2.3 OBJECTIVES AND BACKROUND - 2.4 ORGANISATION AND MANAGEMENT
11 to 20
- 2.5 FEATURES AND BENEFITS - 2.6 MILESTONE OF HDFC IN 10 YEARS - 2.7 HDFC FUTURE
III
RESEARCH METHODOLOGY
-3.1 DEFINITIONS -3.2 OBJECTIVES OF THE STUDY -3.3 HYPOTHESIS -3.4 RESEARCH PROCESS
21 to 28
IV
HOME LOAN SCHEMES

-4.1 HOME LOAN -4.2 HOME IMPROVEMENT LOAN - 4.3 HOME EXTENSION LOAN -4.4 SHORT TERM BRIDGING LOAN -4.5 LAND PURCHASE LOAN -4.6 LOANS TO PROFESSIONALS FOR NON RESIDENTIAL PREMISES LOAN -4.7 HOME EQUITY LOAN
29 to 42
DATA ANALYSIS AND INTERPRETATION CONCLUSSIONS AND SUGGESTIONS BIBLIOGRAPHY APPENDIX
43 67 72 73
VI VII VIII
LIST OF TABLES
TABLE NO.
T 5.1 T 5.2 T 5.3 T 5.4 T 5.5 T 5.6 T 5.7 T 5.8 T 5.9 T 5.10
TABLE NAME
Age wise profile of the respondents Gender wise classification of the respondents Occupation wise profile of the respondents Income wise profile of the respondents Type of loan wise classification of respondents. Loan amount applied by the respondents Sanctioned loan wise profile of the respondents Interest rate wise classification of the respondents Tenure wise profile of the respondents Satisfaction derived by respondents regarding documentation procedure Satisfaction derived by the respondents regarding services. Ranking derived by the respondents to bank. Factor wise classification of the respondents. Age wise comparison between home purchase and home extension loan.
PAGE NO.
43 44 45 46 47 48 49 50 51
52
T 5.11 T 5.12 T 5.13
53 54 55
T 5.14
56
T 5.15 T 5.16
Gender wise comparison between home purchase and home extension loan respondents.
57
Occupation wise comparison between home purchase and home extension loan respondents. Income wise comparison of the respondents between home purchase and home extension loan. Loan amount wise comparison between home purchase and home extension loan respondents. Sanctioned loan wise comparison between home purchase and home extension loan respondents. Interest rate wise comparison of home purchase and home extension loan respondents Tenure wise comparison of home purchase and home extension loan respondents. Comparison between home purchase and home extension loan regarding satisfaction derived by respondents about Documentation procedure Comparison between home purchase and home extension loan regarding satisfaction derived by respondents about services. Comparison between home purchase and home extension loan regarding ranking given by the respondents to the bank.
58
T 5.17
59
T 5.18
60
T 5.19
61
T 5.20
62
T 5.21
63
T 5.22
64
T 5.23
65
T 5.24
66
LIST OF GRAPHS
GRAPH NO.
G 5.1 G 5.2 G 5.3 G 5.4 G 5.5 G 5.6 G 5.7 G 5.8 G 5.9 G 5.10 G 5.11 G 5.12 G 5.13
GRAPH NAME
Age wise profile of the respondents Gender wise classification of the respondents Occupation wise profile of the respondents Income wise profile of the respondents Type of loan wise classification of respondents. Loan amount applied by the respondents Sanctioned loan wise profile of the respondents Interest rate wise classification of the respondents Tenure wise profile of the respondents Satisfaction derived by respondents regarding documentation procedure Satisfaction derived by the respondents regarding services. Ranking derived by the respondents to bank. Factor wise classification of the respondents. Age wise comparison between home purchase and home extension loan. Gender wise comparison between home purchase and
PAGE NO.
43 44 45 46 47 48 49 50 51
52 53 54 55
G 5.14
56
G 5.15
home extension loan respondents.
57
Occupation wise comparison between home purchase and G 5.16 home extension loan respondents. Income wise comparison of the respondents between G 5.17 G 5.18 home purchase and home extension loan. Loan amount wise comparison between home purchase and home extension loan respondents. Sanctioned loan wise comparison between home purchase G 5.19 and home extension loan respondents. Interest rate wise comparison of home purchase and G 5.20 home extension loan respondents Tenure wise comparison of home purchase and home G 5.21 extension loan respondents. Comparison between home purchase and home extension loan regarding satisfaction derived by respondents about G 5.22 Documentation procedure Comparison between home purchase and home extension loan regarding satisfaction derived by respondents about G 5.23 services. Comparison between home purchase and home extension loan regarding ranking given by the respondents to the G 5.24 bank.
66 65 64 63 62 61 59 60 58
CHAPTER 1
INTRODUCTION
A COMPARATIVE STUDY OF TWO PLANS OF HOME LOANS OF HOUSING DEVELOPMENT FINANCIAL CORPORATION LTD. WARDHA
CHAPTER 1
INTRODUCTION
Home finance can also be termed as home loans assistance for buying a home. It is evident that ever past few years the home loans market in India has grown at a rapid rate of over 40%. The most important sources offering the home finance are housing finance companies, commercial banks, cooperative banks and other non banking financial companies. As per the reports, there are about twenty National housing bank registered Housing Financial Corporations in the country offering home loans. Number of housing finance companies have cropped up and are trying to attract consumers by differentiating themselves through various schemes. People are flooded with so many home loan schemes from number of banks and housing financial companies, but it important for home seeker to choose the right HFC and the right package. To decide on this one should be well imparted about the process of getting the home loan, benefits and hassles in taking the home finance.
1 D.B.A.R., S.S.G.M.C.E., Shegaon
First step towards taking home loan is to choose the right HFC. The factors that should be considered while approaching an HFC are the lower interest rate, lower documentation requirements, ability to meet the individual needs of the customers, shorter time span for processing loan applications and the customer service. After choosing the right type of loan based upon the requirements of the customer while choosing a loan the first thing to look at the requirement of the loan seeker. Housing loans are getting more and more popular. The simple reason is being that besides giving a person the self assurance of owing a house, it is one of few assets that does not depreciate in value so quickly. Central government as well as the Reserve Bank of India also realize the importance of promoting the sector, therefore budgets give tax sops to potential house buyers and credit policies cut interest rates so that it becomes affordable for an increasing number of people to purchase their dream home.
1.1 Concepts of Home Loans

Home Loans In India For many millions of Indians, the single greatest achievement in life was to own a home, and thanks to a range of banking services now available, home loans are a simple affair now. In fact loans are now sold as a product and the applicant is treated as the customer. Gone are the days when ordinary folk depended on a lifetime of savings and resorted to the local moneylender to build or buy house. Home loans make it possible to move into your own home, almost as soon as you can afford the down-payment and keep paying for it while you also live in it. But the home loan in case of a repeated default. The term of the loan may range from one year to thirty years, with varying interest Rates. The longer the term the higher the interest rate charged, usually. However, having
decided on a longer term, a pre-payment of the loan also leads to pre-payment penalty- which usually ranges from one to two percent. For instance most home loan applicants have to be between twenty-one and fifty-eight years of age, or at least the guarantor has to be. There may be age limit extensions of Government employees or self employed people who will not be forced retire at sixty. Applicants for home loans must prove to be credit-worthy before a loan is sanctioned by the bank or the financial institution concerned. For one, they will demand to see proof of income or some proof that the applicant now referred to as a consumer has the resources to repay the loan. The EMI, or th4e monthly installments, will be a certain percentage of your income. Taking a home loan also has tax advantages, which makes it doubly good investment, as compared to other conventional forms of savings. Want a house of your own? Most of us will give an answer in the affirmative to this question Well, since, all of us dream of owning a house of your own which our own little heaven, nice, cozy and away from the world. Our heavenly abode. However, unlike other dreams, this dream can be easily made to come true. This is one dream of yours that can easily be transformed into reality today. The best advantage is that today there are people who are willing to walk that extra mile for you. They want to help you make your dream come true. There are huge number of banks, financial institutions and finance companies actually giving out home loans. The home loans are offered at the best rates and conditions. As there are huge number of people who are ready to give home loans, it is considered to be very good from the consumers point of view. As now there are more options available for him to choose from. Thus, so many people in the same sector induces a healthy competition among everyone thereby making the finance seeker get highly competitive interest rates. Although, the terms and conditions for home loans differ from company to company. Generally, the interest rate charged by the banks, financial institutions. Finance companies and
so on are close hugging to the interest rates that seem to be prevailing in the market. Thus, more or less all of them are similar in number. However, the terms of home loan do differ from one company to another. There are few companies who have a belief in asking the finance seeker to keep their property papers with them, for security reason. This is called keeping collateral securities with the home loan issuer. The bank financial institution or finance company whoever issues the home loan goes through your property paper, finds out their real market value, their intrinsic value. After thoroughly checking your property papers if they feel that they are true and fair in nature and are fit enough to be considered by them as collateral securities, then they do so. While, on the other hand there are also a large number of finance issuers who go about asking the finance seeker to make a lump some deposit the first time, commonly known as down payment. There are different types of home loans offered from banks and HFCs. They are: 1. Home Purchase Loan: This is the loan given for purchasing a home. 2. Home Improvement Loan: This loan is given for implementing repair works and renovations to your home. 3. Home Construction Loan: This loan is granted for the construction of a new home. 4. Home Extension Loan: This loan is offered for expanding an existing home. 5. Home Conversion Loan: It is granted for those who have financed the present home with a Home Loan and intend to purchase another home. This type of loan helps transfer the existing loan to the new home. 6. Land Purchase Loan: It is sanctioned for purchase of land, for both home construction and investment purposes. 7. Bridge Loan: It is granted for people who wish to sell the existing home and purchase another. It helps finance the new home, until a buyer is found for the old home. 8. Balance Transfer Loan: It helps you pay off an existing home loan with higher interest rate, and avail of a loan with a lower interest rate.
1.2 Need for Home Loan

Home loans are available for a number of reasons such as incase of building a new house, or incase if one wants to expand their already existing house or incase if one wants to renovate their house. However, there are certain parameters that are fixed by the company issuing home loan, which has to be abided by while going for home loans. Only a few specific criteria s are covered by home loan. Thus, making sure that your requirement matches those criterias. It is extremely simpler for anyone to apply for home loans. You can go about it in a number of ways such as by asking the finance issuing companys or banks representatives to come to your home to help you in filling in the application form for the home loans, also one can even go the financing companys office and fill in the form there or you can fill the form online too. Online filling up of an application form for home loans hardly take a few minutes. Thus, you simply need to feed in a few of your personal details like security number and driving license number. You may also be asked to furnish your previous credit history. Once you fill in the application form online you just need to submit it. The finance issuing company would then be taking round about fifteen days to actually process your form and revert back to you. You can also apply for as many loans as possible; however, the company giving you home loans would make sure that you have the ability to service their loans properly. They would try various possible ways to ensure that your financial state ia stable and that you are very much in a position to service their loans. You can apply to as may loans as you want. However, it is the banks call to grant you the loan or not. Thus, contrary to popular belief, you can actually take home loan from a bank even if you do not hold an account there. Making sure that you read the documents and the agreement well enough before signing. Make sure that you are aware of all various terms, interest rates and installment dates. Another aspect to consider that there are no hidden charges and that of all fees and charges are mentioned so that there are no surprises later.
These times you can afford to dreams as much as you want to. You can spread your wings wide, as the home loans are there to translate your dream of owning a house into reality.
1.3 Home Loan Documentation

Owning a home is probably one of the most precious and cherished dreams of any person; especially when he or she has to earn his or her living from a fixed quantum of salary. For that you basically have two options either save or invest in a planned way, or take a home loan. Numerous banks nowadays have tailor- made packages to serve you, with lots of promises to disburse your loan. The only precondition is your home loan documentation should be ok. After all the credit appraisal officer is also a salaried person! He has to document the papers in a proper way so that if tomorrow you fail to pay the money, he has got enough piles of paper to save e his back! Jokes apart, home loan documentation is the first and foremost hurdle for a salaried individual in the way of getting a home loan. So here is checklist for every salaried person to comply before the proceeds to any bank of his choice to apply for a home loan. The Banks normally try to assure themselves of three things: a) Income/ Employment proof of the applicant so that he can repay the loan. b) Identity and address proof of the applicant so that he can be easily traceable. c) Authenticity proof of the house property so that the applicant doesnt come after few days seeking a personal loan for litigation with the promoter. Each of the aforesaid issues are dealt in below, listing each individual documents, generally sought after, by both the nationalized and private banks.
A. Income Proof
a. Salary slips for the last three months. b. Appointment letter. c. Salary certificate.
d. Retainer ship agreement, if appointed as a consultant. e. Form 16 issued by the employer in your name. f. Last three years Income Tax Returns duly filed and certified by the Income Tax authorities. g. Similar documents separately for each co-applicant. Please Note: Co-applicants income can be considered for enhancing your loan eligibility or increasing your loan amount. Please ensure that all financial documents of co-applicant(s) are attached with your India Home Loan Application.
B. Employment Proof:
a. Identity card issued by your employer. b. Visiting card.
C. Age Proof:
a. Passport b. Voters ID card c. PAN card d. Ration card e. Employers Identity card f. School leaving certificate g. Birth certificate
D. Residence Proof:
a. Ration card b. Passport c. PAN card d. Rent agreement, if you are staying currently on rent. e. Bank Pass book f. Allotment letter from your company if you are residing in company quarters.
E. Name Change Proof: (If Applicable)

a. A copy of the official gazette. b. A copy of newspaper advertisement publicizing the name change. c. Marriage certificate. d.
F. Investment Proof: (If Applicable)

a. Bank statement for the last six months of all operating and salary accounts. b. Banks statements for the last six months of all current accounts, if self- employed. c. Any other photocopies of investments held, if required by the bank.
G. Property Title Proof:

a. Original sale agreement with builder or developer duly registered, Registration receipt. b. Tripartite agreement from builder or developer. c. Land documents indicating ownership, e.g. photocopies of title deeds, if applicable. d. A certificate by the legal adviser of the builder to the effect that the builder has a good reputation and it is free from encumbrance and other charges. e. A certificate from builders Chartered Accountant certifying that the builder has not mortgaged the property anywhere else. f. Certified true copy of approved plan. g. Copies of receipts of payments made to builder or developer. h. Allotment letter. i. Possession letter. j. Lease agreement, if applicable ( Property bought from a development authority) k. Mortgage deed if the bank opts for a registered mortgage. l. No objection certificate from the developer, society or development authority as applicable. m. Personal guarantees, if applicable. n. In case of alternate or additional security, documents for the same depending upon the security details. o. For self-construction: p. Approved plans and clearance certificates along with estimates.
q. Post dated cheques for the EMIs. The above documents are only indicative in nature and do not covers the entire list. It may also be noted that in a resale case, the previous chain of agreements also need to be taken.
N.B.:
1. The above documents represent an illustrative list. 2. In case of NRIs separate set of documents over and above the documents already stated, will be necessary.
1.4 The eligibility criteria considered for applying for a home loan are as follows:
1. The loan seeker should be an Indian resident or NRI, and should be salaried or self employed. 2. It may be difficult for the individuals who have other loans to be paid off to acquire the home loan. 3. The details of the individual such as the number of people financially dependent on the individual, the individuals credit repayment history and his saving habits are also considered. But individual have the scope of increasing his eligibility for acquiring the loan. At the same time the increasing the eligibility may affect his financial planning People can also enjoy some tax benefits by applying for home loans. Under section 80C of the Income Tax Act 1965: a) principal amount of repayment of loan along with other savings such as PF, PPF, Life Insurance premium etc. up to a maximum of Rs. 1,00,000/- will be eligible for deduction from gross income and b) interest paid on loan after completion of construction will be deductable from income from property.
People can be benefited by the home loans in various ways. They can make their dream of dream house come true with convenient packages from different HFCs. Moreover, the RBI has encouraged banks for provide bigger loans by granting priority sector status to housing loans up to Rs. 15 Lakhs. Along with these benefits, there are certain hassles involved in it. Cumbersome documentation procedures, taking long periods to sanction the amount, charging extra cost etc. are some of the risks involved in it. But there are a number of banks and HFCs are competing to grant loans, and each company is trying its best to capture the attention of the customer by offering handsome packages. So loan seekers can take advantage of the packages available considering certain factors like low interest rates, no extra costs etc.
CHAPTER 2
CHAPTER 2
Introduction
Helping Indians experience the joy of home ownership. The road to success is a tough and challenging journey in the dark where only obstacles light the path However, success on a terrain like this is not without a solution. As HDFC found out nearly three decades ago, in 1977, the solution for success is customer satisfaction. All you need is the courage to innovate, the skill to understand your clientele and the desire to give them your best. Today, nearly three million satisfied customers whose dream HDFC helped realise, stand testimony to our success. HDFCs objective, from the beginning, has been to enhance residential housing stock and promote home ownership.
Now, HDFCs offerings range from hassle-free home loans and deposit products, to property related services and a training facility. HDFC also offer specialised financial services to our customer base through partnerships with some of the best financial institutions worldwide.
2.1
History of HDFC ltd.

HDFC bank 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 from Housing Development Finance Corporation (HDFC), in 1994 during the period of liberalization of the banking sector in India. HDFC India was incorporated in August 1994 in the name of HDFC Bank Limited. HDFC India commenced operations as a Scheduled Commercial Bank in January 1995. HDFC India deals in varieties of products like Home loan, Standard life insurance, Mutual fund, Securities, Credit cards, etc. HDFC has branch offices in all major cities in India like Kolkata, Chennai, Delhi, Bangalore, Hyderabad, Ahemdabad apart from HDFC Mumbai. A two bed apartment? The sea facing penthouse? Or Just the right piece of land to build your dream house? HDFC Bank brings HDFC home loans to your doorstep. With over 25 years of experience, a dedicated team of experts and complete package to meet all your housing finance needs, HDFC Home loans, helps you realize your dream.
2.2
Advantages of HDFC Home Loan:

We have been a part of a 30 year journey with our 32 lakh customers. Our home loan
A) Home Loan Counseling: Sharing of over 30 years of Home loan experience. counselors offer you the time tested advice. Be it legal documentation, project or builder approvals, and technical advice we look forward to sharing with you and this service is absolutely free. Our project approval facility provides our customers the comfort of purchasing properties from builders who have complied with all basic documentation. B) Wide Product Range: We provide loans to meet all your requirements for you to make that house a home. Home Loans, Home Improvement Loans, Home Extension Loans, Loans to professionals for office or clinic, Home Equity Loans, Loan Against Rent receivables, Short Term Bridging Loan. Loans on Adjustable Rate, Fixed Rate. C) Multiple Repayment Option I. 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. II. 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. III.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 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.
IV. Accelerated Repayment Scheme: Accelerated Repayment Scheme offers you a great opportunity to repay the loan faster by increasing the EMI. Whenever you get an increment, increase in your disposable income or have lump sum funds for loan prepayment, you can benefit by
o o o
Increase in EMI means faster loan repayment Saving of interest because of faster loan repayment You can invest lump sum funds rather than use it for loan prepayment. The return from the investments also gives you the comfort of paying the increased EMI.
D) Wide Network of Financing: With over 200 offices, 90 outreach programs HDFC is able to provide home loans is over 2400 locations in India. You can apply at your local HDFC office for properties in locations where we finance. E) Post Disbursement Services: Income tax certificate to enable you to claim the tax benefits are sent to you. This service is absolutely free. Loan repayment: ECS facility Post dated cheques- No charges for replacement of cheques. Loan repayment at any HDFC offices.
2.3
Objectives & Background

Against the milieu of rapid urbanisation and a changing socio-economic scenario, the
Housing Finance Sector demand for housing has grown explosively. The importance of the housing sector in the economy can be illustrated by a few key statistics. According to the National Building Organisation (NBO), the total demand for housing is estimated at 2 million units per year and the total housing shortfall is estimated to be 19.4 million units, of which 12.76 million units is from rural areas and 6.64 million units from urban areas. The housing industry is the second largest employment generator in the country. It is estimated that the budgeted 2 million units would lead to the creation of an additional 10 million man-years of direct employment and another 15 million man-years of indirect employment. Having identified housing as a priority area in the Ninth Five Year Plan (1997-2002), the National Housing Policy has envisaged an investment target of Rs. 1,500 billion for this sector. In order to achieve this investment target, the Government needs to make low cost funds easily available and enforce legal and regulatory reforms. Background HDFC was incorporated in 1977 with the primary objective of meeting a social need - that of promoting home ownership by providing long-term finance to households for their housing needs. HDFC was promoted with an initial share capital of Rs. 100 million. Business Objectives The primary objective of HDFC is to enhance residential housing stock in the country through the provision of housing finance in a systematic and professional manner, and to promote home ownership. Another objective is to increase the flow of resources to the housing sector by integrating the housing finance sector with the overall domestic financial markets. Organisational Goals HDFC's main goals are to a) develop close relationships with individual households, b) maintain its position as the premier housing finance institution in the country, c) transform
ideas into viable and creative solutions, d) provide consistently high returns to shareholders, and e) to grow through diversification by leveraging off the existing client base.
2.4
Organisation & Management

HDFC is a professionally managed organisation with a board of directors consisting of
eminent persons who represent various fields including finance, taxation, construction and urban policy & development. The board primarily focuses on strategy formulation, policy and control, designed to deliver increasing value to shareholders. Board of Directors Details of the Board of Directors in terms of their directorships/memberships in committees of other public companies (excluding HDFC) are as under:
Sr. Name of Director No. 1 2 3 4 5 6 7 8 9 10 11 12 13 Mr. Deepak S. Parekh Mr. Keshub Mahindra Mr. Shirish B. Patel Mr. B. S. Mehta Mr. D. M. Sukthankar Mr. D. N. Ghosh Dr. S. A. Dave Dr. Ram S. Tarneja Mr. N. M. Munjee Dr. J. J. Irani Mr. D. M. Satwalekar Ms. Renu Sud Karnad Mr. K. M. Mistry
Category
No. of Directorship No. of Committees Member Chairperson
Executive Chairman Independent Independent Independent Independent Independent Independent Independent Independent Non-executive Independent+ Joint Managing Director Vice Chairman & Managing Director
12 5 1 14 4 4 11 13 13 10 5 13 12
7 1 0 9 1 1 9 7 9 2 2 5 8
5 1 0 5 1 1 0 2 4 0 2 2 3
2.5
Features and Benefit:

Home Loan: We offer home loans for individuals to purchase or construct houses.
Home loans can be applied for individually or jointly. HDFC finances up to 85% maximum of the cost of the property. (Agreement value + stamp duty + Registration charges ) . Home Improvement Loan: Home Improvement Loan facilitates internal and external repairs and other structural improvements like painting, waterproofing, plumbing and electric works, tiling and flooring, grills and aluminum windows. HDFC finances up to 85% of the cost of renovation. (100% for existing customers) Home Extension Loan: It facilitates the extension of an existing dwelling unit. All the terms are the same as applicable to Home Loan. Land Purchase Loan: Be it land for a dream house, or just an investment for future. HDFC Land Purchase Loan is a convenient loan facility to purchase land. HDFC finances up to 70% of the cost of land. Repayment of the loan can be done over a maximum period of 10 years. Chose from Fixed Rate or Floating Rate with options to structure your loan as Partly Fixed or Partly Floating. Flexible repayment options to suit your individual needs. Long cover Term Assurance Plan: HDFC Standard Life Insurance Company Ltd. Offers an insurance plan, which is designed to ensure that lifes uncertainties do not affect your familys interest and your precious home. LCTAP provides a lump-sum payment on the unfortunate demise of the life assured. This pure risk plan is designed in a way that the cover decreases as you repay your home loan making it a low cost premium insurance plan.
2.6
2007
Milestone of HDFC in 10 years.
Signing of joint venture by HDFC Ltd and ERGO on general insurance Mr Deepak Parekh Chairman, HDFC Ltd. with Dr.Nikolaus von Bomhard - CEO, Munich Re Group 2006 Rs. 1,00,000 Crore Home Loan Approvals HDFC Crosses Rs. 1,00,000 Crore in Home Loan Approvals Padma Bhushan Padma Bhushan for HDFC Chairman Deepak Parekh. The ICAI Award Ms. Renu Sud Karnad, Executive Director, HDFC receiving the ICAI Award from Mr. P C Gupta, Hon'ble Union Minister of State for Company Law Affairs 'The Best Presented Accounts' ICAI confers gold shield to HDFC for 'The Best Presented Accounts' 2005 Economic Times Corporate Citizen of the year award HDFC wins the Economic Times Corporate Citizen of the year award for its longstanding commitment to community development. 'Tiger Claws' wins the Gold Midas Award HDFC Environment ad titled 'Tiger Claws' wins the Gold Midas Award at the New York Festival. BPO Contract HDFC and Barclays sign long term BPO Contract. Barclays now holds 50% stake in Intel net, the balance 50% resides with HDFC. Ranked the 5th HDFC ranked the 5th Best Company to work for in India - Business Today 2004 Economic Times Lifetime Achievement award The Economic Times Lifetime Achievement award for HDFC Chairman, Mr. Deepak Parekh. US $ 200 million loan agreement HDFC signs US $ 200 million loan agreement with International Finance Corporation (IFC), Washington 2003 ICSI award for Excellence HDFC was awarded the ICSI award for Excellence in Corporate Governance for the year 2003. Loan Agreement for US $200 million HDFC signed a loan agreement for US $200 million with International Finance Corporation (IFC), Washington
2002 Joint venture with Chubb Corporation, USA A joint venture with Chubb Corporation, USA to promote HDFC-Chubb General Insurance Company Ltd. for non-life insurance Offer A group offer from HDFC for the benefit of its customers Crosses Rs. 50,000 crores HDFC Group's Asset base crosses Rs. 50,000 crores 2001 Promotes Credit Information Bureau (India) Ltd. (CIBIL) HDFC, State Bank of India, Dun & Bradstreet and Trans Union International Inc. (TU) promotes Credit Information Bureau (India) Ltd. (CIBIL) Among the Top 10 Asia's Best Managed Companies HDFC features among the Top 10 Asia's Best Managed Companies in the category of Banking and Finance - Euro money magazine Listed on the New York stock exchange HDFC Bank's American Depository Shares (ADS) are listed on the New York stock exchange. 2000 Inaugurates the new HDFC STANDARD LIFE Office in Mumbai HDFC Standard Life Insurance Company Limited becomes the first private insurer in India to obtain registration from the Insurance Regulatory and Development Authority (IRDA). Shri Yashwant Sinha, Union minister for finance , inaugurates the new HDFC STANDARD LIFE Office in Mumbai Joint venture with Mahindra & Mahindra group A joint venture with Mahindra & Mahindra group to promote propertymartindia.com, a website to provide a range of real estate services (renamed as HDFC Realty.com) First Mortgage Backed Securities HDFC issues its first Mortgage Backed Securities. GRUH becomes a subsidary of HDFC Aquires entire shareholding of Hometrust Housing Finance Company Limited. GRUH becomes a subsidary of HDFC Online approvals HDFC provides online approvals of loans through 1999 IMC Ramkrishna Bajaj National Trophy HDFC receives the IMC Ramkrishna Bajaj National Trophy for Business Excellence - the first company to receive this award in the Services category Investments HDFC invests in a new Housing Finance company in Sri Lanka.
www.hdfcindia.com launched HDFC website www.hdfcindia.com launched (now hdfc.com) Introduction: Adjustable Rate Home Loans HDFC the first housing finance institution to introduce the Adjustable Rate Home Loans 1998 "Best Managed company in India" HDFC voted as the "Best Managed company in India" in a survey of 250 fund managers, worldwide conducted by Asiamoney Partnership with a South-based NGO HDFC in partnership with a South-based NGO launches the Indian Association for Savings & Credit (IASC) - a pioneering micro-finance institution operating in the states of Tamil Nadu and Kerala Introduce: Home Equity Loans to corporate HDFC introduces Home Equity Loans and Corporate Employees Group Finance Arrangement (CEFA)
2.7
HDFC Future
HDFC has always been market-oriented and dynamic with respect to resource
mobilisation as well as its lending programme. This renders it more than capable to meet the new challenges that have emerged. Over the years, HDFC has developed a vast client base of borrowers, depositors, shareholders and agents, and it hopes to capitalise on this loyal and satisfied client base for future growth. Internal systems have been developed to be robust and agile, to take into account changes in the volatile external environment. HDFC has developed a network of institutions through partnerships with some of the best institutions in the world, for providing specialised financial services. Each institution is being fine-tuned for a specific market, while offering the entire HDFC customer base the highest standards of quality in product design, facilities and service.
CHAPTER 3
CHAPTER 3
Introduction
Research is commonly referred to search for knowledge. It is also definesResearch as a scientific and systematic search for the pertinent on specificTopic. It is also an art of scientific investigation. Research is a systematic method of collecting, recording facts, tabulating and analyzing the fact in the form of objective set as through conclusion over the problem based on the collected data.
3.1
Definitions:The word research is derived from the Latin word meaning to know. It is a systematic
and a replicable process which identifies and defines problems, within specified boundaries. It employs well designed method to collect the data and analyses the results. It disseminates the findings to contribute to generalize able knowledge.
Research methods are the particular strategies researchers use to collect the evidence necessary for building and testing theories Research is purposive analysis tries to establish a basis for prediction and control behavior of its studies. Research methodology has many dimensions and research methods are integral part of it. Research methodology has a wider scope that that the research methods. Research methodology is systematic way for solving research problem. It is a science of study how research is done scientifically. It is essential for any research to know not only research techniques but also research methodology. In research methodology we study the various steps that are generally adopted by researcher in studying his research problem along with logic behind them so that research result are capable of being evaluated either by the researcher himself or by any other person.
3.2
Objectives of the Study:
1) To study housing loan schemes. 2) To identify the most popular implemented schemes. 3) To make the comparison between Extension Plan and Readymade house Plan.
3.3
Hypothesis:
1) The market share of HDFC in housing finance sector is considerably increasing.

2) The customers are satisfied with the services provided by HDFC home loan.
3.4
Research Process
In the words of Albert Einstein formulation of a problem is far more essential than its
solution, which may be merely a matter of mathematical or experimental skill. To raise new possibilities, to regard old problems form a new angle requires creative imagination and market real advance in science. Research process consist of the steps of action to carry out which are closely related. All research problems require their own special emphases and approaches since every research problem is unique in some ways. There is a sequence of step called the marketing research process the following figure shows the different stages in research process.
FORMULATE PROBLEM
DETERMINE RESEARCH DESIGN
DETERMINE DATA COLLECTION METHOD
DESIGN DATA COLLECTION FORM
DESIGN SAMPLE AND COLLECTION DATA
ANALYSE AND INTERPRET THE DATA
Figure 3.1 Research Process
3.4.1 Formulating Research Problem:At the very outset the research must decide the general area of interest. Initially the problem may be stated in a broad general way and then narrow it down to specific problem. Problem definition involves in understanding the problem thoroughly and rephrasing the same in a suitable way in operation terms for the analysis. The researcher must examine all available literature to get familiarity with the problem. Literature, both, conceptual and empirical, must be reviewed properly. The outcome of which is useful in finalizing the data and other material available for operational purpose to specify the research problem. The problem to be investigated must be defined unambiguously that will help in discriminating the relevant data with irrelevant data. Once the problem is formulated a brief summary may be written down which is called as research plan.
3.4.2 Research Method Exploratory Research:Exploratory research is a type of research conducted because a problem has not been clearly defined. Exploratory research helps determine the best research design, data collection method and selection of subjects. Given its fundamental nature, exploratory research often concludes that a perceived problem does not actually exist. Exploratory research often relies on secondary research such as reviewing available literature and/or data, or qualitative approaches such as informal discussions with consumers, employees, management or competitors, and more formal approaches through in-depth interviews, focus groups, projective methods, case studies or pilot studies. The Internet allows for research methods that are more interactive in nature: The results of exploratory research are not usually useful for decision-making by themselves, but they can provide significant insight into a given situation. Although the results of qualitative research can give some indication as to the why, how and when something occurs, it cannot tell us how often or how many.
Descriptive Research:A descriptive research includes surveys and fact finding enquiries of different kinds. The major purpose of a descriptive research is description of the state of affairs as it exists in the present. The identification of the behavioral training requirements was descriptive research. The training Requirements were drawn out from the appraisal forms and entries were fed into data base. Causal Research :A causal approach gives the relation of one variable on the other and it gives the evidence of relationship. Descriptive research can show that two variables are related and causal research gives the evidence of relationship. Because the requirement for the proof of causality is so demanding the research question and relevant hypothesis is very specific.
3.4.3 Research (Design) Approach
It is the blue print of research. It is the conceptual structure within which research would conduct. A flexible research design, which provides opportunity for considering, many different aspects of problem and a suitable design will be one that minimizes bias and maximizes the reliability of the data collected and analyzed. The experimental and nonexperimental hypothesis testing are a few examples of research design. All research approach can be classified into one of two general categories of research: exploratory, descriptive and causal collection methods that are used. 3.4.4 Research Tactics Collection of the Data Good inference depends heavily on the appropriateness of the data. There are several ways of collection the appropriate data such as, by observation, through personal interviews,
(conclusive) differ significantly in terms of research
purpose, research questions the precision of the hypothesis that are formed, and the data
telephone interviews, by mailing questionnaires, through schedules etc, the research should select one of these methods of collection of data taking into consideration the nature, scope and objective. Data collection looks forward to data analysis, so the data requirements are to be well anticipated in advance. Special care must be taken in the collection phased to avoid the source of under or over statement for the various characteristics. The research should not ignore the already available relevant data that is secondary data. The usefulness of the research project depend on the overall quality of the research design, the data collected, and analyzed based on the design. Analysis of Data Once the data is collected, the analysis of the data is an important task. The analysis of data requires the number of operations, such as establishment of category codification of data, tabulation of data and then deriving the inferences. A research can analyze the collected data with the help of various statistical measures such as various percentages, and analysis of variances. The data analysis can be classified as univariate analysis where a single characteristic of interest is analyzed and in bivariate analysis and multivariate analysis deals with two and more than two characteristics of interest. 3.4.5 Methods used While Doing the Project Sources of Data: Primary Data Secondary Data
Primary Data: Primary data are those, which are collected afresh and for the first time, and thus happen to be original in character. Information regarding the company was collected through various discussions held with the concerned company executives handling the recruitment process. Valuable input and feedback concerning recruitment process was also obtained through interaction with recently selected employees of various departments with different profiles. Data regarding company history and profile were also gathered through informal discussions. a. Questionnaire: A structured questionnaire was used in which question about the processwere asked. Question related to interview, screening of resume were alsoInduced. In some case, the reply was not received. A structured questionnaire was used in which questions about recruitmentProcess was asked from the employees who went through interview. They were asked about questions like how they came to know about the vacancy and selection process. Questionnaire filled from recruiter also, like method of recruitment commonly adopted, stages of selection they carryout, minimum qualification they look for. b. Field Survey: In this field study the actual process of recruitment and selection wasExamined and witnessed. It started with receiving manpower sanction fromConcerned departments, short listing of the application on the basis ofQualification and age of candidate. Secondary Data: Data which are not originally collected but rather obtained from published orUnpublished sources are known as secondary data. It is second handInformation.
When an investigator uses the data, which has been already collected by others, such data is called as secondary data. This data is primary data for agency that collects it and become secondary data for someone else who uses this data for his own purpose. The secondary data can be obtained from journals, reports, and govt. publications, publications of professional& research organizations & so on. The secondary data required for this study is collected from companys website, magazines, & from already developed case studies. Literature Study: This data were collected from following sources, Company Websites Customer Suggestion Books
3.5
Limitations of Study
Every research has its own limitations likewise this study is having some of them.
1. This study aim to know the preference of people regarding HDFC Home Loan in only Wardha City. 2. The information is obtained from customers and thus findings are based on that information only. 3. The sample size was small that is of 100 respondents due to considerable limitations of time factor and economy. 4. This survey was based on random sampling technique. It is believed that responses in in such type of research cannot be taken granted heavily.
CHAPTER 4
HOME LOAN SCHEMES
CHAPTER 4
HOME LOAN SCHEMES
A new home brings with it new hopes, joys and emotions. At HDFC, we have shared new hopes, joys and emotions with over 32 Lakh customers. Every customer has a specific and unique concern. Having earned an experience of 30 years in home loans, Our home loan product is customised to provide you solutions for your unique concern.
4.1
Home Loan
4.1.1 Features Maximum loan 85% of the cost of the property (including the cost of the land) and based on the repayment
capacity of the customer. Maximum Term Applicant and Co- Applicant to the loan Home Loans can be applied for either individually or jointly. Proposed owners of the 20 years subject to your retirement age.
property will have to be co-applicants. However, the co-applicants need not be co owners. This facility is available to all type of home loan schemes.
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. This facility is also is available to all type of home loan schemes.
Fixed Rate
2-in-1 Home Loans A home-loan scheme that's twice as good! 2-in-1 Home Loan provides customers with a choice of breaking up the loan requirement into Adjustable and Fixed Rate loans. Customers benefit both ways, as it helps them hedge their interest rate risk against rising interest rates to the extent of the fixed rate portion of the loan and take the advantage of falling interest rates, with the Adjustable Rate portion. 2-in-1 Home Loans can be taken in any proportion. With no prepayment charges under the Adjustable Rate Home Loan, customers planning to make part prepayments can take a portion of the loan intended for prepayment under Adjustable Rate loan option; the rest can be taken under Fixed Rate Loan option. 4.1.2 Purpose
Purchase of
o Flat, row house, bungalow from developers o Existing freehold properties
o Properties in an existing or proposed co-operative housing society or apartment owner's association o First Power of Attorney purchases in Delhi for DDA flats allotted before 1992. Self Construction 4.1.3 Fees
1% of the loan amount applied plus applicable service taxes and cess. No Charges for

Replacement of cheques Income Tax Certificates Accelerated Repayment Option
4.1.4
Redemption Charges:
The redemption charges facilities are applicable to all the types of the home loan schemes which are described below. Adjustable Rate Home Loan [ARHL] If a prepayment is made within 3 years of the first disbursement, under Adjustable Rate Home Loan (ARHL) option early redemption charges of 2% of the amount being prepaid is payable if the amount being repaid is more than 25% of the opening balance. Fixed Rate Home Loan [FRHL] Redemption charges of 2% of the amount being prepaid is payable if the amount being repaid is more than 25% of the opening balance.
In case of commercial refinance under both the FRHL and ARHL an early redemption charge of 3% is payable. You may be required to submit copies of your Bank Statements or any other documents that HDFC deems necessary to verify the source of prepayment.
4.1.5 How to Apply It's simple! You can choose any of the following ways to get loan from HDFC bank.
Call the HDFC Home Line in your city - Sales representatives will reach out to you for assistance
HDFC Office Locator
HDFC has over 200 offices with flexible timings keeping in mind your work timings. The offices are conveniently located at a place closer to you.
SMS HDFCHOME to 56767 Apply Online
You can apply online also to get home loan from HDFC.
4.1.6 Documents
Salaried Customers Application form with photograph Identity and Residence Proof Latest Salary-slip Form 16 Last 6 months bank statements
Self Employed Professionals Application form with photograph Identity and Residence Proof Education Qualifications Certificate and Proof of business existence Last 3 years Income Tax returns (self and business) Last 3 years Profit /Loss and Balance Sheet
Self Employed Businessman Application form with photograph Identity and Residence Proof Education Qualifications Certificate and Proof of business existence Business profile 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 Processing fee cheque
Last 6 months bank statements (self and business) Processing fee cheque
4.1.7 Repayment Options
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 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.
Accelerated Repayment Scheme
Accelerated Repayment Scheme offers you a great opportunity to repay the loan faster by increasing the EMI. Whenever you get an increment, increase in your disposable income or have lump sum funds for loan prepayment, you can benefit by
o o o
Increase in EMI means faster loan repayment Saving of interest because of faster loan repayment You can invest lump sum funds rather than use it for loan prepayment. The
return from the investments also gives you the comfort of paying the increased EMI. 4.1.8 Security 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.
4.2
o o o o o o o o o o o
Home Improvement Loan

4.2.1 Features Purpose External repairs Tiling and flooring Internal and external painting Plumbing and electrical work Waterproofing and roofing Grills and aluminum windows Waterproofing on terrace Construction of underground/overhead water tank Paving of compound wall (with stone/tile/etc.) Bore well Maximum loan Existing Customer 100% of the cost of improvement
o
New Customer 85% of the cost of improvement Subject to market value of the property
Maximum Term
15 years subject to your retirement age
4.2.2
Fees
1% of the loan amount applied plus applicable service taxes and cess. No Charges for


35
D.B.A.R., S.S.G.M.C.E., Shegaon
4.2.3 Security
Existing customer
o Extension of the mortgage already created on the property financed and/or other security as may be required by HDFC.
New Customer
o For others, security for the loan is a mortgage on the entire property being improved and/or other security as may be required by HDFC.
4.3
Home Extension Loan

4.3.1 Features
Purpose
HDFC Home Extension Loan makes it convenient for you to extend or add space to your home. Be it an additional room, a larger bathroom, or even enclosing an open balcony.
Maximum loan
85% of the cost of extension
Maximum Term
20 years subject to your retirement age
4.3.2 Fees 1% of the loan amount applied plus applicable service taxes and cess. No Charges for


36
4.3.3 Security
o
Existing customer Extension of the mortgage already created on the property financed and/or other
security as may be required by HDFC.
New Customer
For others, security for the loan is a mortgage on the entire property being improved and/or other security as may be required by HD
4.4
Short Term Bridging Loan

Short-Term Bridging loan makes you realise your dream of buying a bigger and better
home and gives you time to sell your existing property to pay off the loan. This is a short term loan to help customers with the interim period between the sale of your old home and the purchase of a new home. You can take the loan even if you are an existing customer of HDFC.
4.4.1 Features
Maximum loan Maximum Term Applicant and Co - Applicant to the loan
90% of cost of new property
2 years
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 co-owners.
4.4.2 Fees 0.50% of the loan amount plus applicable service tax and cess.
4.4.3 Repayment Options Customers repay the loan by paying the monthly installment or pay the interest on the loan with a lump sum payment within 2 years. Hence the customer gets 2 years to sell the property and prepay the loan 4.4.4 Security Security for the loan is a first mortgage of the new property to be financed, normally by way of deposit of title deeds and/or such other collateral security as may be necessary. You would also have to give an irrevocable Power of Attorney authorising HDFC to sell your existing home. Moreover, both the proposed and existing homes would have to be insured against fire and other appropriate hazards. Interim security may be required, if the new property is under construction.
4.5
Land Purchase Loan

4.5.1 Features
Maximum loan Maximum Term
85% of cost of the land and based on the repayment capacity of the customer.
15 years subject to your retirement age.
4.5.2 Fees 1% of the loan amount applied plus applicable service taxes and cess. No Charges for

4.5.3 Security 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.
4.6 Loans to Professionals for Non Residential Premises Loan

4.6.1 Features
Purpose Eligible Doctors Chartered Accountants Lawyers Other self-employed professional Maximum loan Maximum Term
Purchase, Construction, Improvement of Office, Clinic

o o o o
85% of cost of the property
10 years Improvement 5 years. Non residential premises maximum term is 15 years, NRP improvement remains 5 years.
4.6.2 Fees 1% of the loan amount plus applicable service tax and cess.
4.6.3 Documents

Application form with photograph Identity and Residence Proof Education Qualifications Certificate and Proof of business existence Last 3 years Income Tax returns (self and business) Last 3 years Profit /Loss and Balance Sheet Last 6 months bank statement. Processing fee cheque 4.6.4 Security Security for the loan is a first mortgage of 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.
4.7
Home Equity Loans

HDFC Home Equity Loans helps you encash the present market value of the property by
taking a loan by mortgaging the property. 4.7.1 Features
Purpose
Loan can be for any purpose. However, the funds should not be used for speculation or any illegal purposes. Customers have benefited by taking loans to meet the following funding requirements
o o o
Education Marriage Expenses Medical Expenses

40
A COMPARATIVE STUDY OF TWO PLANS OF HOME LOANS OF HOUSING DEVELOPMENT FINANCIAL CORPORATION LTD. WARDHA o o
Property Residential Non Residential
- Should be Fully Constructed - Should be a Freehold property having a clear and marketable title.
o
Maximum Loan Existing Customers New Customers Subject to
- Balance of 60% of the market value and present loan outstanding

o
- 50% of the market value of the property (including the cost of the land)
o
- Minimum Market Value of the property being Rs.5,00,000 for Residential property and Rs.7.50 Lacks for Non Residential Property - Repayment Capacity of the customer
Maximum Term Repayment Option EMI Based EMI Based

Simple Interest
Property Type Residential Non Residential

Residential & Non Residential
No. of Years 15 10
2
- Subject to retirement age of the customer
4.7.2 Fees 1% of the loan amount plus applicable service tax and cess.
Security
Security for the loan is a first mortgage of property against which HDFC has advanced the loan. In addition, HDFC may request for additional, interim, collateral security. Liquid securities in the nature of shares, fixed deposits etc. may be accepted as additional securities on a selective basis.
CHAPTER 5
DATA ANALYSIS AND INTERPRETATION
CHAPTER 5
DATA ANALYSIS AND INTERPRETATION
5.1 Age wise profile of the respondents Age 18-25 26-30 31-35 36-40 41 and above No. of Respondent 4 18 24 35 19 % of Respondents 4 18 24 35 19
Table no. T 5.1 Age wise profile of the respondents

40 35 30 25 20 15 10 5 0 18-25 26-30 31-35 No.of respodent 36-40 41 and above 4 18 24 19 35
Graph no. G 5.1 Age wise profile of the respondents From the above Table and Graph, it is seen that the maximum respondents are from the age group 36 to 40 i.e. 35%. It is also seen that the minimum respondents are in the group 18 to 25 i.e. 4%.
5.2 Gender wise classification of the respondents Gender Male Female No. Of Respondent 82 18 % of Respondents 82 18
Table no. T 5.2 Gender wise classification of the respondents
90 80 70 No.of Respondents 60 50 40 30 20 10 0 No. Of respodent Male 82 Female 18
Graph no. G 5.2 Gender wise classification of the respondents
From the above Table and Graph, it is observed that the maximum number of respondents are male i.e. 82% and minimum number of respondents are female i.e. 18%.
5.3 Occupation wise profile of the respondents
Occupation Salaried (Govt.) Salaried (Private) Businessmen Self Employed
No. of Respondent 63 18 12 7
% of Respondents 63 18 12 7
Table no. T 5.3 Occupation wise profile of the respondents
12% 18%
7%
Salaried (Govt.) Salaried (Private) Businessmen Self Employed 63%
Graph no. G 5.3 Occupation wise profile of the respondents From the above Table and Pie chart, it is seen that major respondents are salaried (Govt.) i.e. 63% , the next large number of respondents are salaried (private) and the less number of respondents are self employed.
5.4 Income wise profile of the respondents
Income per Annum in Rs. 50,000 - 2,00,000 2,00,000 - 3,00,000 3,00,000 - 4,00,000 >4,00,000
No. of Respondents 27 39 21 13
Table no. T 5.4 Income wise profile of the respondents
13% 27% 50,000 - 2,00,000 2,00,000 - 3,00,000 3,00,000 - 4,00,000 >4,00,000
21%
39%
Graph no. G 5.4 Income wise profile of the respondents From the above Table and Pie chart, it is observed that, maximum respondents have income between Rs. 2, 00,000 3, 00,000 i.e.39%, and minimum number of respondents have income above Rs. 4, 00,000 i.e. 13%.
5.5 Home loan type customers choice Type of Home Loan Home Purchase Loan Home Extension Loan Home Construction Loan Home Improvement Loan Land Purchase Loan No. of Respondents 41 12 37 2 7 % of Respondents 41 12 37 2 7
Table no. T 5.5 Type of loan wise classification of respondents.
45 40 35 30 25 20 15 10 5 0
41
37
12 7 2 Home Purchase Loan Home Extension Loan Home Home Land Purchase Construction Improvement Loan Loan Loan No. of Respodents
Graph no. G 5.5 Type of loan wise classification of respondents.
From the above Table and Graph, it is seen that, maximum respondents i.e. 41% took loan for home purchase, followed by 37% respondents took loan for home construction and minimum respondents i.e. 2% took loan for home improvement.
5.6 Loan amount applied by the respondents Applied Loan Amount in Rs. < 2,00,000 2,00,000 - 4,00,000 4,00,000 - 6,00,000 > 6,00,000 No. of Respondents 23 42 29 6 % of Respondents 23 42 29 6
Table no. T 5.6 Loan amount applied by the respondents
45 40 35 30 25 20 15 10 5 0 <2,00,000 23
42
29
2,00,000 - 4,00,0004,00,000 - 6,00,000 No. of Respodents
>6,00,000
Graph no. T 5.6 Loan amount applied by the respondents
From the above Table and Graph, it is observed that, large number of respondents i.e.42% have applied for the amount between Rs. 2,00,000 4,00,000, and minimum number of respondents i.e. 6% have applied for loan amount above Rs. 6,00,000.
5.7 Sanctioned loan wise profile of the respondents % of Loan Sanctioned < 40% 40 - 55% 55 - 70% 70 - 85% No. of Respondents 0 9 28 63 % of Respondents 0 9 28 63
Table no. T 5.7 Sanctioned loan wise profile of the respondents
70 60 50 40 30 20 10 0 0 <40% 40 - 55% 55 - 70% 9 28
63
70 - 85%
No. of Respodents
Table no. T 5.7 Sanctioned loan wise profile of the respondents
From the above table and Graph, it is seen that, maximum respondents i.e. 63% got loan sanctioned between 70 85% and minimum respondents i.e. 9% got loan sanctioned between respondents 40 55%.
5.8 Interest rate wise classification of the respondents Interest Rate 6 - 8% 8 - 10% 10 - 12% > 12% No. of Respondent 0 0 46 54 % of Respondents 0 0 46 54
Table no. T 5.8 Interest rate wise classification of the respondents
60 50 40 30 20 10 0 0 6 - 8% 0 8 - 10% 10 - 12% 46
54
> 12%
No. of respodent
Graph no. G 5.8 Interest rate wise classification of the respondents
From the above Table and Graph, it is observed that, maximum numbers of respondents i.e. 54% are paying interest above 12% and minimum number of respondents i.e. 46% are paying respondents interest between 10 12%.
5.9 Tenure wise profile of the respondents
Repayment Period 5 years 5 -10 years 10 10 - 15 years 15 - 20 years
Table no. T 5.9 Tenure wise profile of the respondents
3%
14%
5 years 64% 5 -10 years 10 19% 10 - 15 years 15 - 20 years
Table no. T 5.9 Tenure wise profile of the respondents From the above table and pie chart, it is observed that, large number of respondents i.e. 64% pie-chart, have repayment period between 15 20 years for their loan, and minimum number of 15-20 nu respondents i.e. 3% have repayment period up to 5 years
5.10 Satisfaction derived by respondents regarding documentation procedure
Documentation Procedure Excellent Good Bad Complicated
Table no. T 5.10 Satisfaction derived by respondents regarding documentation procedure
60 50 40 30 20 10 0
54
33
4 Complicated
Excellent
Good
Bad
No. of Respodents
Graph no. G 5.10 Satisfaction derived by respondents regarding documentation procedure From the above table and graph, it is seen that, maximum respondents i.e. 54% feel that the documentation procedure is excellent, 33% feel that it is good, and the minimum respondents i.e. 4% feel that documentation procedure is complicated.
5.11 Satisfaction derived by the respondents regarding services. tion
Satisfaction Regarding service Yes No
No. of Respondents 89 11
% of Respondents 89 11
Table no. T 5.11 Satisfaction derived by the respondents regarding services.
11%
Yes No
89%
Graph no. G 5.11 Satisfaction derived by the respondents regarding services. From the above table and pie chart, it is seen that, maximum respondents i.e. 89% are satisfied by the services provided by the bank. And minimum numbers of respondents i.e. 11% are not satisfied by the services provided by the bank. es
5.12 Ranking derived by the respondents to bank.
Points on Scale 1 to 10 1 to 3 3 to 5 5 to 7 7 to 10
Table no. T 5.12 Ranking derived by the respondents to bank
50 40 30 20 10 0 1 to 3 3 to 5 5 to 7 2 17 37
44
7 to 10
No. of Respodents
Graph no. G 5.12 Ranking derived by the respondents to bank From the above table and graph, it is observed that, maximum respondents i.e. 44% have given points between 7 10 to bank and minimum respondents i.e. 2% have given points between 1 - 3.
5.13 Factor wise classification of the respondents.
Very Factors Interest Rate Repayment Schedule Tenure Document Convenience Important. 78 72 54 70 Important. 19 22 35 25
Slightly Important. 3 6 11 5
Cumulative Score 275 266 243 265
Table no. T 5.13 Factor wise classification of the respondents. Scale used: Three point scale: 3 Very Important, 2 Important, 1 Slightly Important.
280 270 260 250 240 230 220
275 266 265
243
Interest Rate
Repayment Schedule
Tenure
Document Convenience
cumulative score
Graph no. G 5.13 Factor wise classification of the respondents. From the above table and graph, it is observed that, the most important factor considered by most respondents is Interest rate, and the second most important factor is repayment schedule, and the least important factor is Tenure.
COMPARATIVE ANALYSIS OF HOME PURCHASE LOAN AND HOME EXTENSION LOAN:

5.14 Age wise comparison between home purchase and home extension loan. Home Purchase Loan Age Group 18 - 25 26 - 30 31 - 35 36 - 40 41 and Above Percentage 2.43 21.95 29.26 31.70 14.63 Number 1 9 12 13 6 Home Extension Loan Percentage 0 8.33 16.66 33.33 41.66 Number 0 1 2 4 5
Table no. T 5.14 Age wise comparison between home purchase and home extension loan.
50.00% 40.00% 30.00% 20.00% 10.00% 0.00% 2.43% 0% 26 - 30 31 - 35 36 - 40 29.26% 21.95% 8.33% 16.66% 31.70% 33.33%
41.66%
14.63%
18 - 25
41 and Above
Home Purchase Loan
Home Extension Loan
Graph no. G 5.14 Age wise comparison between home purchase and home extension loan. From the above table and graph, it is seen that, maximum respondents who have took home purchase loan i.e. 31.70% are in the age group of 36 40, and minimum respondent are 2.43% who are in the age group of 18 25. Similarly maximum respondents who have took home extension loan i.e. 41.66% are in the age group of 41 and above, and minimum respondents are and 8.33% who are in the age group of 26 30.
5.15 Gender wise comparison between home purchase and home extension loan respondents.
Male Gender Home Purchase Loan Home Extension Loan Percentage 85.36 75 Number 35 9
Female Percentage 14.64 25 Number 6 3
Table no. T 5.15 Gender wise comparison between home purchase and home extension loan respondents.
100.00% 80.00% 60.00% 40.00% 20.00% 0.00%
85.36%
75%
14.64%
25%
Male Home Purchase Loan
Female Home Extension Loan
Graph no. G 5.15Gender wise comparison between home purchase and home extension loan respondents. From the above table and graph, it is observed that, maximum respondents who took home purchase loan are male i.e. 85.36% and minimum respondents are female i.e. 14.64%. Similarly, maximum respondents who took home extension loan are also male i.e. 75% and minimum respondents are female i.e. 25%. dents
5.16 Occupation wise comparison between home purchase and home extension loan respondents.
Home Purchase Loan Occupation Salaried (Govt.) Salaried (Private) Businessmen Self Employed Professional 7.32 3 Percentage 65.85 17.08 9.75 Number 27 7 4
Home Extension Loan Percentage 50 33.33 17.67 0 Number 6 4 2 0
Table no. T 5.16 Occupation wise comparison between home purchase and home extension loan respondents.
70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00%
65.85% 50% 33.33% 17.08% 9.75% 17.67% 7.32% 0%
Salaried (Govt.)
Salaried (Private)
Businessmen Home Extension Loan
Home Purchase Loan
Self Employed Professional
Graph no. G 5.16 Occupation wise comparison between home purchase and home extension loan respondents. From the above table and graph, it is observed that, large number of respondents who took home purchase loan are salaried (Govt.) i.e. 65.85%, and minimum respondents are self employed professional i.e. 7.32%. similarly, maximum respondents who took home extension loan are also salaried ( govt.) and minimum respondents are self employed professional i.e. 0%.
5.17 Income wise comparison of the respondents between home purchase and home extension loan. Income Per Annum in Rs. < 2,00,000 2,00,000 - 3,00,000 3,00,000 - 4,00,000 > 4,00,000 Home Purchase Loan Percentage 31.70 41.46 17.0 9.75 Number 13 17 7 4 Home Extension Loan Percentage 25 33.33 25 17.67 Number 3 4 3 2
Table no. T 5.17 Income wise comparison of the respondents between home purchase and home extension loan.
45.00% 40.00% 35.00% 30.00% 25.00% 20.00% 15.00% 10.00% 5.00% 0.00%
41.46% 31.70% 25% 17.08% 9.75% 33.33% 25% 17.67%
< 2,00,000
2,00,000 3,00,000 Home Purchase Loan
3,00,000 > 4,00,000 4,00,000 Home Extension Loan
Graph no. G 5.17 Income wise comparison of the respondents between home purchase and home extension loan. From the above table and graph, it is seen that, maximum respondents of home purchase loan are 41.46% who are in income group of Rs. 2, 00,000 3, 00,000; and minimum respondents ; are 9.75% who are having income above Rs. 4, 00,000. Similarly maximum respondents of . respo home extension loan are 33.33% who are in income group of Rs. 2, 00,000 3, 00,000; and , minimum respondents are 17.67 who are having income above Rs. 4, 00,000. 17.67% , 00,000
5.18 Loan amount wise comparison between home purchase and home extension loan respondents. Loan Amount in Rs. < 2,00,000 2,00,000 - 4,00,000 4,00,000 - 6,00,000 > 6,00,000 Home Purchase Loan Percentage 19.51 43.90 26.83 9.76 Number 8 18 11 4 Home Extension Loan Percentage 25 41.66 25 8.33 Number 3 5 3 1
Table no. T 5.18 Loan amount wise comparison between home purchase and home extension loan respondents.
50.00% 40.00% 30.00% 20.00% 10.00% 0.00% < 2,00,000 2,00,000 4,00,000 4,00,000 6,00,000 Home Purchase Loan Home Extension Loan > 6,00,000 19.51% 9.76% 8.33% 25% 43.90%
41.66% 26.83%
25%
Graph no. G 5.18 Loan amount wise comparison between home purchase and home extension loan respondents From the above table and graph, it is observed that, maximum respondents of home purchase loan i.e. 43.90% have applied for loan amount between Rs. 2,00,000 4,00,000; and minimum respondents i.e. 9.76% have applied for loan amount above Rs. 6,00,000. Similarly maximum Si respondents of home extension loan i.e. 41.66% have applied for loan amount between Rs. 2,00,000 -4,00,000; and minimum respondents i.e. 8.33% have applied for loan amount above 4,00,000; Rs. 6,00,000.
5.19 Sanctioned loan wise comparison between home purchase and home extension loan respondents. % of Loan Sanctioned < 40% 40 - 55% 55 - 70% 70 - 85% Home Purchase Loan Percentage 0 2.43 31.70 65.85 Number 0 1 13 27 Home Extension Loan Percentage 0 25 33.33 41.66 Number 0 3 4 5
Table no. T 5.19 Sanctioned loan wise comparison between home purchase and home extension loan respondents.
70% 60% 50% 40% 30% 20% 10% 0%
65.85% 41.66%
25% 0% 0% 2.43% 40 - 55% Home Purchase Loan
31.70% 33.33%
< 40%
55 - 70% Home Extension Loan
70 - 85%
Graph no. G 5.19 Sanctioned loan wise comparison between home purchase and home extension loan respondents. From the above table and graph, it is observed that, maximum loan sanctioned for home that, purchase between 70 85% for 65.85% respondents and for home extension loan between 70 85% for 41.66% respondents. Similarly minimum loan sanctioned for home purchase loan between 40 55% for 2.43% respondents, and for home extension loan between 40 55 % for 33.33% respondents.
5.20 Interest rate wise comparison of home purchase and home extension loan respondents.
Home Purchase Loan Interest Rate 6-8% 8 -10 % 10 - 12 % > 12 % Percentage 0 0 43.90 56.10 Number 0 0 5 7
Home Extension Loan Percentage 0 0 41.66 58.33 Number 0 0 18 23
Table no. T 5.20 Interest rate wise comparison of home purchase and home extension loan respondents
70% 60% 50% 40% 30% 20% 10% 0% 0% 0% 0% 0% 10 - 12 % Home Extension Loan > 12 % 43.90% 41.66% 56.10%
58.33%
6-8%
8 -10 %
Home Purchase Loan
Graph no. G 5.20 Interest rate wise comparison of home purchase and home extension loan respondents From the above table and graph, it is observed that, maximum respondents of home purchase loan i.e. 56% are paying interest rate above 12% and that of home extension loan i.e. 58.33% are also paying interest rate above 12%. Similarly minimum respondents of home purchase loan i.e. 43.90% are paying interest rate between 10 12% and that of home extension loan i.e. 41.66% are paying interest rate between 10 12%.
5.21 Tenure wise comparison of home purchase and home extension loan respondents. Home Purchase Loan Repayment Period 5 yrs 5 - 10 yrs 10 - 15 yrs
15 - 20 yrs
Home Extension Loan Percentage 0 17.67 25

58.33
Percentage 0 2.43 29.26

68.29
Number 0 1 12
28
Number 0 2 3
7
Table no. T 5.21 Tenure wise comparison of home purchase and home extension loan respondents.
80% 70% 60% 50% 40% 30% 20% 10% 0%
68.29% 58.33%
29.26% 17.67% 0% 0% 2.43%
25%
5 yrs 5 - 10 yrs Home Purchase Loan
10 - 15 yrs 15 - 20 yrs Home Extension Loan
Graph no. G 5.21 Tenure wise comparison of home purchase and home extension loan respondents. From the above table and graph, it is seen that, maximum respondents of home purchase loan i.e. 68.29% have the repayment period between 15 20 years and that of home extension loan i.e. 58.33% have also the repayment period between 15 20 years. Similarly minimum respondents of the home purchase loan i.e. 2.43% have the repayment period between 5 10 years and that of home extension loan i.e. 17.67% have also the repayment period between 5 10 years.
5.22 Comparison between home purchase and home extension loan regarding satisfaction
derived by respondents about Documentation procedure. Documentation Procedure Excellent Good Bad Complicated Home Purchase Loan Percentage 60.97 31.70 4.87 2.43 Number 25 13 2 1 Home Extension Loan Percentage 58.33 33.33 8.33 0 Number 7 4 1 0
Table no. T 5.22 Comparison between home purchase and home extension loan regarding satisfaction derived by respondents about Documentation procedure.
70.00% 60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00%
60.97% 58.33% 33.33% 31.70% 4.87% Exellent Good 8.33%
2.43%
0%
Bad
Complicated
Home Purchase Loan
Hpme Extension Loan
Graph no. G 5.22 Comparison between home purchase and home extension loan regarding satisfaction derived by respondents about Documentation procedure. From the above table and graph, it is observed that, maximum respondents of home purchase graph, loan i.e. 60.97% feel that the documentation procedure is excellent and that of the home extension loan i.e. 58.33% feel that documentation procedure is excellent. Similarly minimum respondents of home purchase loan i.e. 2.43% feel that the documentation procedure is s complicated and that of home extension loan i.e. 0% feel that documentation procedure is complicated.
5.23 Comparison between home purchase and home extension loan regarding satis satisfaction derived by respondents about services. Yes Satisfaction Home Purchase Loan Home Extension Loan Percentage 92.68 100.00 Number 38 12 7.32 0 No Percentage Number 3 0
Table no. T 5.23 Comparison between home purchase and home extension loan regarding satisfaction derived by respondents about services.
120.00% 100.00% 80.00% 60.00% 40.00% 20.00% 0.00% 92.68%
100.00%
7.32% Yes Home Purchase Loan No Home Extension Loan
0%
Graph no. G 5.23 Comparison between home purchase and home extension loan regarding satisfaction derived by respondents about services.
From the above table and graph, it is observed that, maximum respondents of home purchase loan i.e. 92.68% are satisfied and that of the home extension loan i.e. 100% are satisfied with the services provided by bank. Similarly, minimum respondents of home purchase loan i.e. 7.32% are dissatisfied with the se services provided by the bank.
5.24 Comparison between home purchase and home extension loan regarding ranking given by the respondents to the bank. Home Purchase Loan Ranking 1 To 3 3 To 5 5 To 7 7 To 10 Percentage 2.43 12.19 31.70 53.65 Number 1 5 13 22 Home Extension Loan Percentage 0 17.67 33.33 50 Number 0 2 4 6
Table no. T 5.24 Comparison between home purchase and home extension loan regarding ranking given by the respondents to the bank.
60.00% 50.00% 40.00% 30.00% 20.00% 10.00% 0.00% 2.43% 0% 1 To 3 3 To 5 5 To 7 17.67% 12.19% 33.33% 31.70%
53.65%
50%
7 To 10
Home Purchase Loan
Home Extension Loan
Graph no. G 5.24 Comparison between home purchase and home extension loan regarding ranking given by the respondents to the bank. From the above table and graph, it is observed that, maximum respondents of home purchase loan i.e. 53.65% and that of home extension loan i.e. 50% have given the rank between 7 10. Similarly, minimum respondents of home purchase loan i.e. 2.43% and that of home extension loan i.e. 0% have given rank between 1 3.
CHAPTER 6
CONCLU IONS AND CONCLUSIONS SUGGESTIONS
CHAPTER 6
CONCLUSIONS AND SUGGESTIONS
Conclusions
The study has derived certain conclusions as follows
As per demographic profile, maximum respondents who borrowed home loan are under the age group of 36 40 years. It clearly shows that, this age group segment is well acquainted with financial services offered by the bank and for home improvement, modification etc. they are opting for home loan. As per gender wise classification of the respondents, it is observed that, maximum respondents are male; it shows that still in important buying decisions there is a high involvement of male. It was found that, among respondents maximum Government salaried employees borrowed home loan i.e. 63%, while minimum respondents were self employed professional i.e. 7%.
It was found that, respondents having income between Rs. 2,00,000 3,00,000 per annum borrowed home loan are maximum i.e. 39%. borrowing decisions among maximum respondents. Maximum respondents took home loan for the purpose of home purchase i.e. 41%. Next more preferred loan was home construction loan and respondents were 37%, and minimum respondents took home loan for the purpose of home improvement loan i.e. 2%. It was found that, maximum respondents i.e.42% applied for loan amount between Rs. 2,00,000 to 4,00,000 and minimum respondents i.e.6% applied for loan amount above Rs. 6,00,000. It was found that, maximum respondents i.e. 54% are paying interest rate more than 12%, and minimum respondents i.e. 46% are paying interest rate between 10 12%. Among total respondents maximum respondents i.e. 64% took loan for the period between 15 20 years. And only 17% respondents took loan for the period less than 10 years. It was found that, maximum number of respondents who borrowed loan from HDFC bank are satisfied with the services provided by the bank. 89% respondents are satisfied, while only 11% are dissatisfied. It was observed that, the most important factor considered by respondents is Interest rate, and the second most important factor is repayment schedule, and the least important factor is Tenure. Income level influenced the home loan
Conclusion from comparison between home purchase loan and home extension loan.
It was seen that, maximum respondents who have took home purchase loan i.e. 31.70% are in the age group of 36 40, and minimum respondent are 2.43% who are in the age group of 18 25. Similarly maximum respondents who have took home extension loan i.e. 41.66% are in the age group of 41 and above, and minimum respondents are 8.33% who are in the age group of 26 30.
It was observed that, maximum respondents who took home purchase loan are male i.e. 85.36% and minimum respondents are female i.e. 14.64%. Similarly, maximum respondents who took home extension loan are also male i.e. 75% and minimum respondents are female i.e. 25%.
It was observed that, large number of respondents who took home purchase loan are salaried (Govt.) i.e. 65.85%, and minimum respondents are self employed professional i.e. 7.32%. Similarly, maximum respondents who took home extension loan are also salaried (Govt.) and minimum respondents are self employed professional i.e. 0%. It was found that, maximum respondents of home purchase loan are 41.46% who are in income group of Rs. 2, 00,000 3, 00,000; and minimum respondents are 9.75% who are having income above Rs. 4,00,000. Similarly maximum respondents of home extension loan are 33.33% who are in income group of Rs. 2, 00,000 3, 00,000; and minimum respondents are 17.67% who are having income above Rs. 4,00,000. It was observed that, maximum respondents of home purchase loan i.e. 43.90% have applied for loan amount between Rs. 2, 00,000 4, 00,000; and minimum respondents i.e. 9.76% have applied for loan amount above Rs. 6, 00,000. Similarly maximum respondents of home
extension loan i.e. 41.66% have applied for loan amount between Rs. 2, 00,000 -4, 00,000; and minimum respondents i.e. 8.33% have applied for loan amount above Rs. 6, 00,000. It was observed that, maximum respondents of home purchase loan i.e. 56% are paying interest rate above 12% and that of home extension loan i.e. 58.33% are also paying interest rate above 12%. Similarly minimum respondents of home purchase loan i.e. 43.90% are paying interest rate between 10 12% and that of home extension loan i.e. 41.66% are paying interest rate between 10 12%. It was seen that, maximum respondents of home purchase loan i.e. 68.29% have the repayment period between 15 20 years and that of home extension loan i.e. 58.33% have also the repayment period between 15 20 years. Similarly minimum respondents of the home purchase loan i.e. 2.43% have the repayment period between 5 10 years and that of home extension loan i.e. 17.67% have also the repayment period between 5 10 years.
It was observed that, maximum respondents of home purchase loan i.e. 92.68% are satisfied and that of the home extension loan i.e. 100% are satisfied with the services provided by bank. Similarly, minimum respondents of home purchase loan i.e. 7.32% are dissatisfied with the services provided by the bank.
Suggestions
1. HDFC Ltd should target their promotional efforts to youth segment of population who have started their careers and desirous to their Dream Home. 2. Company can incorporate innovative schemes to attract lower income group people so that they can avail benefits offered by the company. 3. Company should try to focus on businessman and self employed .professionals to attract them towards their Home Loan schemes. Company should recruit competent sales people who find out potential customer among the above said group. 4. It was found that customers were not attracted towards the Home Loan schemes like Home Improvement Loan & Land Purchase Loan. For this the bank should increase their personal selling and by better advertisement of these schemes they should attract the target customers. 5. It was observed that, the income group above Rs. 4,00,000 per annum have very less share in business of HDFC in Wardha city, therefore HDFC should take some steps to target this income group particularly. 6. It was found that, the percentage of female customers opted for home loan is very less, as this group has great market potential in todays era, therefore HDFC should take some steps to target this customer group. 7. Bank should use the sources of advertisement like T.V. and internet effectively and try to make customers aware of them.
BIBLIOGRAPHY
BIBLIOGRAPHY
Books: Dr.TVS Arun Murthy & Dr. D.G. Wakde, Research Methodology. HDFC bank annual magazine.
Pamphlets: HDFC, Home Loan Company
Website: www.apmaloan.com www.hdfc.com www.indiaground.com www.moneycontrol.com
APPENDIX
APPENDIX
Questionnaire
Dear Respondent, I am student of MBA final year, D.B.A.R., S.S.G.M.C.E., Shegaon, and doing research project on A COMPARATIVE STUDY OF TWO PLANS OF HOME LOANS OF HOUSING DEVELOPMENT FINANCIAL CORPORATION LTD., WARDHA. Your views are very important for me and my research work. So, I kindly request you to fill up the questionnaire and co-operate me. AVINASH E. MOREY MBA (Finance) 1] Name of Respondent: -------------------------------------------------------------------------------2] Age: ----------------------------------------3] Gender: a) Male 4] Occupation: a) Salaried (Govt.) c) Businessmen 5] Income per annum: a) 50,000-2,00,000 c) 3,00,000-4,00,000 [ [ ] ] b) 2,00,000-3,00,00 d) > 4,00,000 [ [ ] ] [ [ ] ] b) Salaried (Private) [ ] ] [ ] b) Female [ ]
d) Self employed professional [
6] Among the various types of home loan for which type have you taken loan? a) Home purchase loan c) Home construction loan e) Land purchase loan [ [ [ ] ] ]
b) Home extension loan
] ]
d) Home improvement loan [
7] For what amount of loan have you applied to the bank? a) < 2,00,000 c) 4,00,000 - 6,00,000 [ [ ] ] b) 2,00,000 - 4,00,000 d) >6 ,00,000 [ [ ] ]
8] Percentage of loan have been sanctioned by the bank than you applied for a) < 40% c) 55 - 70% 9] What is the interest rate type? a) Fixed [ ] b) Floating [ ] [ [ ] ] b) 40 - 55% d) 70 - 85% [ [ ] ]
10] What interest rate you are paying? a) 6-8% c) 10-12% [ [ ] ] b) 8-10% d) > 12% [ [ ] ]
11] What is the period for the repayment of loan? a) 5 years c) 10-15 years [ [ ] ] b) 5-10 years d) 15-20 years [ [ ] ]
12] What is your opinion about the documentation procedure? a) Excellent c) Bad [ [ ] ] b) Good d) Complicated [ [ ] ]
13] What factors do you have think over while taking loan? Please tick [ ] Sr. no. 1 2 3 4 Factors Interest rate Repayment schedule Tenure Document convenience Very Important Important Slightly Important
14] Are you satisfied with the services provided by HDFC? a) Yes [ ] b) No [ ]
15] How much point would you like to give HDFC bank in a scale 1 to 10? a) 1-3 b) 5-7 [ [ ] ] b) 3-5 d) 7-10 [ [ ] ]
THANK YOU

Comparative Study of Home Loans With HDFC Ltd. by AVINASH MOREY

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Comparative Study of Home Loans With HDFC Ltd. by AVINASH MOREY

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A DISSERTATION ON

SANT GADGE BABA AMRAVATI UNIVERSITY, AMRAVATI

Mr. AVINASH E. MOREY

D.B.A.R., S.S.G.M.C.E., SHEGAON ,

DEPARTMENT OF BUSINESS ADMINISTRATION AND RESEARCH

SANT GADGE BABA AMRAVATI UNIVERSITY, AMRAVATI

Mr. AVINASH E. MOREY

D.B.A.R., S.S.G.M.C.E., SHEGAON

DEPARTMENT OF BUSINESS ADMINISTRATION AND RESEARCH

(Accredited By N.B.A, New Delhi & ISO 9001:2000) Website: http://www.ssgmce.org

Department Of Business Administration and Research

DATE: PLACE: SHEGAON

Mr. AVINASH E. MOREY MBA II YEAR (FINANCE)

Mr. AVINASH E. MOREY

HOME LOAN SCHEMES

DATA ANALYSIS AND INTERPRETATION CONCLUSSIONS AND SUGGESTIONS BIBLIOGRAPHY APPENDIX

T 5.11 T 5.12 T 5.13

home extension loan respondents.

1.1 Concepts of Home Loans

4 D.B.A.R., S.S.G.M.C.E., Shegaon

1.2 Need for Home Loan

5 D.B.A.R., S.S.G.M.C.E., Shegaon

1.3 Home Loan Documentation

E. Name Change Proof: (If Applicable)

F. Investment Proof: (If Applicable)

G. Property Title Proof:

10 D.B.A.R., S.S.G.M.C.E., Shegaon

11 D.B.A.R., S.S.G.M.C.E., Shegaon

History of HDFC ltd.

12 D.B.A.R., S.S.G.M.C.E., Shegaon

Advantages of HDFC Home Loan:

Objectives & Background

15 D.B.A.R., S.S.G.M.C.E., Shegaon

Organisation & Management

No. of Directorship No. of Committees Member Chairperson

16 D.B.A.R., S.S.G.M.C.E., Shegaon

Features and Benefit:

17 D.B.A.R., S.S.G.M.C.E., Shegaon

Milestone of HDFC in 10 years.

20 D.B.A.R., S.S.G.M.C.E., Shegaon

Objectives of the Study:

1) The market share of HDFC in housing finance sector is considerably increasing.

22 D.B.A.R., S.S.G.M.C.E., Shegaon

DETERMINE RESEARCH DESIGN

DETERMINE DATA COLLECTION METHOD

DESIGN DATA COLLECTION FORM

DESIGN SAMPLE AND COLLECTION DATA

ANALYSE AND INTERPRET THE DATA

Figure 3.1 Research Process

23 D.B.A.R., S.S.G.M.C.E., Shegaon

(conclusive) differ significantly in terms of research

26 D.B.A.R., S.S.G.M.C.E., Shegaon

27 D.B.A.R., S.S.G.M.C.E., Shegaon

28 D.B.A.R., S.S.G.M.C.E., Shegaon

HOME LOAN SCHEMES

Adjustable Rate Home Loan

o Flat, row house, bungalow from developers o Existing freehold properties

30 D.B.A.R., S.S.G.M.C.E., Shegaon

Replacement of cheques Income Tax Certificates Accelerated Repayment Option

31 D.B.A.R., S.S.G.M.C.E., Shegaon

HDFC Office Locator

SMS HDFCHOME to 56767 Apply Online

32 D.B.A.R., S.S.G.M.C.E., Shegaon