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PROJECT REPORT

On

HOME LOANS
IN

INDIA BULLS
Submitted to:

Kurukshetra University, Kurukshetra


In partial fulfillment of requirement of B.Com 1st Year (Computer Application)
Session 2007-2008

Submitted to:
Mr. Sushil Kumar (Lecturer)

Submitted by:
Amar Ved College Roll No.2058 Univ. Roll no..

GOVT. (PG) COLLEGE AMBALA CANTT

INDEX Sr. No.

1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11.

ACKNOWLEDGEMENT. PREFACE LOAN HOME LOAN COMPANY PROFILE PROCEDURE FOR A LOAN COMPUTERIZED SYSTEM ADVANTAGES CONSTRAINTS DISADVANTAGES OF COMPUTERISATION CONCLUSION

PREFACE
The objective of this on the job-training project is to develop information search, skills into students this would enable students to gather information in a systematic and conclusively planned manner. Computers are now affecting every sphere of human activity and bringing about many changes in industries, education, medicine and even arts like music and printing. The emphasis has shifted from physical and mechanical labour needed to certain the new information revolution. Todays computers have given us the information that renewable and self-generating so all organizations are putting computers to work. Computers have completely alerted the structure of the business, large amount of accounting and record-keeping data can be manipulated, organized, stored, retrieved and used for scientific purpose.

ACKNOWLEDGEMENT

Can words express the heartfelt feelings and gratitude? But words are too weak to express the expression of once feeling. As the intensify in our sentiments deepens we find no words and fail to express them. Therefore No words are better than thanks. With great pleasure and sense of gratitude I express My sincere appreciation to my guide MR. SUSHIL KUMAR Of department of computer science and applications, GOVT. (PG) COLLEGE, Ambala Cantt who is very inspiring Personality. It shall be very difficult for me to find Words for expressing my gratitude towards him for providing me energetic inspiration, Expert guidance and creative suggestion and encouragement at all time during the period.

AMAR VED B.Com. 1st Comp. App.

LOAN
A loan is a type of debt. All material things can be lent but this article focuses exclusively on monetary loans. Like all debt instruments, a loan entails the redistribution of financial assets over time, between the lender and the borrower. The borrower initially receives an amount of money from the lender, which they pay back, usually but not always in regular installments, to the lender. This service is generally provided at a cost, referred to as interest on the debt. A borrower may be subject to certain restrictions known as loan covenants under the terms of the loan. Acting as a provider of loans is one of the principal tasks for financial institutions. For other institutions, issuing of debt contracts such as bonds is a typical source of funding. Bank loans and credit are one way to increase the money supply. Legally, a loan is a contractual promise of a debtor to repay a sum of money in exchange for the promise of a creditor to give another sum of money.

HOME LOAN

A secured loan is a loan in which the borrower pledges some asset (e.g. a car or property) as collateral for the loan. A mortgage loan is a very common type of debt instrument, used by many individuals to purchase housing. In this arrangement, the money is used to purchase the property. The financial institution, however, is given security - a lien on the title to the house - until the mortgage is paid off in full. If the borrower defaults on the loan, the bank would have the legal right to repossess the house and sell it, to recover sums owing to it. In some instances, a loan taken out to purchase a new or used car may be secured by the car, in much the same way as a mortgage is secured by housing. The duration of the loan period is considerably shorter - often corresponding to the useful life of the car. There are two types of auto loans, direct and indirect. A direct auto loan is where a bank gives the loan directly to a consumer. An indirect auto loan is where a car dealership acts as an intermediary between the bank or financial institution and the consumer. A type of loan especially used in limited partnership agreements is the recourse note.

A stock hedge loan is a special type of securities lending whereby the stock of a borrower is hedged by the lender against loss, using options or other hedging strategies to reduce lender risk.[citation needed]

Unsecured Unsecured loans are monetary loans that are not secured against the borrowers assets. These may be available from financial institutions under many different guises or marketing packages: credit card debt, personal loans, bank overdrafts credit facilities or lines of credit corporate bonds The interest rates applicable to these different forms may vary depending on the lender, the borrower. These may or may not be regulated by law.

COMPANY PROFILE
Indiabulls was incorporated in 2000, and became Indiabulls Financial Services Limited as a Public Limited Company in 2004. Today it enjoys a leading position in finance and real estate services in India. Presently its expanse includes around 640 branches and over 4.5 Lacs customers. Indiabulls Financial Services Ltd. has listings in National Stock Exchange (NSE), Bombay Stock Exchange (BSE) and Luxembourg Stock Exchange. The net worth of Indiabulls in the present financial year is 510 million US Dollars. Some of the largest financial institutions like Fidelity Funds, Goldman Sachs, Merrill Lynch, Morgan Stanley, and Farallon Capital are the majority shareholders in Indiabulls. Indiabulls stepped into the real estate market as Indiabulls Real Estate Limited (IREL) in 2005. A joint venture between Indiabulls and a US based investment major Farallon Capital Management LLC resulted in bringing FDI (Foreign Direct Investment) for the first time in the Indian Real Estate Market. Another joint venture amongst Indiabulls and DLF, Kenneth Builders and Developers (KBD), has brought up projects for development of residential apartments. The products and services offered include securities, credit services, Demat account for share trading, fast loans, moneycontrol services, mutual fund news, commodity and realty retail and review along with technical analysis of the market. Indiabulls offers you the updated, reliable and factual research-based analysis

of the stock market as equity research forms. These help you in deciding which stock or share to invest in. India bulls also provide commodity brokerage services under Indiabulls commodities private limited (ICPL). It deals in research work and formation of reports on agri-commodites and metals. ICPL has one of the largest retail branch networks in the country. The security offering at Indiabulls include equity research, commodities, Internet trading and online IPO (Initial Public Offer). Indiabulls Consumer Finance Services cover personal loans, auto loan, commercial vehicle loans and mortgage services include home loans and loans against property. Internet trading facility is also available on the Indiabulls website. Also get online corporate news and market reports along with the major gainers and losers and top traded shares in Nifty and Sensex. The careers at Indiabulls include finance, technical; security and customer care profiles as the most sought after jobs. Any career opportunity with Indiabulls is declared on the official website of the company. India bulls.com also provides info on the annual reports of the company, its history and current profile. You can login to your online trading account and get info on the market news and also the brokerage charges and rates.

PROCEDURE FOR A LOAN

On the one hand, there is less paperwork, since the bank does not have to verify any asset as in the case of home loans. On the other hand, there are stringent income criteria to qualify for personal loans. But once you make the grade it takes only about three days for you to get a personal loan -a lot less time than a home or car loan. A step-by-step break-up of the personal loan application process: Step 1: Enquiry with a financier: The first step is to get in touch with a lender. How do you know whom you should approach? You need to get in touch with as many lenders as possible and get them to make loan offers to you. Then negotiate with them to get the best interest rate. Check if there are any special offers. After you have got all the banks to make their offers to you, select your lender based on the information you have in front of you. Step 2: Documents Collection After you finalise your lender, the lender's direct selling agent will visit you and collect documents supporting proof of income, residence proof, and identity. You may be required to produce copies of IT returns, salary slips, bank statements, ration card, passport, driving licence, and other relevant documents. These requirements vary from lender to lender.

Step 3: Field Investigation Agency Representative Visit After submitting the documents, a field investigator will visit your home to double check the facts provided in the documents, such as your place of residence, tenure at work place and so on. It is essential that you are present during this visit; otherwise the investigator could report that the facts you provided do not actually add up, thus forcing the lender to reject your loan application. Step 4: Loan approved Once the lender is satisfied with the veracity of your documents, the loan is approved. The lender then disburses the amount through cheques or demand drafts (DD).

Personal loan eligibility: Qualifying criteria Personal loans, or all purpose loans as they are referred to, are offered by many institutions like ABN Amro Associates, Citibank, HDFC Bank, ICICI Bank, Kotak Mahindra Bank, Standard Chartered, and all major banks in India.

The eligibility criteria for a personal loan are often more stringent than those applied for other categories of loans. This is because the financier views these loans as riskier than any other loan. They are, after all, loans offered with no strings attached.

The eligibility criteria differ from one institution to another. This is because the perception of risk differs. However, here are the criteria applied / documents required in most cases:

1. A copy of your passport or driving license or voters ID or PAN card or photo credit card or employee ID card (in case you are employed with a government owned company) as identity proof and signature proof. 2. A copy of your passport, or ration card, or utility bill, or voters ID, or LIC policy receipt as residence proof. 3. The proof of income to be submitted by salaried individuals differs from that of self-employed individuals. Salaried people need to submit their latest salary slip, Form 16 for the last year and their bank statement for the last 6 months. Self-employed people need to provide their IT returns for the last 2 years with balance sheet and profit & loss account as a proof of income.

Documentation Compared to other types of loans, personal loans require you to produce the least number of documents. The necessary documents required can be classified into three: documents supporting your identity, your residence and your income.

Identity Proof: A copy of any of your passport or driving license, voters ID, PAN card, credit card with photograph, or employee ID card with photograph. Any one of the above documents with your photograph is proof that you are the same person as you profess to be. Proof of Residence: A copy of your passport, ration card, or voters ID if you reside at the same place as entered in the above-mentioned documents. If you are staying as a tenant on rent, in a place different from where you have been issued the ration card, passport, or voters ID, you can produce utility bills (electricity or telephone) of the place as proof of residence. Income Proof: The proof of income for salaried individuals differs from that of selfemployed individuals. Salaried people need to submit their latest salary slip, Form 16 for the last financial year, and their bank statement for the last 6 months. Self-employed people need to provide their IT returns for the last 2 years, balance sheet, and profit & loss account as proof of income.

Charges applicable before and after the personal loan Very often we fail to read the fine print in a loan document. The real cost of your personal loan is visible only when you factor in numerous other charges levied. If you intend to make comparisons with other types of loans, it is

necessary to take into account these charges to arrive at the real cost. For example, the processing fee or prepayment fee in the case of a personal loan will be different from that of a loan against property. Here is a list of all charges that are levied either before the loan is disbursed or through the course of the loan or when you terminate the loan: Description of Charges:

Processing fee Prepayment fee Charges for late payment (loans) Cheque bounce charges Duplicate statements charges Documentation charges

Service tax Processing fee: Processing fee is the amount charged by banks to cover the cost of processing your loan application. Processing fees vary from one bank to another. Some banks ask you to pay the processing fee upfront even before the loan is sanctioned. This is often charged when you submit your loan application along with the supporting documents. The processing fee is generally a percentage of the loan amount and is between 1-2% for personal loans. Some banks levy a flat charge of Rs 1000

or Rs 2000 upfront, and then deduct the balance processing fee (if any) from the loan amount before disbursal. The processing fee is non-refundable. Some banks say the processing fee will be refunded if the loan is not sanctioned. It is recommended that you take this in writing from the bank as technically, processing fee is non-refundable. Pre-payment fee: The pre-payment fee is the penalty paid by the borrower for foreclosing the loan before the actual tenure. Pre-payment fees are levied as a percentage of the outstanding principal of the loan amount. The prepayment fee varies from bank to bank. It varies from 2% to 5% of the outstanding loan amount, if the repayment amount exceeds 25 per cent of the outstanding loan amount. Charges for late payment: When the monthly installment (EMI) towards repayment of a loan is delayed the bank collects the installment along with late payment charges. The late payment charge is also known as the delayed payment charges or the overdue payment charges. Late payment charges are fixed at the time of signing the loan contract. This is chargeable if you make the payment after the due date. Late payment fees range from 2% to 3% per cent of the EMI. Cheque Bounce Charges: Cheque bounces mean that a cheque has been presented for clearance, but the amount written on the check exceeds the available balance in the account. It

is often colloquially referred to as a bounced cheque. Businesses frequently use the term dishonoured cheque. If you have given post-dated cheques to the bank to debit the EMI from your account, ensure that you have sufficient funds in your account every month. If a single cheque bounces, the bank charges anything from Rs 250 to Rs 500 as penalties. Duplicate Statements Charges: When the loan is sanctioned, the lender gives you a statement detailing the repayment schedule. If you lose it, you can request the bank to issue a duplicate statement. The statement indicates your balance loan amount and the remaining EMIs. Banks charge anywhere between Rs 100 to Rs 500 for issuing duplicate statements. Documentation charges: Banks levy documentation charges towards the verification of the various documents you provide towards the loan application. Many banks employ third-party vendors to do the document verification. The expense on this account is usually passed on t the customer, which range from Rs 500 or Rs 1000. Service tax: Service tax is a tax levied on service providers who have annual revenue of more than 8 lakh. Banks loans too fall under the purview of service tax. Service tax is charged at the rate of 12.36% on the interest and any other charges like processing fee levied by the lender.

COMPUTERIZED SYSTEM
A system function is an activity or process. The proposed system is composed of the following components: Input: The loan department keeps detail information about loan. So the key input for the proposed system will be Loan number, Project information (Id, Name, Branch), Sanction amount, Disbursement information (Amount, Date), Cycle code, Interest amount, Repayment information (Amount, Date), Receive information (Amount, Date), Re-phased information (Old loan no, New Loan no, Debit amount, Credit Amount) etc. Which comes from the user. Processing: After collecting data, they classify those data into separate files for each Loan. There are lots of calculations for every single transaction. If a transaction occur than they maintain the balance by debiting and crediting. They also perform calculation of sanction amount, receive amount etc and keep this information in day-to-day basis report and also create monthly and yearly reports. Output: Loan Department produces different types of daily, monthly, quarterly and yearly branch wise reports about How much money is given as loan, How much money will be received, how much money is received and how much money is left etc. Storage: The system that I have designed is for network environment. So many user can use this application but the data storage will in the server pc only. The server pc will contain the database and the user will use their own password to enter the database from their pc for storing data.

Control: In their information system they try their best to keep accurate data to

maintain their standard and level. Also they provide a facility of data security and changing of data. They always verify the projects information. Like they check whether the address or contact no of project is correct or valid. They also verify the transaction. They confirm that all the Balances are figured out accurately. They also ensured that information saved in files is kept consistent by some special naming system. They also make sure that important files are kept in a secured place. Not Due Loan Ledger This ledger book keeps most of the information of Not Due section. The project name, address, loan no, Amount sanctioned, Repayment schedule information, Disbursed information all are recorded in this ledger book. This section maintains one ledger book for one branch. Same kind of ledger book is used for foreign currency and Taka loan. Over Due Ledger Card This ledger Card is used in Over Due Section. All kinds of payreceived information are recorded in this ledger card like- Principal receive, Other charge receive, Interest on loan balance, Value date, Transaction date etc. Section Summery Repot: This is a computerized report, which shows the sections wise balance of amount due. They produce it using Ms. Excel. Balance Conformation Certificates: This is an annual conformation, which is send to the client. It contains both not due and over due balance of closing date. Currency Disbursement Report:

Its shows Branch wise Local Currency Disbursement. Ms. Excel is used to generate this report.

ADVANTAGES

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Providing security to the loan information data. Minimizing the large documentation. Making calculations easy. Easy maintains of Data Reducing the extra manpower and overhead work.

CONSTRAINS

There are some constraint on this project, those are:

As the current system is completely manual, making it automated need lot of time by realizing the existing system. The time limitation is one of the greatest problems in this regard.

The system will process lots of transaction. So the calculation part must be reliable as much as possible. In this organization, there are so many senior employee, who are not familiar with computerized system and they are not interested to develop a computerized system. Most of the employee does not have good knowledge about computer. Thats why some of there expectations are unrealistic. Its a government organization. So most of the information is scattered.

CONCLUSION
Keeping and analyzing inventory records are essential to the efficient management of a business. Accurate inventory management and resulting analyses help enterpreneurs make financial and production decisions.

Traditional manual record-keeping systems continue to work well for small companies. Computerized record-keeping and analysis programs have been accepted and used by a number of companmies. Developing and using a computerised record-keeping system will allow the firm manager to make more informed decisions affecting the profitability of the firm.