PROJECT REPORT ON

A study of home loan scheme of LIC Housing Finance

Submitted to
University of Mumbai
In Partial Fulfilment of the Requirement
For
M.Com (Accountancy) Semester III
In the subject
Research Methodology
By
Name of the student : - Yash Karkhanis
Roll No. : 15 -9669

Name and address of the college

K. V. Pendharkar College
Of Arts, Science & Commerce
Dombivli (E), 421203

NOVEMBER 2015

DECLARATION
I YASH MILIND KARKHANIS Roll No. 15 9669, the student of M.Com
(Accountancy) Semester III (2015), K. V. Pendharkar College, Dombivli,
Affiliated to University of Mumbai, hereby declare that the project for the
subject Strategic Management of Project report on A study of home loan
scheme of LIC Housing Finance submitted by me to University of Mumbai,
for semester III examination is based on actual work carried by me.
I further state that this work is original and not submitted anywhere else for any
examination.

Place : Dombivli
Date:

Signature of the Student

Name: - Yash Milind Karkhanis

Roll No: - 15 -9669

ACKNOWLEDGEMENT
It is a pleasure to thank all those who made this project work possible.
I Thank the Almighty God for his blessings in completing this task.
The successful completion of this project is possible only due to
support and cooperation of my teachers, relatives, friends and wellwishers. I would like to extend my sincere gratitude to all of them.
I am highly indebted to Principal A.K.Ranade, Co-ordinater
P.V.Limaye, and my subject teacher Mr. Prashant Naik for their
encouragement, guidance and support.
I also take this opportunity to express sense of gratitude to my parents
for their support and co-operation in completing this project.
Finally I would express my gratitude to all those who directly and
indirectly helped me in completing this project.

Name of the student

Yash Milind Karkhanis

Table of Contents
CHAPTER:1.......................................................................................................... 5
OBJECTIVE OF STUDY.......................................................................................... 5
RESEARCH DESIGN............................................................................................. 6
LIMITATIONS OF STUDY....................................................................................... 7
SIGNIFICANCE OF STUDY.................................................................................... 7
INTRODUCTION................................................................................................... 8
CHAPTER:2.......................................................................................................... 9
REVIEW OF LITERATURE...................................................................................... 9
INTRODUCTION OF LICHFL.................................................................................. 9
ADVANTAGES OF LICHFL...................................................................................15
SWOT ANALYSIS................................................................................................ 18
Strengths:......................................................................................................... 18
HOME LOANS SCHEMES OFFERED BY LIC HOUSING FINANCE:..........................19
OTHER LOAN SCHMES OF LIC HOUSING FINANCE:............................................25
CORPORATE...................................................................................................... 25
CHAPTER:3........................................................................................................ 29
OBSERVATIONS................................................................................................. 29
CHAPTER:4........................................................................................................ 30
SUGGESTIONS:................................................................................................. 30
BIBLIOGRAPHY.................................................................................................. 31

CHAPTER:1

OBJECTIVE OF STUDY

To study the various home loan schemes of LIC Housing Finance.

To study the SWOT analysis of LIC Housing Finance
To study the advantages of LIC Housing Finance
To know other schemes provided by LIC Housing Finance

RESEARCH DESIGN
A descriptive study tries to discover answers to the questions who, what, when, where, and,
sometimes, how. The researcher attempts to describe or define a subject, often by creating a
profile of a group of problems, people, or events.

Research methods are the various procedures, schemes and algorithms used in research. All
the methods used by a researcher during a research study are termed as research methods.
They are essentially planned, scientific and value-neutral. They include theoretical
procedures, experimental studies, numerical schemes, statistical approaches, etc. Research
methods help us collect samples, data and find a solution to a problem. Particularly, scientific
research methods call for explanations based on collected facts, measurements and
observations and not on reasoning alone. They accept only those explanations which can be
verified by experiments.
Research methodology is a systematic way to solve a problem. It is a science of studying
how research is to be carried out. Essentially, the procedures by which researchers go about
their work of describing, explaining and predicting phenomena are called research
methodology. It is also defined as the study of methods by which knowledge is gained. Its
aim is to give the work plan of research.

During this research Descriptive and Exploratory approach is taken into consideration
because of the availability of relevant information to study the various home loan schemes of
LIC housing Finance and to know about the companys profile.

TYPE OF DATA USED:

SECONDARY DATA:
Secondary data is one which already exists and is collected from the published sources. The
sources from which secondary data was collected are:
Books
Internet.

LIMITATIONS OF STUDY
Although the study was carried out with extreme enthusiasm and careful planning there are
several limitations, which handicapped the research viz,
Time Constraints:

The time stipulated for the project to be completed is less and thus there are chances that
some information might have been left out, however due care is taken to include all the
relevant information needed.
Accuracy:
It is difficult to tell that all the information collected is accurate enough as the information
was taken from various sources.

SIGNIFICANCE OF STUDY
The deeper the company understands of consumers needs and satisfaction, the earlier
the product or service is introduced ahead of competition, the greater the expected
contribution margin. Hence the study is very important.

This study will help companies to customize the service and product, according to the
consumers need

INTRODUCTION
What is Research? It is an investigation of finding solutions to scientific and social
problems through objective and systematic analysis. It is a search for knowledge, that is, a
discovery of hidden truths. Here knowledge means information about matters. The
information might be collected from different sources like experience, human beings,
books, journals, nature, etc. A research can lead to new contributions to the existing
knowledge. Only through research is it possible to make progress in a field. Research is

indeed civilization and determines the economic, social and political development of a
nation. The results of scientific research very often force a change in the philosophical view
of problems which extend far beyond the restricted domain of science itself. Research is not
confined to science and technology only. There are vast areas of research in other
disciplines such as languages, literature, history and sociology. Whatever might be the
subject, research has to be an active, diligent and systematic process of inquiry in order to
discover, interpret or revise facts, events, behaviours and theories. Applying the outcome of
research for the refinement of knowledge in other subjects, or in enhancing the quality of
human life also becomes a kind of research and development. Research is done with the
help of study, experiment, observation, analysis, comparison and reasoning. Research is in
fact ubiquitous

The process used to collect information and data for the purpose of making business
decisions. The methodology may include publication research, interviews, surveys and
other research techniques and could include both present and historical information.

CHAPTER:2

REVIEW OF LITERATURE
INTRODUCTION OF LICHFL

LIC Housing Finance Limited (LIC HFL) is one of the largest Housing Finance company
in India having its Registered and Corporate office at Mumbai. The main objective of the
Company is providing long term finance to individuals for purchase or construction of
house or flat for residential purpose / repair and renovation of existing flat / houses. The
Company also provides finance on existing property for business / personal needs and also
gives loans to professionals for purchase / construction of Clinics / Nursing Homes /
Diagnostic Centres / Office Space and also for purchase of equipments. The Company also
provides long term finance to persons engaged in the business of construction of houses or
flats for residential purpose and to be sold by them. Today the Company has a proud group
of over 15.56 LACS prudent house owners who have enjoyed the Company's financial
assistance.
LIC Housing Finance Ltd. is one of the largest Housing Finance company in India.
Incorporated on 19th June, 1989 under the Companies Act, 1956, the Company was
promoted by LIC of India and went public in the year 1994. The Company launched its
maiden GDR issue in 2004. The Authorized Capital of the Company is Rs.1500 Million
(Rs.150 Crores) and its paid up Capital is Rs.1009.9 Million ( Rs.100.99 Crores). The
Company is registered with National Housing Bank and listed on the National Stock
Exchange (NSE) & Bombay Stock Exchange Limited (BSE) and its shares are traded only
in Demat format. The GDR's are listed on the Luxembourg Stock Exchange. The Company
possesses one of the industry's most extensive marketing network in India

SUBSIDIARY COMPANIES:
1. LICHFL Care Homes Limited
To address the crying need of housing for the senior citizens of the country, the Company
had promoted LICHFL Care Homes Limited, to establish and operate assisted community
living centres. LICHFL Care Homes Limited was incorporate on 11th September, 2001. It
launched its eco-friendly pilot project in Bangalore with cost-effective independent cottages
and all other on-campus amenities, fully structured and self-contained to address every
possible need of residents. It has library, community centre, home theatre, meditation
centre, and doctors on call and ambulance to take the ailing to the nearest city Medicare
centre-all that would make the lives of senior citizens comfortable and satisfying. New such
projects are planned in Bhubaneshwar and Jaipur and the company is in the process of
finalising the purchase of land for a few more projects
2. LICHFL Financial Services Limited
LICHFL Financial Services Limited was incorporated on 31st October, 2007 for
undertaking non fund based activities like marketing of housing loans, insurance products,
credit card, mutual fund, personal loan etc. It has become operational in 2008-09 and has
already opened five offices in Maharashtra and plans to open atleast another thirty offices

during 2009-10.

3. LICHFL Trustee Company Private Limited

LICHFL Trustee Company Private Limited was incorporated on 5th March, 2008 for
undertaking the business of trustees of venture capital trust, funds-in India and offshore
fund. The Company would very soon launch its operations - act as trustee of the fund raised
through private placement, public offer etc.
4. LICHFL Asset Management Company Private Limited
LICHFL Asset Management Company Private Limited was incorporated on 14th February,
2008for undertaking the business of managing, advising, administering venture funds, unit
trust, investment trust in India as well as abroad. The Company would launch its operations
very soon.

Vision
To be the best Housing Finance Company in the country.
Mission
Provide secured housing finance at affordable cost, maximizing shareholders value with
higher customer sensitivity.
Values
Fair and Transparent Business Practices.
Transformation to a Knowledge Organisation.
Higher Autonomy in Operations.
Instilling a sense of Ownership amongst Employees

Reasons for Home Loans:

To own a home is everyone's dream. From a single room to multi-storeyed apartments,
private villas, holiday homes, second homes - the Housing market is well developed in most
towns.
Home loans help you realize your own home dream, even when you are young. We help
you plan your dream home as you start your working life, by offering various options of
easy installments, Income Tax benefits and more . . .
Loans: Loans are offered as per different target groups of consumers. Thus, there are lic
housing finance schemes offered as loans according to different borrower-category, such as:
i)

Corporate loans

ii)

Loans meant specifically for builders as well as real estate developers

iii) Home-loans
iv) Loans aimed at professionals

Deposit schemes: Deposit schemes were first launched by the company on 10th May 2007
and may be accepted as both cumulative as well as non-cumulative deposit schemes. Terms
of deposit may range from 1 year; 18 months; 2 years; 3 years as well as 5 years.
Interest under non-cumulative deposit schemes would be distributed twice a year; whereas
interest on cumulative deposit schemes would be calculated as per bi-annually
compounding.
Loans:Housing Finance By LIC :
Loan-schemes available with lic housing finance are customized to suit varied requirements
as per individual borrower-profile. As per official website and lichousing finance news
following loans are available:
Home loans: Are offered at easy rates to both residents as well as non-resident Indians.
Step-up facility in terms of amount of EMI amount is also available for those who wish to
opt for a steady increase in their repayment capacity during tenure if loan.
Corporate loans: Aimed at corporate employees who have been approved by LIC and

include employees of PSUs, reputed public as well as private limited companies

Housing finance by LIC loans to professionals: Aimed at non-salaried professionals.

LICHFL is the best choice because:

LIC HOUSING FINANCE LIMITED is one of the largest Housing Finance providers in
India, which has provided finance for almost 9,50,000 houses in the country.

LICHFL is a single-product company with its core business being Home Loans, and has
about

two decades of experience and in-depth knowledge of

the real estate market

dynamics.

LICHFL provides:
Lowest Interest Rates
Easy application, quick approvals.
Largest Network.
No Hidden Costs.
The Company has been rated as FAAA/Stable by CRISIL.

PROPERTY SERVICE DIVISION

Property Service Division is a new division which was introduced two years back in LIC
HFL. Property services division, which offers investors and builders a single transparent
platform to buy/sell office and commercial spaces and residential apartments/flats.
A new line of business by the name Property services Division is being launched across the
country in selected centres. The function of the Property services Division includes all
activities involved in enabling a prospective homebuyer select the property up to taking the
possession of the same. It is thus conceived to be a one-stop-shop for all the advisory

services related to the above.

Types of services that a PSD can provide:

Since each state's laws may differ from others, it is generally advised that prospective
sellers or buyers consult a licensed real estate professional.
Some Examples:
Comparative Market Analysis (CMA) an estimate of the home's value compared with
others. This differs from an appraisal in that property currently for sale may be taken into
consideration (competition for the subject property).
Exposure Marketing the real property to prospective buyers.
Facilitating a Purchase guiding a buyer through the process.
Facilitating a Sale guiding a seller through the selling process.
FSBO document preparation preparing necessary paperwork for "For Sale By Owner"
sellers.
Full Residential Appraisal but only, in most states, if the broker is also licensed as an
appraiser.
Home Selling Kits

guides to how to market and sell a property.

Hourly Consulting for a fee, based on the client's needs.
Leasing for a fee or percentage of the gross lease value.
Property Management.
Exchanging property.
Auctioning property.
Preparing contracts and leases. (Not in all states.)

These services are also changing as a variety of real estate trends transform the industry.

TIPS TO CUSTOMERS REGARDING HOME LOAN:

Home Loan
After spending time and effort to research and find your dream home, selection of a Home
Loan company and the loan product should not be a hasty decision.
The main issues besides the rate of interest offered, would be the companys loan procedure,
product range, quality of services offered and safe retrieval of the Title Deed of the property
deposited as a security for the housing loan, on completion of the loan tenure.
You should also be aware of how you can enhance your loan eligibility without the burden
of a higher EMI. LICHFL offers flexibility to customers, enhances their loan eligibility,
helps them optimize tax benefits and customize EMIs according to their repayment
capacity, so the customer is able to repay the loan comfortably.

Further, when you take a home loan you enter into a long-term financial commitment, as
home loans are long-term loans where the commitment is for a period of 15 to 20 years. In
case of any unforeseen event during this period, it is better to make sure that your family is
not burdened with the loan liability. Hence, to take care of uncertainties during such a long
period, it is better to take a Home Loan Insurance.

And finally, it is best to go with companies that have established themselves over the years,
as they are more flexible and will be able to offer you customized services. The other
advantage is this will also help you to encash on the vast pool of knowledge that comes with
their experience.

Reasons to buy from LICHFL?

They operate in the Financial Services industry with us as the centre of focus. They provide
complete, holistic financial solutions to meet all our financial needs. They ensure welltrained, professional financial planners at your service, as well as provide us with personal

finance education and money management tools, to help us make the right decisions for our
secure future.

ADVANTAGES OF LICHFL
Organized, Integrated and Professional Approach.

Strong Brand - Synonymous with Transparency, Trust and Credibility.

Experience in the field of real estate and financing.

Vast Network of Agency Force and Branch Network.

Large pool of experienced staff.

Additional in-house facility & expertise to provide home finance to customers.

Reliable advice as per requirements and budget of customer at the best terms and
price.

Highly experienced team of Over 773 Direct Sales Agent (DSAs),3400 Home Loan
Agents (HLAs) and 615 Customer Relationship Associates.

Existing network & relationship with service providers.

In-house facility to provide home finance.

Expertise in Legal and Technical Scrutiny of Property

Relationship with leading Developers across the country.

Thorough understanding of processes.

Punchline - "Are you sure that you will get the desired loan, after you have booked the
property? Now, book your property through LIC HFL Property Services and have peace of
mind." All services - from booking of property till possession; under one roof. Fair and
transparent deal.

Reasons for Choosing LICHFL PSD Home Search Facility:

Employ a comprehensive database of builders, development projects and available real
estate to identify properties that will meet your individual requirements.

Regularly update our database to ensure that you are constantly filled in real estate
opportunities.

In depth cognizance of various builders & real estate projects empowers us to fine tune
your search. We work within the budget and area specified by you.

Offer unbiased advice.

Offer special schemes and attractive rates, help you negotiate the best price and advise
you on payment schedules.

Assist to get the best deals on Home Loans.

LICHFL-A one-Stop Shop for services

Assistance in analyzing the requirements.

Selection of property at reasonable/ affordable price.( for Individual/ Group)

Completing the Transaction.
Guiding for Best Home Loan and assistance in providing loan.
Help in arranging Legal and Technical Services.

Help in Selection of Professionals/ material/ interior.

Help in taking Possession.
Help in letting out the property.

Services Offered:

Select the property of your choice.

Obtain a home loan from the lender of your choice.

Assistance in completing the documentation and legal formalities.

Monitoring the stage of construction and advising the customer in making

installment payments.

Assistance in selection of professionals/sourcing of materials for interiors.

Possession/housewarming of the property.

Letting out the property on rent.

SWOT ANALYSIS
LIC Housing Finance Limited (LIC Housing Finance) is an Indian based housing finance company.
The company provides loans for construction, repairs, purchase and renovation of houses and flats
to co-operative housing societies, corporate bodies, builders and individuals. The company also
provides asset management services, venture fund and financial services through its six subsidiary
companies. The company operates through a network of six regional offices, 13 back offices and
157 marketing units as well as through pan-India marketing that includes a network of 4,865 home
loan agents, 934 direct sales agents and 485 customer relationship associates.
Swot analysis of LIC HOUSING FIN.LTD
Strengths:
1) Brand Image
2) Govt .Guarantee
3) Claims settlement
4) Pan India presence
5) Large product portfolio.

Weakness :
1) Lethargic Staff
2) Mediocre Top Bosses
3) Large scale Corruption in Main Office
4) Ultra-Slow decision making process
5) Internal problems between Top Management and lower care Employees.
Opportunities:
1) Pension Market
2) Health Insurance
3) Large Real Estate portfolio
FUTURE PLANNING OF LIC HOUSING LTD. LICHFL is expected to reveal the detailed concept
and agenda of the HOMES FOR ALL EXPO at the builders meet. The company officials will also
interact with various participants and deliberate upon the ways and means to showcase their offers to
their target audience more effectively and attract the buyers. The main objective of the company is
providing long term finance to individuals for purchase/ construction /repair and renovation of new/
existing flats/ houses.The company also provides finance on existing property for business/ personal
needs and gives loans to professionals for purchase /nursing homes office space and also for
purchase of equipments
FUTURE ACQUASITION The housing sector is marked by a variety of taxes and regulations.
These are meant to ensure the safety of houses for occupation and to confer rights of ownership to
enable further transactions. Given that building or acquisition of a house usually involves several
intermediary agents (either statutory like registration of various title documents or facilitating agents
such as brokers, builders or financiers), the final cost of acquisition includes not just the price of the
property that is paid to the seller (in case the property is purchased) but also all the intervening
transaction costs
FUTURE PLAN LIC Fund about 300-350 Croce it would be invested real estate projects. LIC
HOUSING looking to opening office at Singapore. Housing for senior citizens. Widen distribution
channels and diversify assets. Maintain low cost operating structure.

HOME LOANS SCHEMES OFFERED BY LIC HOUSING FINANCE:

As per various LIC Housing Finance news, there are many products that are offered by the
company ever since it was launched way back in the year 1989. These include both deposits
as well as advance schemes that work as tools of housing finance by LIC:

A) RESIDENT
1. Purchase
Loan Amount

: Min.Rs.1,00,000/-

Loan
cost

: 85% of total cost of the property including Stamp Duty &

Registration Charges for loan up to 20 Lacs 80% of total cost
of the property including Stamp Duty & Registration Charges

to

Property

for loan above 20 Lacs and up to 75 Lacs 75% of total cost of

the property including Stamp Duty & Registration Charges for
loan upabove 75 Lacs .
Loan Term

: Maximum term - For Salaried - 30 years, for self employed 20

Years

Repayment Mode

: Equated Monthly Installments (EMI)- Monthly Rest Basis

Rate of Interest

: Contact nearest Office for details on the Prevailing Interest

Rates

Upfront fees

: As applicable from time to time

2. Construction

Loan Amount

: Min.Rs.1,00,000/-

Loan
cost

: 85% of total cost of the property including Stamp Duty &

Registration Charges for loan up to 20 Lacs 80% of total cost
of the property including Stamp Duty & Registration Charges
for loan above20 Lacs and up to 75 Lacs 75% of total cost of
the property including Stamp Duty & Registration Charges for
loan above 75 Lacs

to

Property

Loan Term

: Maximum term - For Salaried - 30 years, for self employed 20

Years

Repayment Mode

: Equated Monthly Installments (EMI) - Monthly Rest Basis

Rate of Interest

: Contact nearest Office for details on the Prevailing Interest

Rates

Upfront fees

: As applicable from time to time

3. Extension

Loan Amount

Min.Rs.1,00,000/-

Loan to Property cost

85% of total cost of the property including Stamp Duty &

Registration Charges for loan up to 20 Lacs 80% of total
cost of the property including Stamp Duty & Registration
Charges for loan above20 Lacs and up to 75 Lacs 75% of
total cost of the property including Stamp Duty &

Registration Charges for loan above 75 Lacs

Loan Term

: Maximum term - For Salaried - 30 years, for self

employed 20 Years

Repayment Mode

Equated Monthly Installments (EMI) - Monthly Rest

Basis

Rate of Interest

Contact nearest Office for details on the Prevailing

Interest Rates

Upfront fees

As applicable from time to time

4. Repairs/Renovation

Loan Amount

: Min.Rs.1,00,000/-

Loan
cost

: 85% of cost of the estimate for loan up to 20 Lacs 80% of cost

of the estimate for loan above 20 Lacs and up to 75 Lacs 75%
of total cost of the estimate forloan above 75 Lac

to

Property

Loan Term

: Maximum term - For Salaried - 30 years, for self employed 20 Years

Repayment Mode

: Equated Monthly Installments (EMI)- Monthly Rest Basis

Rate of Interest

: Contact nearest Office for details on the Prevailing Interest

Rates

Upfront fees

: As applicable from time to time

5. Plot Purchase

Purpose
Loan
cost

to

: Loan for purchase of residential plotfrom statutory authorities

Property

75% of the property value

Loan Term

: Maximum term - 15 Years

Repayment Mode

: Equated Monthly Installments (EMI) - Monthly Rest Basis

Rate of Interest

: Contact nearest Office for details on the Prevailing Interest

Rates

Upfront fees

: As applicable from time to time

6. Take over from other Institutions/Banks + Top up

Purpose

: Takeover of existing loan from other Financial Institution/Banks

Term

: Maximum 30 Years for Salaried and Maximum 20 Years for

Business

Loan Term

: Contact nearest Office for details on the Prevailing Interest Rates

Upfront fees

: As applicable from time to time

B) NON-RESIDENT

1. Purchase

This scheme is available only for Salaried persons having NRI/PIO status.
Loan Amount

: Min.Rs.1,00,000/-

Loan
cost

: 85% of total cost of the property including Stamp Duty &

Registration Charges for loan up to 20 Lacs 80% of total cost
of the property including Stamp Duty & Registration Charges
for loan above20 Lacs and up to 75 Lacs 75% of total cost of
the property including Stamp Duty & Registration Charges for
loan upabove 75 Lacs .

to

Property

Loan Term

: Maximum term - For Persons with Professional Qualification 15 years, for Others 10Years

Repayment Mode

: Equated Monthly Installments (EMI)- Monthly Rest Basis

Rate of Interest

: Contact nearest Office for details on the Prevailing Interest

Rates

Upfront fees

: As applicable from time to time

2. Construction

This scheme is available only for Salaried persons having NRI/PIO status.
Loan Amount

: Min.Rs.1,00,000/-

Loan
cost

: 85% of total cost of the property including Stamp Duty &

Registration Charges for loan up to 20 Lacs 80% of total cost
of the property including Stamp Duty & Registration Charges
for loan above20 Lacs and up to 75 Lacs 75% of total cost of
the property including Stamp Duty & Registration Charges for
loan above 75 Lacs

to

Property

Loan Term

: Maximum term - For Persons with Professional Qualification 15 years, for Others 10Years

Repayment Mode

: Equated Monthly Installments (EMI) - Monthly Rest Basis

Rate of Interest

: Contact nearest Office for details on the Prevailing Interest

Rates

Upfront fees

: As applicable from time to time

3. Extension

This scheme is available only for Salaried persons having NRI/PIO status.
Loan Amount

: Min.Rs.1,00,000/-

Loan
cost

: 85% of total cost of the property including Stamp Duty &

Registration Charges for loan up to 20 Lacs 80% of total cost
of the property including Stamp Duty & Registration Charges
for loan above20 Lacs and up to 75 Lacs 75% of total cost of
the property including Stamp Duty & Registration Charges for
loan above 75 Lacs

to

Property

Loan Term

: Maximum term - For Persons with Professional Qualification 15 years, for Others 10Years

Repayment Mode

: Equated Monthly Installments (EMI) - Monthly Rest Basis

Rate of Interest

: Contact nearest Office for details on the Prevailing Interest

Rates

Upfront fees

: As applicable from time to time

4. Repairs/Renovation

This scheme is available only for Salaried persons having NRI/PIO status.
Loan Amount

: Min.Rs.1,00,000/-

Loan
cost

: 85% of total cost of the estimate for loan up to 20 Lacs 80% of

total cost of the estimate for loan above 20 Lacs and up to 75
Lacs 75% of total cost of the estimate for loan above 75 Lacs

to

Property

Loan Term

: Maximum term - For Persons with Professional Qualification 15 years, for Others 10Years

Repayment Mode

: Equated Monthly Installments (EMI)- Monthly Rest Basis

Rate of Interest

: Contact nearest Office for details on the Prevailing Interest

Rates

Upfront fees

: As applicable from time to time

5. Plot Purchase

This scheme is available only for Salaried persons having NRI/PIO status.
Loan Amount

: Min.Rs.1,00,000/-

Purpose

: : Loan for purchase of residential plot by statutory authorities

Loan
cost

to

Property

75% of the property value

Loan Term

: Maximum term - For Persons with Professional Qualification 15 years, for Others 10Years

Repayment Mode

: Equated Monthly Installments (EMI) - Monthly Rest Basis

Rate of Interest

: Contact nearest Office for details on the Prevailing Interest

Rates

Upfront fees

: As applicable from time to time

C) PENSIONERS
1. Before Retirement

Purposes

: Loans under the scheme may be availed for purchase,

construction, extension of House / Flat

Eligibility

: Persons whose age is 50 or more and having a pension scheme

after retirement may apply for loan under this scheme.

Terms &
Conditions

: An undertaking letter that the entire loan oratleast 30 % or an

amount as decided by the Area Office will be repaid out of the
retirement benefits is required. The balance is to be repaid from
the Pension Income. The amount of Principal to be repaid at the
time of retirement will depend on the Pension amount the
applicant is eligible after retirement.

Loan Term

: The term of the loan will be up to 15 years or 70 years of age

whichever is earlier.

2. After Retirement

Purposes

: Loans under the scheme may be availed for purchase,

construction, extension of House / Flat.

Eligibility

: Pensioners having a stable income throughout their life from

pension may apply for loan under this scheme.

Terms &
Conditions

: 1) Commutation of Pension or any portion thereof is not

allowed
under
this
scheme.
2) A Guarantor acceptable to the Company is required.

Repayment Mode

: The loan is to be repaid before the applicant attains the age of

70 years.

OTHER LOAN SCHMES OF LIC HOUSING FINANCE:

CORPORATE
1. Staff Quarters

Purpose

: Construction/purchase of Staff Quarters.

Applicant

: Reputed Listed Public Limited or PSUs.

Repayment Mode

: Equated Monthly

Security

: Equitable Mortgage and any other security.

Rate of Interest

: Quoted on Application.

2. Line of Credit "To" Scheme

For the organizations having Housing Finance schemes for their employees, LIC HFL is
providing loans under Line of Credit scheme. The scheme is to make available Line of
Credit to the Borrower Organization to fund its Housing Finance scheme for employees

Mode of Advance

: On the basis of periodical statement of housing

loansanctioned to its employees. The Borrower company
shall disburse the loan to its employee within 15 days of
availing disbursement from LIC HFL

Security for the Loan

: 1) Deed of Guarantee by the Beneficiary employee to the

extent of the loan advanced to him by the employer
company
2) Equitable Mortgage of the individual units financed
under the LOC in the form of Deposit of title deeds to be
submitted to the borrower company on behalf of LIC
HFL

Repayment of the Loan

: Loan repayment will be made directly by the Borrowing

Company to LIC HFL.

3. Line of Credit "Through" Scheme

For an Organization where direct HBA facility is not available, the Line of Credit "Through" scheme will help the organization fulfill the needs of their employees for
availing the housing loan. Under this scheme, LIC HFL will make available funds to their
employees, as recommended by Company to enable employee-beneficiaries (borrowers)
to avail loan
Mode of Advance

: Linked to the construction

Security for the loan

: 1) Security of the mortgaged property

financed
2) Borrowers will have to execute
mortgage of their properties in favor of
LIC
HFL
3) Employee borrower will have to execute
a Loan Agreement which will have to be
countersigned
by
the
employer
guaranteeing
the
repayment
4) Guarantee from the employer for
repayment of entire loan with interest and
other dues, if any.

Repayment of Loan

: Through salary deduction

BUILDERS AND DEVELOPERS

1. Construction Finance Loan

Object

: Loans to Builders/Developers for developing and constructing

Residential / Commercial Premises.

Loan term

: Minimum-6
Maximum-5 years

Security & Title

: Mortgage of the land over which the building is proposed

along with super structure. Personal Guarantee of the Partners /
Promoters Corporate Guarantee (if required)

Disbursement
loan

of

Repayment of loan

Months

: Installments depending on the progress of work in the project,

its funding requirements and availability of sufficient security
cover.
: Through Escrow Account.

2. Term Loan

Object

: To Builders/Developers for business purpose.

Loan term

: Minimum - 6 Months
Maximum 3 years

Security & Title

: Mortgage of the Security of adequate Value acceptable to

LICHFL as may be deemed necessary. The Receivables from
various ongoing Projects to be assigned in favour of LICHFL.
Personal Guarantee of the Promoters of the Company. Any
other security as may be considered necessary by LICHFL

Disbursement of
loan

: In single tranche or in Installments based on the requirement of

the Applicant Company as agreed mutually.

Repayment of loan

: Through Escrow Account.

OTHER LOANS:
LOAN AGAINST PROPERTY (LAP):
Purpose

Loan against Mortgage of Residential House / Flat.

i) Childrens Education / Marriage
ii) Childrens Education / Marriage
iii) Purchase of another Property.
iv) Business Expansion.

Loan Amount

Min Rs.2,00,000/-

Loan Term

Maximum 15 years

Disbursement Of Loan

Equated Monthly Installments (EMI) - Monthly Rest

Basis.

Security

1. Equitable / Registered Mortgage of Residential

Property - Age of property not more than 35 years.
2. Demand Promissory Note.

Upfront Fees

1.00% of Loan Amount + Service Tax, as applicable.

This scheme is applicable to Resident Indians only.

LOANS TO PROFESSIONALS
Loans to Professional

Purpose

: Purchase/ Extension/ Modification / Renovation of

Commercial Premises for carrying on own Professional
Practice & Purchase of Equipments.

Eligibility

: Resident Indian Professionals. Loans can also be Sanctioned

to Company or Partnership firm of such Professional.

Loan Term

: 10 Years.

Repayment Mode

: Equated Monthly Installments (EMI) - Monthly Rest..

Security

: 1. Equitable/ Registered Mortgage of the Premise for which

the Loan is raised.
2. Demand Promissory Note.
3. Personal Guarantee of Directors / Partners, as Applicable.
4. In case of Companies, Registration of Charges in R.O.C.

Addl. Security

: Hypothecation of Equipment, if financed

Rate Of Interest

: Contact nearest Area Office for details on the Interest rate

LOAN AGAINST SECURTIY

1. Loans against Fixed Deposit of Nationalized Banks, Life Insurance Policies having
surrender value and Post office instruments like National Savings Certificates,
KisanVikasPatra

2. Loan up to 95% of face value of liquid security or surrender value in case of Life Insurance
Policies.

3. Minimum Loan Rs.50,000/-.

4. Maximum Term up to 20 Years

5. This loan can be clubbed along with Home Loans

CHAPTER:3

OBSERVATIONS
After overhauling the all situation that boosted a number of Pvt. Companies associated with
multinational in the home loan sector to give befitting competition to the established
behemoth LIC Housing Finance in public sector, we come at the observation that :

1) There is very tough competition among the private as well as other government loan
providing companies on the level of new trend of advertising to lull a major part of
Customers.

2) The entry of the Pvt. players in the home loan Sector has expanded the product segment to
meet the different level of the requirement of the customers. It has brought about greater
choice to the customers.

3) LIC Housing Finance has vast market and very firm grip on its traditional customers and
monopoly of home loan products.

4) LIC Housing Finance has customer friendly schemes for home loan.

5) There are no hidden costs.

CHAPTER:4
SUGGESTIONS:
In the modernized well advanced hi-tech approach to the customer every possible facilities
and effort to build up the confidence of the rising loan takers. Refinancing companies, to
complete one another nothing is left to suggest. But some suggestions that are intensely felt
and highly required for loaners to sustain in the market.

These are as follows:

a) More and more transparency should be ascertained between loaners and loanee.

b) Particularly, in the emerging boom in the refinance company, every refinance company
should be customer centred, and well versed in the handling of problem and grievances of
loan takers.

c) Each and Every product launched by LIC HFL should be in favour of increasing need of
loan takers.

BIBLIOGRAPHY
http://www.lichousing.com/index.php

https://en.wikipedia.org/wiki/LIC_Housing_Finance

http://www.mbaskool.com/brandguide/banking-and-financial-services/1019-lifeinsurance-corporation-of-india-lic.html