A

PROJECT REPORT

ON

“STUDY OF HOME LOAN”

AT

LIC HOUSING FINANCE LTD. AREA OFFICE PIMPRI

BY

Mr. YASHWANTRAO PANDURANG LAVATE

UNDER THE GUIDANCE OF

PROF. S. P. DINGRE

SUBMITTED TO

“SAVITRIBAI PHULE UNIVERSITY OF PUNE”

IN PARTIAL FULFILMENT OF THE REQUIREMENT FOR THE AWARD

OF THE DEGREE OF

MASTER OF BUSINESS ADMINISTRATION (MBA)

THROUGH

AUDYOGIK SHIKSHAN MANDAL’s

INSTITUTES OF BUSINESS MANAGEMENT & RESEARCH

(I.B.M.R),

CHINCHWAD, PUNE. 411019.

2013-2015

DECLARATION

I YASHWANTRAO PANDURANG LAVATE, a student of MBA (2013-2015)

hereby declare that the, project report entitled

“ ” STUDY OF HOME LOANS

is the authentic work done by me at

LIC HOUSING FINANCE LTD, PIMPRI, PUNE

Report is submitted in partial fulfillment of the requirement of the award of Master of

Business Administration (M.B.A.) degree abide by Savitribai Phule Pune University rules.

Yashwantrao Pandurang Lavate

MBA (Finance Management)

ASM’s IBMR Chinchwad, Pune.

ACKNOWLEDGEMENT

Devotion is important, knowledge is important, but this knowledge, devotion will be fruitless

if these factors are put in the wrong direction. So we desperately need a guide to make our

way clear in foggy situations. I have utilized this valuable suggestion in making my report

attractive and accurate. I am greatly indebted to all those, whose suggestion has formed the

bases of this report.

Firstly I would like to thank Mr. SHYAM GOWANE (Area Manager) LIC HOUSING

FINANCE LTD, PIMPRI, PUNE, for giving me the opportunity to work on this project.

Further, I extend my thanks to Mr. PANKAJ KORANE (Senior Associate) LIC

HOUSING FINANCE LTD, PIMPRI, PUNE, for being the source of inspiration and

guidance to me. It was their help and cooperation, which made me complete my project.

I am highly indebted to Ms. Sunita Sharma (Managing Director & Chief Executive

Officer) & Mr. S. K. Roy (Chairman) for his invaluable cooperation and his unending

support, for guiding me at every step.

Finally I would like thank to all respondent for their helpful criticism and useful suggestions,

which contributed towards successful completion of my project.

Yashwantrao Pandurang Lavate

MBA (Finance Management)

ASM’s IBMR, Chinchwad, Pune

INDEX

SR.NO. CHAPTER PAGE. No.

1 Executive Summary 1

2 Industry Profile & Organization Profile 3

3 Outline of Task 22

4 Research Methodology & Data Analysis & Interpretation 24

5 Activity Chart 47

6 Key Learning 49

7 Contribution to organization 51

8 Questionnaires & Web Sites Details 53

LIST OF TABLE

SR.NO. Table Name PAGE. No.

1 Rate of Interest 18

2 EMI Chart 21

3 Personal Discussion Format 35

4 Calculation Sheet Format 37

5 Basic Eligibility Chart 38

6 Basic Eligibility Chart 38

7 Basic Eligibility Chart 38

8 Business Incomes 39

9 Income from other Source Table 39

10 Ages Group 40

11 Annual Income 41

12 Own Property 42

13 Types of Property 43

14 Budget 44

15 Home Loan 45

16 Preferred Option Chart 46

17 Work Plan 48

LIST OF GRAPH

SR.NO. Graph Name PAGE. No.

1 Ages Group 40

2 Annual Income 41

3 Own Property 42

4 Types of Property 43

5 Budget 44

6 Home Loan 45

7 Preferred Option Chart 46

Chapter No 1

EXECUTIVE SUMMARY

EXECUTIVE SUMMARY

As a part of the Curriculum of the MBA Programme of the SAVITRIBAI

PHULE PUNE UNIVERSITY. I underwent my summer Training for the Period of TWO

Months at LIC HOUSING FINANCE LTD, Pimpri, Pune. The aim behind is to let the

Students draw out the Difference & Similarities between the theoretical knowledge with the

actual Job conditions, so they can be able to Pursue & Cultivate Strategic decisions making

capabilities & establish themselves as capable Managers of tomorrow.

Each management student learns a lot during his two years of MBA program.

The (summer) project provides required practical training to student and gain the practical

knowledge of the topics learned in classroom and to find its relation with the real market

scenario.

Someone has greatly said that practical knowledge is far better than classroom

teaching. During this project I fully realized this and come to know about the present real

world of home loan sector. It includes all the activities involved in providing home loan

products to the final customers.

I am pleased to know about the consumers’ wants and competitors activities in

the real world of home loan sector. The subject of my study is to analyse the present home

loan sector and products offered by LIC by applying various tools like cold calling and

through direct interaction with customer’s. I have also done research on the customer

reaction, age group taken loan, property types, and different preferred option. his chosen LIC

housing finance & private home loan companies. The report contains first of all brief

introduction about the company.

I also put forward recommendations of the consumers and conclusions

that will help LIC to provide consumer satisfactory services in the home loan sector.

The project gives the live experience about the various aspects of the management

that is help full from future point of view. The project provides the opportunity to understand

the organization very closely.

Chapter No 2

INDUSTRY PROFILE & ORGANIZATION PROFILE

2.1 INTRODUCTION

The purchase or sale of a home or investment property is not only one of the

most important financial events in peoples’ lives, but also one of the most complex

transactions. As a result, people usually seek the help of real estate agents and brokers

when buying or selling real estate.

Real estate agents and brokers have a thorough knowledge of the real estate market in

their community. They know which neighbourhoods will best fit clients’ needs and

budgets. They are familiar with local zoning and tax laws, and know where to obtain

financing. Agents and brokers also act as an intermediary in price negotiations

between buyers and sellers. Real estate agents are usually independent sales workers

who provide their services to a licensed broker on a contract basis. In return, the

broker pays the agent a portion of the commission earned from the agent’s sale of the

property.

Property Service Division of LIC Housing Finance Limited deals with the same

business of real estate. The need of entering in this field was felt by LIC Housing

Finance Ltd due to increasing prospects in Real Estate business. There are many big

brands namely ICICI realty, HDFC Realty, Axis Bank Realty etc.

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. Property services division,

which offers investors and builders a single transparent platform to buy/sell office and

commercial spaces and residential apartments/flats.

This Year LIC Housing Finance Celebrate on 25th

Anniversary on This

Year 19th

June 2014. This Enjoy on All over India Celebration.

2.2 MEANING OF HOUSING FINANCE

The term housing finance is commonly referred to the loans availed by a household for the

purchase or construction of a housing unit. It involves mortgaging of the property as

collateral against which the loan has been taken. Originally, a mortgage was said to have

occurred when the owner pledged her right over an asset owned by her as a security with the

lender for availing a loan. However, as housing loans are given under the condition of

mortgaging the property for which the loan has been availed, the term mortgage finance has

become synonymous to housing finance.

Housing finance covers a wide range of issues, and the concept often varies in its coverage

across different countries; however, it has been defined mainly in terms of residential

mortgage credit.

“Boleat (1985) for instance describes housing finance in terms of the flow of funds to

home buyers”.

“According to Lea (2000) housing finance includes a broad array of institutional

arrangements which include both general and specialized institutions acting as primary or

secondary lenders, with the common purpose of channelling funds from savers to households

demanding housing loans”.

“Warnock and Warnock (2007) describe housing finance as the provision of long-term

financing for house purchase”.

“King (2009) refers to housing finance as the funds used for building and maintaining the

housing stock of a country”.

“Chiquier and Lea (2009) look at housing finance as a link between multi-sector issues

which are in a continuous process of change on account of the economic, cultural, and

regulatory environment of a country”.

They consider housing finance as encompassing more than residential mortgage credit

and include housing developer finance, rental finance as well as housing related micro-

finance within the scope of the term housing finance. Housing finance covers a wide range of

issues, and the concept often varies in its coverage across different countries; however, it has

been defined mainly in terms of residential mortgage credit.

2.3 History of LIC Housing Finance

Launched in 1989 as per Companies Act, 1956 LIC housing finance has grown to be

one of the largest lender in home-finance market

Promoted by LIC that helped in initial business functions. Finally after being

promoted as a company offering housing finance by LIC it went public in 1994.

LIC Housing Finance news state that its authorized capital stands at Rs.150 crores or

Rs.150 million.

Its shares are trade only in dematerialized form at both NSE and BSE.

The company’s GDR was launched in 2004 and is listed on the Luxembourg Stock

Exchange.

Presently, according to Lic housing finance news there are over 181 marketing units;

along with a wide network of 6 regional offices and over 13 back-offices, 773 direct

sales agents (DSA), 3400 home loan agents (HLAs) and 615 customer relationship

associates.

The Company has set up a Representative Office in Dubai and Kuwait to cater to the

Non–Resident Indians in the GLCC countries covering Bahrain, Dubai, Kuwait, Qatar

and Saudi Arabia. Today the Company has a proud group of over 10,00,000 prudent

house owners who have enjoyed the Company's financial assistance.

1989 - The Company was incorporated on 19th June as a public limited company. It

was promoted by LIC of India. The Company provide housing loans to individuals,

builders, development authorities, employers organisation etc.

- The Company has started various schemes: Griha Prakash a general scheme, Griha

Tara under which it accepts only Bima Sandesh Plan as Life Insurance Corporation,

Griha Shobha for NRIs and Griha Lakshmi for people to have a second house.

1994 - 30,057,900 No. of equity shares were issued at a premium of Rs 50/- per share

through public issue on 15th November 1994. The allotment was as follows;

1,082,000 shares to LIC on firm allotment basis and the balance 189,75,900 shares to

public (all were taken up).

1996- The Company has decided to carry out fund based and one-fund based

activities, viz., debt securitisation, lease and hire purchase, renting of properties and

giving guarantee to co-operate bodies.

2000- Crisil has assigned a AAA rating to the issue of mortgage backed pass

through certificate backed by mortgages orginated by the company.

2001 - The Company has launched its new scheme, Griha Vikas.

2002 - LIC Housing Finance Ltd has informed BSE that the Company has forfeited

1,25,300 equity shares due to non payment of allotment/call monies.

-LIC Housing Finance has approved for the take over of Individual Housing loan

portfolio of GLFL Housing Finance.

-Around 25 investors subscribed to the issue of confidentially placed debentures for

a total amount of Rs.392 cr of LIC Housing Finance Ltd.

-LIC Housing Finance Ltd has decreased its interest rates on housing loans by 25-50

basis points.

-Financial Institutions have increased their stake from 0.01% to 1.96% and Mutual

Fund companies have increased their stake from 0.35% to 1.06% in LIC Housing

Finance.

-LIC Housing Finance Ltd has decreased the floating rate of interest under

individual loan scheme to 9.5% from 11%.

-LIC Housing Financee signed a deed of assignment to take over individual housing

loan portfolio of Citibank N A.

-UTI and IFCI has been removed from the list of promoters of LIC Housing

Finance.

2003 - LIC Housing Finance has unveiled a new project for elderly people called

'LIC HFL Care Homes' .

-LIC Housing Finance Ltd has sanctioned 84,126 loans worth Rs.3265.78cr and

disbursed 76,663 loans worth Rs.2941.24cr under its Individual Loan Scheme.

-LICHFL has mobilised Rs.280cr for 15 years at 7% rate of interest through private

placement.

-Lic Housing Finance Ltd has informed that the shares of the company have been

delisted from The Stock Exchange - Ahmedabad w.e.f December 08, 2003.

2004 -Merill Lynch Capitat acquires LIC housing stake of 0.39%

-Templeton Asset Management buys 37,52,362 equity shares, representing 5.01% of

LIC Housing's total paid-up capital of Rs 74.9 crore

-LIC Housing Finance Ltd has informed that the shares of the Company has been

voluntarily delisted from the Delhi Stock Exchange (DSE) W.E.F. January 23, 2004.

-LIC Housing Finance shares delisted from Madras Stock Exchange

-Mr D Krishnan appointed as Chief Executive Officer

- LIC Housing Finance Ltd's (LICHFL) one-crore global depository receipts (GDR)

issue opened on August 27.

- Lists its maiden global offerings worth .85 million at the Luxembourg Stock

Exchange successfully.

-Introduces new product that starts as a fixed rate loan but contains an option to

convert it to a Floating rate loan at the end of five years, at the then prevailing rate.

2005 -Delist from The Calcutta Stock Exchange Association Ltd (CSE) with effect

from December 09, 2004.

-LIC Housing Finance launches loan product that eliminates the requirement of

charge on house financed.

-Goldman Sachs acquires share in LICHFL

2007- LIC Housing Finance to launch FD scheme -LIC Housing Finance to enter

into reverse mortgage product.

2008 -LIC Housing Finance Ltd has informed that the Board has appointed the

following persons as Directors on the Board of the Company on May 20, 2008

-Name of the Director: Shri. D K Mehrotra For the Position of : Managing Director

Change effective from: May 20, 2008.

- LIC Housing Finance Ltd has informed that the Board of Directors of the Company

has appointed following person as Director on the Board of the Company on July 01,

2008.

- Name of the Director: Shri A S Narayanamoorthy

- For the position of: Additional Director

- Change effective from: July 02, 2008

-LIC Housing Finance launches Reverse Mortgage for senior citizens

2009 - LIC Housing Finance cut interest rates for new loans by 0.5% where for

customers opting for floating rate loans between Rs 30 lakh and Rs 75 lakh, the new

rates will be 8.755 against 9.25%.

2010 - The Company is applying for a license with the Pension Fund Regulatory

Development Authority (PFRDA) to act as Aggregator under the, National pension

System (NPS) – Lite.

- LIC Housing Finance Ltd has decided to unveil a private equity fund focussed on

real estate development projects.

- LIC Housing Finance on October 27 has approved a stock split in the ratio of 1:5 to

boost the liquidity of its scrip.

-Company has splits its Face value of Shares from Rs 10 to Rs 2

2011 - Dinesh Kumar Mehrotra, Managing Director for international operations in

LIC, was appointed interim Chairman.

2012 - LIC Housing Finance has said that it has begun the process of raising funds

through Qualified Institutional Placements (QIPs).

2014 - 19-06-2014 25th

year completed

- LIC housing finance Last 25 year Rs. 139000 Crore in Home Loan disbursement

- They are 11000 Representatives helping Indians own homes over the last 25 years

-They are more than 16.8 lakhs Families own homes with our support over the last 25

year.

2.4 Company Profile

LIC Housing Finance Ltd is one of the largest Housing Finance Company in India. The

company is engaged in the business of providing loans for purchase construction, repairs and

renovation of houses/flats to individuals, corporate bodies, builders and co-operative housing

societies and has its operations within India. They provide loans for homes, construction

activities, its corporate housing schemes. Around 89% of the loan portfolio derived from the

retail segment and the rest from large corporate clients. The main objective of the company is

providing long term finance to individuals for purchase / construction / repair and renovation

of new / existing (Resale) flats / houses. The company also provides finance on existing

property for business / personal needs and gives loans to professionals for purchase /

construction of Clinics / Nursing Homes / Diagnostic Centres / Office Space and also for

purchase of equipments. The company through their subsidiaries LICHFL Care Homes

Limited, is engaged in the business of setting up, running and maintaining assisted living

community centre/care homes for senior citizens; LICHFL Financial Services Ltd, is engaged

in the business of marketing various financial products and services, and LICHFL Asset

Management Company Ltd is engaged in business of managing, advising, administering

mutual funds, unit trusts, investment trusts and to act as financial and investment advisors and

render financial advisory services. The company possesses one of the industry's most

extensive marketing network in India. The company is having their registered and corporate

office at Mumbai. They have 7 regional offices, 13 back offices and 190 marketing units

across India. In addition the company has appointed over 1241 direct sales agents (DSAs),

6535 home loan agents (HLAs) and 782 customer relationship associates (CRAs) to extend

their marketing reach. They have set up a representative office in Dubai and Kuwait to cater

to the non-resident Indians in the GLCC countries covering Bahrain, Dubai, Kuwait, Qatar

and Saudi Arabia. LIC Housing Finance Ltd was incorporated on June 19 1989. The

company was promoted by LIC of India and went public in the year 1994. The company is

recognized by 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. In the period of 2001, the company

launched their new scheme called Griha Vikas. In the year 2002, the company signed a deed

of assignment to take over individual housing loan portfolio of Citibank. In the year 2003,

they unveiled a new project for elderly people called LICHFL Care Homes. The company

launched their maiden GDR issue in the year 2004. Also, they introduced flexi-fixed scheme

offering fixed rate of interest for first five years and variable thereafter. In October 2005, the

company started offering of 'New Griha Laxmi' for woman special housing loans against the

security of certain approved financial assets like Bank Fixed Deposits, National Savings

Certificates and Life Insurance Policies. In the year 2006, the company introduced new Griha

Jestha for senior citizens for buying unit of LICHFL Care Homes Ltd. In May 2007, the

company launched maiden Fixed Deposit Scheme. In October 31, 2007, the company

incorporated LICHFL Financial Services Ltd for undertaking non fund based activities like

marketing of housing loans, insurance products, credit card, mutual fund, personal loan etc.

In February 2008, they launched reverse mortgage for senior citizens above 60 years of age.

In February 14, 2008, the company incorporated LICHFL Asset Management Company

Private Limited for undertaking the business of managing, advising, administering venture

funds, unit trust, investment trust in India as well as abroad. In March 5, 2008, the company

incorporated LICHFL Trustee Company Private Limited for undertaking the business of

trustees of venture capital trust, funds - in India and offshore fund. In March 12, 2008, they

launched a new venture capital fund for realty projects. During the year 2009-10, the

company was awarded the 'Second Best Home Loan Provider' award by Outlook Profit.

During the year 2010-11, the company launched a unique interest rate scheme namely; 'MINI

5' to cater to housing finance needs of the priority sector population residing in Tier II and

Tier III cities. Now LIC Housing Lunch New Scheme “Griha Prakash”

2.5 Board of Directors of the Company

2.6 Senior Executives of the Company

Mr. Nitin K. Jage General Manager (Taxation) & Company Secretary

Mr. Ajith Kumar L General Manager (Marketing - Corporates & Project, CRM and Legal)

Mr. N. K. Mittal General Manager (Chief Financial Officer)

Mr. L. C. Meena General Manager (Marketing - Retail)

Mr. S. T. Samtani General Manager (PD & Treasury)r

Mr. P. Shekhar General Manager (IT)

Mr. P. Narayanan General Manager (Accounts)

Mr. S. R. Sharma Chief Manager (HR/OS/Estates)

Mr. Venkatasubramanian B Chief Manager (Audit)

Mr. Pardaman Singh Chief Manager (CRM)

Mr. N. Mahesh Associate Chief Manager (Recoveries, PR, Publicity & Market Research)

Mr. S. K. Roy Chairman

Ms. Sunita Sharma Managing Director & Chief Executive Officer

Mr. K. Narasimha Murthy Independent Director

Mr. S. Ravi Independent Director

Mr. B.N. Shukla Independent Director

Mr. JagdishCapoor Independent Director

Ms. Savita Singh Independent Director

Mr. T. V. Rao Independent Director

2.7 Area Offices Pimpri Address

LIC housing Finance Ltd

Office No 17-20, 3rd

Floor, B Wing

Kamala Cross Road Building

Opp. PCMC Building, Pimpri, Pune 18

2.8 Pimpri Area Office Staff

SR No Name Post

1 Shyam Gowane Area Manager

2 Vikrant More Assistant Manager

3 Pankaj Koranne Senior Associate

4 Ajit Gaikwad Assistant.

5 Dipthi Tapswi Associate.

6 Babanrao Agalave Assistant.

2.9 Various Products 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:

2.10 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 instalments, 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 Lic

Housing 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.

Taking a home loan is a major decision, involving a large investment. Though

the availability of easy financing, innovative products and other value-added

services by Home Loan companies have made the home buying process

relatively easy, for a customer it is still a challenge to decide which home loan

works best for him.

2.11 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.

2.12 OBJECTIVE OF THE STUDY

To Study of the process of Home Loan.

Document Required for Loan Sanction.

Document Required For Loan Disbursement.

Processing fees paid by customer for the processing of the home loan proposal.

To study the process of Customer Verification

To Study the process of Calculation of Loan Disbursement on Property

2.13 Types of Home Loans

The two most widely used types of home loans are fixed-rate loans and adjustable rate loans.

A fixed-rate loan keeps the same interest rate for the life of the loan, which means that the

principal and interest portions of the monthly payment stay the same. Adjustable-rate

mortgages begin with a lower interest rate for the first few years and then adjust to market

rates after the initial period is over. Caps are placed on how much the rate can adjust at any

given time, as well as on how much the rate can increase over the duration of loan. This

means the principal and interest portions of the monthly payment change repeatedly through

the duration of loan. There are different types of home loans tailored to meet our needs. Here

is a list of few:

Housing Loans: This is the basic home loan for the purchase of a new home.

Improvement Housing Loans: These loans are given for implementing repair works and

renovations in a home that has already been purchased.

Construction Loan: This loan is available for the construction of a new home.

Extension Loan: This is given for expanding or extending an existing home. For eg: addition

of an extra room etc.

Home Conversion Loan: This is available for those who have financed the present home

with a home loan and wish to purchase and move to another home for which some extra

funds are required. Through home conversion loan, the existing loan is transferred to the new

home including the extra amount required, eliminating the need of pre-payment of the

previous loan.

Land Purchase Loans: This loan is available for purchase of land for either construction or

investment purposes.

Bridge Loans: Bridge loans are designed for people who wish to sell the existing home and

purchase another one. The bridge loans help finance the new home, until a buyer is found for

the home.

2.14 Processing Fees & Stamp Duty

Up to 50 Lacs 10500/- + Services Tax ( Including Cersai Charges )

Beyound 50 Lacs 15500/- + Services Tax (Including Cersai Charges )

Intimention of Mortage 2000 to 2500 ( If Manual 2500 & Online 2000 )

Memorandum of Deposit of Title Deeds ( If 0.2 % Loan amount stamp paid by sub

registrar Duty & Stamp Paper

Loan agreement 300/- Stamp paper

Affidavite Sum Undertaking 100/- Stamp paper

Power of attorney 500/- Stamp Paper

2.15 Rate of Interest

Scheme ROI Fix For

Celebration 25 10.10 % 2 Years

Super Fix 12.25 %

( Up to 3 Crores)

Full Term

75 Lacs >75 Lacs

New Fixed 10 11.25 % 11.75 % 10 Years

Special Features

Get Sanction Letter Before You Finalised Your Property

Tenor up to 30 Years*

Higher Loan Amount Eligibility

Monthly Reducing Balance

Easy & Simple Documentation

No Required - Guarantor & Insurance Product

Maximum Funding 85 % (up to 20 lac) & 80 % (above 20 lac)

Features

Home Loan

Loan against Property

Balance Transfer + Top Up

Both Fixed & Floating Rates Available

Best Housing Finance Company in Country Awarded by CNBC TV18

Housing Finance Expertise of more than 20 years.

Fees On Prepayment Nil if paid from own sources else 2.00% on the Amount of loan prepaid + Service

Tax applicable

2.16 Home Loan Procedure

With the increasing competition in the market for offering Home Loans, the otherwise

tedious process of availing loans has gone a tremendous change in the recent years. However,

there is still some process involved in the procurement of Home loan. It is advisable for

borrower to first look at the different stages required for obtaining a Home Loan.

Here is step by step procedure of procuring home loan.

Step 1 : Application form

The first step involved in applying for home loan is the procurement of application form

from the HFC of applicant’s choice. The Performa of application every HFC (Housing

Finance Companies) is different from the other but about 80% information required to be

furnished is the same. Along with the application form necessary documents like address

proof, age proof, proof of income, bank balance etc. are also to be attached with the

application form before it is submitted to the HFC. Along with all these documents HFCs

also ask for processing fee of the home loan that varies 0.25% to 0.50% of the total loan

amount.

Step 2 : Personal Discussion

After successfully filling the application form and submitting it to the authority the next

step is face to face with bank or HFC where you have applied for the home loan. The bank

first evaluates the papers submitted and summons the applicant for the personal discussion

regarding the home loan applied for.

Step 3: Bank's Field Investigation

The next step is the field investigation done by the HFC or banks. They send

representatives to the existing residence of the applicants or their offices for the validation of

the documents submitted. This is the essential part for the banks to establish the trust with the

applicants.

Step 4: Credit appraisal by the bank and loan sanction(CIBIL)

This is the make or break stage of the process. The bank or HFC will establishes

repayment capacity based on applicant’s income, age, qualifications, experience, employer,

nature of business etc. to access credential. The bank can refuse loan application if any

discrepancy is found at this stage. But if everything goes according to the conditions

negotiated by the parties then the bank or HFC sanction the loan that may be unconditional or

with some conditions levied.

Step 5: Offer Letter

After the sanction of the Home Loan, the applicant gets offer letter from the bank or HFC

with the following details. Loan amount, Rate of Interest, fixed or variable ROI, Tenure of

the loan, Mode of repayment General terms and conditions of the loan, Special conditions

etc. If the terms and conditions are agreed the applicant has to sign the duplicate copy of the

offer letter and that is to be submitted to the Bank or HEC.

Step 6: Submission of legal documents & legal check

The bank or the HFC now asks for the legal documents of the property involved for

applying home loan. All the legal documents of the property involved have to be submitted.

The bank does all the legal checks on the property. The documents remain with the bank until

the repayment of the Home loan.

Step 7: Technical / Valuation check

The Banks or HFC then go about the technical valuation of the property. The experts of the

bank visit the site to be purchased and value it as per the existing rules and regulations. The

valuation of the property is the most important aspect that the bank considers before

financing any property.

Step 8: Registration of property documents

After the legal and technical valuation of the property the draft documents has to be

cleared by the lawyer and stamping and registration of the documents is needed.

Step 9: Signing of agreements and submitting post-dated cheques

Now it is time of signing the final agreement of the home loan. After the signing of the

agreement a bunch of Post-dated cheques are to be submitted as agreed on the agreement.

It is time for the final Disbursement of the Home Loan. After the bank or HFC

Step 10: Disbursement

It is time for the final Disbursement of the Home Loan. After the bank or HFC ensures

financing the property is involves no risk they pay the final amount that is agreed upon. The

mode of payment varies from full to part payment. In the case of under construction property

the mode is part payment and in the case of ready possession properties disbarment is full and

final.

2.17 E.M.I Chart (for 1 lac)

Term

Celebration 25 New Fix 10 New Fix 10 Sure Fix GV

10.1 11.25 11.75 12.25 12.50

1 8797 8850 8874 8897 8909

2 4620 4673 4696 4720 4731

3 3232 3286 3310 3334 3346

4 2542 2597 2622 2646 2659

5 2130 2187 2212 2238 2250

6 1858 1917 1943 1969 1982

7 1666 1726 1752 1779 1793

8 1523 1885 1612 1640 1653

9 1414 1477 1505 1533 1547

10 1328 1392 1421 1450 1464

11 1258 1324 1354 1383 1398

12 1201 1269 1299 1329 1344

13 1154 1223 1250 1285 1300

14 1115 1185 1216 1248 1264

15 1081 1153 1185 1217 1233

16 1053 1126 1168 1191 1207

17 1028 1102 1135 1168 1185

18 1007 1082 1116 1149 1167

19 988 1065 1099 1133 1150

20 972 1050 1084 1119 1137

21 958 1037 1072 1107 1125

22 946 1025 1061 1096 1114

23 935 1015 1051 1087 1105

24 925 1006 1043 1079 1098

25 916 999 1035 1072 1091

26 909 992 1029 1066 1085

27 902 986 1023 1061 1080

28 896 981 1018 1056 1075

29 890 976 1014 1052 1071

30 885 972 1010 1048 1068

Chapter No 3

OUTLINE OF TASK

Outline of Task

1) Risk of default should be reduced by funding the right customer, by using various

tools of appraising like CIBIL Report, Field Investigation.

2) Exiting Loan (If already & any loan taken Loan) Track Record needed to LIC housing

loan process & Loan approval

3) To find out the customer profile of the Home loan applicants.

4) Most of the Customer prefers LIC Housing Finance Ltd because of its service.

Chapter No 4

RESEARCH METHODOLOGY & DATA ANALYSIS &

INTERPRETATION

4.1 Research Methodology

Research Methodology is a way to systematically solve the research problem. It may

be understood as a science of studying now research is done systematically. In that various

steps, those are generally adopted by a researcher in studying his problem along with the

logic behind them.

Data collection is important step in any project and success of any project will be

largely depend upon now much accurate you will be able to collect and how much time,

money and effort will be required to collect that necessary data, this is also important step.

Data collection plays an important role in research work. Without proper data

available for analysis you cannot do the research work accurately. There are two types of data

collection methods available.

Redman and Mory define research as a “systemized effort to gain new knowledge.”

Some people consider as movement a movement from the known to the unknown it is

actually a voyage of discovery

1) Data Sources:-

In the Preparation of this project it is necessity to collect the Primary data and

Secondary data

2) Primary data: -

The information about the Company is gathered from the discussion with the

employees/staff. Basically I was use primary data for that project

3) Secondary data:-

The secondary data collected -

The balance sheets as on the date of 31st March 2013 for the period of

1st April 2012 to 31

st March 2013

4) Sample size:-

Five cases of Home Loan Proposal are to be studied for understanding of the appraisal of

home loan. Data collected through survey of procedure, service, etc. provided by LIC

Housing Finance Ltd by filling questionnaire of fifty & above LIC Housing Ltd Customer

The methodology of this study has been adopted on the following basis:

Study of various Journals, Notes & Books.

Collection of Primary & Secondary data records of the organization.

Analysis of the collected data for its application.

4.2 Home Loans Two Stages

The housing finance cycle at LIC Housing Finance Ltd is of two stages, both are important

and play a vital role in fulfilling the requirements of housing finance institution.

The two stages are as under-

1. Sanction stage.

2. Disbursement stage.

1. Sanction stage. It is a stage where the customer get sanction or approval that he is eligible to take

a loan of specific amount calculated on the basis of his income from LIC Housing

Finance Ltd.

2. Disbursement stage. It is a stage where the cheque of sanctioned amount is handover to the customer or

concerned person.

3.2.1 Sanction stage

A. Generation of leads/Sourcing of business.

B. Contact & collection of documents from customer.

C. Completion of documents.

D. Field investigation report.

E. Verification of relationship officer.

F. Personal discussion.

G. Final approval or rejection by the branch credit manager.

H. Sanction letter delivered to the customer.

A. Generation of leads/Sourcing of business:- This is an important step in the housing finance cycle to keep the organization

moving successfully. It is essential to generate cases to credit LIC HFL uses methods to

source business & generate leads-

1. Mail.

2. Walk-in interview.

3. Telephone enquiry.

4. Customer reference.

5. Approved project file.

B. Contact & collection of documents from customer:- Once the lead has been sourced the sales officer contact him & give him a list of

documents long with other corresponding information. When the documents are handed

over to sales officer, he submit documents along with the application form to LIC

Housing Finance Ltd. Sales officer gives an idea about how much loan can customer avail

as per his income.

C. Completion of documents:- The document have been collected by the sales officer hand over to the back office

executive, executive then complete documents in special file provided for LIC Housing

Finance Ltd in accordance with the requirement of LIC Housing Finance Ltd.

D. Field investigation report:- After completing the documents the back office executive ties the field investigation

report with the data compiled from the file before moving it on the next stage.

E. Verification by sales manager :- After completion of documents and filing of it, the documents are handed over to the

Sales manager, who verifies the documents to check for loan analysis the strength and

weakness of a case, the loan eligibility & the requirement of additional documents. The

sales manager act as a filter allowing good case to flow through for final approval while

do not fit, into the polices of LIC Housing Finance Ltd. Sales manager make signature if

the case fit into policies of the bank.

F. Personal discussion:- PD is an important stage in sanction process. as per norms loan amount is decided on

the basis of documentation but the customer knowledge, his behaviour can be decided on

the basis of PD with him. It helps to judge the credit worth ness of applicant which helps

organization in future. Sales manager make signature if the case fit into policies of the

bank.

G. Final approval or rejection by the branch credit manager:- The file is send to the branch credit manager for final approval. after checking the file

branch credit manager take final decision of approval or rejection of the case. If the case

is rejected the documents are returned to the customer & if the case is approved then it

goes to the next step.

H. Sanction letter delivered to the customer:- This is the final step in sanction process after receiving the sanction letter it hand over

the sanction letter to customer along with a list of legal documents required for the next

stage i.e. disbursement stage.

3.2.2 Disbursement Stage

A. Collection of legal documents.

B. Completion of documents.

C. Legal appraised.

D. Technical appraised.

E. Final check by the BCM.

F. Cheque disbursement.

A. Collection of legal documents:-

This is the first step towards the disbursement of cheque after sanction of the case.

Already the sales officer collect the legal document from the customer in case of self

construction & or collect it from the builder from whom the customer is purchasing the

property

.

B. Completion of documents:-

Once the documents are collected by the sales officer he hand it over to the back

office executive for compilation the executive complete the documents and process.

C. Legal Appraisal:-

The legal appraisal of a case is an important step & it done by lawyer specially

appointed by LIC Housing Finance Ltd. The lawyer verify the documents to check if the

title of the property is free & marketable from all obligation, other legal aspect is free

from any fraud. once the documents have been verified he submit a legal report to LIC

Housing Finance Ltd. The lawyer report is very essential without his approval no case is

clear. In case of negative remark mentioned by the lawyer the case is being rejected.

D. Technical Appraisal:-

The technical appraisal is a task in which an engineer specially appointed by LIC

Housing Finance Ltd he visit the site and check the property and prepare a report and

submit it to the bank. On the basis of the report the BCM takes his disbursement decision.

1. If the property is in accordance with the plans rules and regulations approved

by NMC.

2. If there are any legal and unauthorized construction on the site.

3. If the owner of the property is the same as mentioned on the legal Documents.

4. The extract or stage of constructions.

5. The raw material etc. available on the site.

6. He checks to see the cost is being incurred on the property is equivalent to the

Estimate shown by the customer.

7. He also Provide an estimated date of compilation of the property.

8. Checking the age and conciliation of the property in case of resale Property.

E. Final cheque by the BCM:-

The BCM makes a final check of the documents before taking his decision. If the

case is clear then BCM send s the file to operational manager.

F. Cheque disbursement:-

This is final step in the disbursement stage. The operation manager prepare the

cheque along with the letter which is handed over to the sales officer who then five it to

the customer. Disbursement of cheque is done in accordance with the stage of

construction as reported by technical advisor.

The cheque is disbursed in two ways,

1. As a part disbursement.

2. Fully disbursement.

4.3 List of Document’s Required For Home Loan Sanction

4.3.1 Salaried Person

1) Application For Completed with 2 Photo Duly Filled in & Signed

2) ID Proof : Pan Card , Passport , Voter Card, Employer ID Card, & Driving License.

3) Residence Proof : Latest Telephone Bill, Bank Statement containing Address for last

6 month. Electricity Bill, Ration Card, Letter from Employer

4) Salary Slips For last 3 months with seal & Sign

5) Latest Form 16 with Seal & Sign

6) Copy of Appointment Letter with Latest CTC & Confirmation Letter

7) Original Bank Statement, Passbook of Salary A/c for Last 6 month with seal & Sign

8) Last Qualification Proof

9) Previous Employment Details if applicant is on Probation

10) LIC Insurance & other Insurance Policy Details if Any

11) Processing Fees Cheque

12) All Track Records for 24 months for existing Loans if any

13) All Document to be Self attested

4.3.2.Self Employed / Professional

1) Application For Completed with 2 Photo Duly Filled in & Signed

2) ID Proof : Pan Card, Passport, Voter Card & Driving License

3) Residence Proof : Latest Telephone Bill, Bank Statement containing Address for last

6 month. Electricity Bill, Ration Card.

4) Last 3 years ITRs ( SARAL, Computation of income, Balance Sheet, Profit & loss

A/c, TDS Certificates ( If Applicable), Tax paid Challans.

5) In case of Partnership firm: ITRs for last 3 years &Partnership Firm.

6) In case of company: Audit Reports for last 3 years & MOA & AOA.

7) Bank Statement / Passbook of Current & SB A/C for last 6 months (update )

8) Alternate Business Proof ( Shop Registration Certificate etc.)

9) Processing Fess Cheque

10) 26 AS for 3 years

11) IT Verification

4.3.3 In Case of Take Over

1. Outstanding Loan Quotation

2. Repayment Track Record

3. List of Document from Bank

4. NOC for take over

5. Copies of Property Agreement

6. Sanction Plan copy ( Blue Print )

4.3.4 Non Residency Indian

1. Copy of Passport , Visa , Service Contract, Salary Slip ( all duly attested by Indian

embassy | Notary | HFL Officials | Bank )

2. GPA ( General Power of Attorney ~ in our format ( all duly attested by Indian

embassy | Notary | HFL Officials | Bank )

3. Bank Statement for past one year of recent employment

4. NRI Bank Statement for 6 months

5. See list of salaried Document

# Above mentioned income document are required for the Co- applicant also if

His / Her income is considered

4.4 List of Document for Disbursement

4.4.1 Post sanction/Legal documents.

Post sanction is legal documents on the basis of which a cheque is disbursed to the

customer. The only security that LIC HFL has against a loan in this legal documents & no

deviation is usually allowed in legal document. These documents are sending to the lawyer

who verifies before being accepted by LIC HFL. These are as follows:

1) Direct From Builder Case:

Agreement of Sale

Sub Registrar Receipt

No objection certificate from builder

Own contribution receipt from builder

2) Direct from Registered Co-op Housing Society Ltd.:

Share Certificate

Allotment Letter

No Objection Certificate from Society

Own contribution receipt from Society

Copy of Society Bye Laws

Society Registration Certificate

Registered Agreement if not Original member

3) Own Construction Case:

Original Sale Deed with Registration Receipt.

7/12 Extract

6 D Extract

NA Order Copy

ULC Order Copy

Latest Title Clearance Certificate

Original Architect Estimate

Commencement Certificate

Prior Sale Deed with Original Reg. Receipt.

4) Resale Case:

Sale Deed/Agreement with Registration Receipt

Previous Customers Sale Deed/Agreement with Registration Receipt

Own Contribution Receipt

NOC from Builder/Society

Title Certificate

Share Certificate & Allotment Letter (if applicable)

NA Order & NA Tax Receipt (Xerox)

ULC (Xerox)

7/12 & 6-D Extract (Xerox)

Commencement Certificate & Completion Certificate (Xerox)

Society Registration Certificate & Bye-Laws (Xerox)

Title Certificate (Xerox)

Building Plan (Xerox)

5) MASTER FILE/LEGAL FILE:

Sale Deed/lease Deed/Gift Deed or Development Agreement/Power of

Attorney/Partnership Deed

NA order & ULC

Commencement Certificate & Completion

Building plan

7/12 Extract & 6-D Extract

Title Certificate

Society Registration Certificate

Bye Laws Copy.

3.4.2 Analysis of Legal Documents

All owners of the property should be applicants

Check for cost of property and OCRs paid

Signature of the owners should match with the application form

Witness should sign the agreement

Priority and Non Priority documents to be collected as per legal report

NOC From builder/ society / development authority as the case may be

Own contribution receipts

Agreements

Current agreement must be registered

Stamp Duty receipt required

Registration receipt required

Stamp duty receipt and registration receipt amount to be added to cost of property and

calculated as OCRs too.

NOC

NOC should be on the letterhead of the Society/ Builder / Development Authority

Should have the stamp of the society / Builder / Development Authority

Address should match as per the agreement, Flat No., Wing No. etc..

Should be as per the procedures and drafts for different transaction types.

Must be dated

Own Contribution Receipts

Must have a revenue stamp

Cash payments cannot be more than Rs.20000/-

Should give details of the property like flat No. etc

In case of refinance > Rs.1 lac

Builder case – Receipts from builder & debits in bank account

Resale – Agreement for sale / Sale deed to be registered before refinance

Property Norms:

Property should not be in negative area

Property should be within geographic limits

Property should be self contained

Maximum age of property less than 35 years at loan application

Loan tenor not to exceed residual age of the property

Minimum Built up area > 400 sq. ft

In case of row house of ground floor only

4.5 Personal Discussion

(Salaried Persons)

Name of the Applicant

1. a) Name of the Employer Organization

b) Designation

c) No. of year in service with present employer

2. a) Educational Qualification

b) Name of University / Institute

c) Year of Passing Out

3. Past Experience – No. of Jobs changed

Previous Employer 1

a) Name of Organization

b) Designation

c) No. of year in Service

4. Previous Employer 2

a) Name of Organization

b) Designation

c) No. of year in Service

5. Family Status

a) Whether Spouse is Co- applicant?

b) Whether Spouse is working?

Salaried / Self – employed

6. Details regarding existing Place of Residence

a) Current Residence – Owned/ Rented/ Company

Leased/ Parental

b) No. of years staying at Current Residence

c) In case of Company Leased Accommodation

whether planning to shift to new Premises?

If yes, Expected Sales Proceeds/ Rent

d) In case of Second House, plans for existing

property – whether existing Property will be Sold /

Rented?

If yes, Expected Sales Proceeds /Rent

7. Details of Saving / Investment

a) Immovable Property / Bank FD / Savings Balance

/ NSC / KVP / Mutual Fund / Shares & Stocks /

Bonds, PPF, Insurance Policies

8. Complete Details of existing Loans / Liabilities

provided in Application Form?

Whether Application intends to close any of them?

9. As per Applicant’s view, how much EMI can he pay

to LICHFL

10.

a) Whether Property identified?

b) Approximate Property Value

c) Source of Margin Money

11. Comment on end use of Money in case of Top-up

Loan & Loan under Griha Vikas Scheme.

12. Whether procedure for Sanction of Loan e.g.

Verifications CIBIL explain to the Applicant?

4.6 Calculation Sheet of Loan on his Payment

Format

APPLICANT EARNING

Particulars Amount ( P.M.)

Basic Pay

DA

HRA

Transport Allowance

SPL Allowance

Performance Allowance

Medical Allowance

LTA

Education Allowance

Variable ( Annual )

LTA

PLI/ Bonus/ Incentive

Medical

Total Variable

TOTAL EARNING ( A )

DEDUCTIONS

Particulars Amount

Provident Fund

Professional Tax

Income Tax

Transport

Canteen

Loan 1

Loan 2

Loan 3

Loan 4

TOTAL DEDUCTION (

B )

NET INCOME (A-B)

Applicants Age ( D )

Loan Term ( E )

Age + Term ( D+E )

Total Net Income

Loan Amount

EMI

MLSC

4.7 Customer – Basic Eligibility Calculation.

FOIR: Fixed Obligation to Income Ratio:

Income Applicable FOIR

Below 20000 to 25000 50 %

25000 and Above 60 %

How we treat income from other sources?

Source %Eligibility Proof

Agricultural income (As

stated in ITR)

50 % of average of last 2

years

3 years ITR’s and 7/12

extract or ownership

document copy.

Rental Income 100% of average of last 2

years

03 ITR

Rental Income 100% of current rental

income as per lease

Agreement

Lease Agreement for 3 years

Rental Income 50 % of current rental income

as per leave & License

Agreement

Leave & License agreement

copy of current period

LIC /Broker commission i.e.

NSC, KVP, IVP postal

50 % of new business &

100% of renewal business

Certificate / original

commission slip of Cos.

Interest / Dividend Income 50 % of average of last 2

years

03 years ITR’s

The agreement of the eligibility from other sources of income must not be more than 100 %

of the agreement of the main salary income.

1) Resident Indian – Salaried:

ITEM CONSIDERATION

REG.ITEMS (PAYSLIP) 100%

HRA 100%

PENSION INCOME 100%

BONUS 100%

ANNUAL BENEFITS 50%

FIXED

REIMBURSEMENTS

50%

VARIABLE ITEM 50%

2) Self-Employed – Professional:

For calculation purpose SEPs can be classified as per following pattern –

a. Doctors

b. Allopathic (MBBS plus)

c. Other (BHMS, BUMS, (etc.)

d. Others (CA, CWA, CS, Lawyer, Consultant etc)

Methods Used

1. GPR Multiplier Method

2. Eligibility based on Net Profit

3) Resident Indian – SENP:

Business Income

Av. Net Profit (PAT) for last two years Net Profit

Add: Depreciation* Depreciation

--------------

Business Income

Personal Income (Salary / Remuneration)

(Av. For last two years)

Personal Income

Total Appraised Income = BI + PI

Income from other sources

Type Eligibility Proof

Agricultural Income 50%* ITRs

Rental Income 100%* ITRs

Interest/Dividend Income 50%* ITRs

*Average of the last two years amount

Income from above sources should not exceed

50% of the Total Appraised Income

4.8 Data Analysis

Table 1:

Age Group Percentage

25-35 45

35-50 35

50-60 15

Above 60 5

Total 100

Graph 1:

Analysis:

It was found that about 45% of people were between age group of 25-35, 35% were

between 35-50, 15% were between 50-60 and 5% were above 60.

Interpretation:

Thus we conclude that the average percentages of people in the above age groups showed

interest in the survey of LIC HFL

45

35

15 5

Age Group

25-35

35-50

50-60

Above 60

Table 2:

Annual Income Percentage

Below 2 lacs 2%

2-5 lacs 30%

5-10 lacs 65%

Above 10 lacs 3%

Total 100%

Graph 2:

Analysis:

It was found that 2% of candidates are below 2 lacs. 30% are between 2-5 lakh. 65 % of

are between 5-10 lakh. While only 3% are above 10 lakh.

Interpretation:

Therefore it can be conducted that maximum income group was found between 5-10 lacs.

Percentage

0%

100%

Below 2 lacs 2-5 lacs5-10 lacs

Above 10lacs

Annual Income

Percentage

Table 3:

Possess Property Percentage

Yes 67%

No 33%

Total 100%

Graph 3:

Analysis:

67% of candidates possess their own property and 33% of candidates had no property.

Interpretation:

This shows that out of 100 respondents 67% had their own property while 33% had no

property. 67% were not willing to invest or buy any property.

33%

Own property

Yes

No

Table 4:

If yes, the type of property-

Graph 4:

Analysis:

It was found that 78% of the candidates preferred residential property. 18% wanted

Commercial while only 4% of the respondents wanted other than residential and

commercial property.

Interpretation:

Thus, it can be concluded that 78% of the respondents wants to invest in the property

for living purpose. While 18% wants to derive their business with the help of that property.

78

18 4

Type of Property

Residential

Commercial

Others

Type of Property Percentage %

Residential 78

Commercial 18

Others 4

Total 100

Table 5:

Budget Percentage

10-30 69

31-50 21

Above 50 10

Total 100

Graph 5:

Analysis:

69% have budget more than 50 lacs. 21% have between 31-50 and 10% have between 0-30

lakhs

Interpretation:

Thus, it can be said that major respondents do not want to invest much to buy a property. As

majority of the respondents are of middle class society. While there are only10% who belong

to high class society can invest above 50 lakhs.

69

21

10

Budget

0-30

31-50

Above 50

Table 6:

Home Loan Percentage

Yes 79

No 11

Can’t Say 10

Total 100

Graph 6:

Analysis:

79% of respondents preferred home loan while 11% did not prefer loans. There were 10% of

respondents who could not decide whether to take or not.

Interpretation:

Major respondents wanted to buy a property over loan basis as mostly respondents are service

men. Those who did not prefer loan were businessmen.

79

11

10

Percentage

Yes

No

Can’t Say

Table 7:

Preferred Option Percentage

SBI 32

HDFC 16

LICHFL 12

ICICI 10

AXIS 8

PNBHFL 9

CANARA 3

ALLAHABAD Bank 6

DHFL 4

Total 100

Graph 7:

Analysis:

32% respondents preferred SBI. 16% preferred HDFC. 12% preferred LICHFL. 10%

preferred

ICICI. 8% preferred Axis. 9% preferred PNBHFL. 3% preferred Canara Bank. 6% preferred

Allahabad Bank. 4% preferred DHFL.

Interpretation:

Maximum proportion of respondents preferred to opt for SBI. This shows that most of them

have faith in SBI. Next preference is to HDFC and then LICHFL.

32

16 12

10

8

9

3 6 4

SBI

HDFC

LICHFL

ICICI

AXIS

PNBHFL

CANARA

ALLAHABAD Bank

DHFL

Chapter No 5

ACTIVITY CHART

5.1 Activity Chart

Work Plan S. No. Date Activities

1 15/05/2014 Start Work ( Discussion about the topics for study )

2 22/05/2014 Initial Study (Selection of the topic of Initial Study)

3 29/05/2014 Secondary Data Collection

4 12/06/2014 Primary Data Collection

5 03/07/2014 Data Analysis/ Interpretation

6 16/07/2014 Project completion ( Discussion with the project guide & Reporting here)

7 16/07/2014 Summer Internship Programs End of Stage

Chapter No 6

KEY LEARNING

6.1 KEY LEARNING

1) The Process of all types of home loan taking.

2) Document Required for Loan Sanction.

3) Document Required for Loan Disbursement.

4) How to the determine the Processing fees applicable for various customer

5) Process of Customer Verification

6) How the Manager deals with the various customer

7) How to determine loan eligibility based on EMI chart

8) Minimum balance required for qualifying loan

Chapter No 7

CONTRIBUTION TO THE ORGANIZATION

7.1 Contribution to The Organization

1) Visits to the various Residential Construction sites & attract new customer to our company

2) In PCMC area I have visited on more than 10 Builder construction sites

3) In PCMC area I have visited to more than 50 customers by visiting their residence

4) In two months I had recommended 11 customer to LIC housing family from my own

reference ( 11 customer taking a loan) & after two month of ( SIP ) in addition to 5 customer

have availed the loan from my own reference.

5) Daily calling for new customer & asking a customer requirement for loan & follow up of

customer.

Chapter No 8

QUESTIONNAIRE & WEB SITE DETAILS

8.1 QUESTIONNAIRE 1. What is your age?

A. 25-35 B. 35-50 C. 50-60 D. above 60

2. What is your occupation?

A. Service Class B. Businessman C. Professional

3. What is your Annual Income?

A. Below 2 lac B. 2 -5 Lac C.5-10 lac D. Above 10 Lac

4. Do you have your own property?

A. Yes B. No

5. What is your Property Cost

A. Above 10 to 25 lac B. Above 25 to 50 lac

C. Above 50 to 75 lac D. More than 75 lac

6. What is your reaming balance ( Source of Fund ) paid by Builder ?

A. Saving in Bank B. Provident Fund

C. Disposal of Investment / Property D. Loan from Employer

7. Are you interested in buying a property in near future?

A. Yes B. No C. Can’t say

8. If Yes Which type of property you interested?

A. Residential B. Commercial C. Other

9. If interested, the main purpose of buying the property is-

A. For self purpose B. For investment

C. Others ___________________

10. Are you satisfied with the home loan procedure of Bank? Yes No

11. Rate of interest at LIC Housing Finance is

High Low Normal

12. Pl Specify the location in which you are interested for buying property?

_______________________

Name:

Address:

Contact No:

CASE NO.1

1) Applicant Name : Mr. Nilesh Palhade

2)Loan Amount Applied : 1967000/-

3)Tenor Requested : 25 Yrs

4)Profile :

Applicant : Salaried

Organisation : Deutsche Bank

5) Monthly salary:

Applicant: Rs.27242 p.m. & Incentive Rs.7550 p.m.

6) Strength of the Case:

Bank Salary

Qualified Profile

No Existing obligation

Super Worksite Company

7) Findings:

1) Field Investigation report is Negative due to House found locked at the time of

Visit.

2) Exiting Loan For Education Loan Track Record One Cheque To Bounce

8) Suggestions:

1) Field Investigation Report is Negative and FOIR is exceeding hence; Approval

should be taken from Higher Authority i.e. Regional Business Head.

2) Reason for Cheque Bounce on his Education loan

CASE NO.2

1) Applicant Name : Mr. Yogesh Patil

2) Co-Applicant Name : Mrs. Geeta Patil

3) Loan Amount Applied : Rs. 1600000/-

4) Tenor Requested : 20Yrs

5) Profile :

Applicant : Business

Organization : Tax Consultancy, Life Insurance Agent

Co-Applicant : House Wife

6) Monthly salary:

Applicant: Rs.423142 p.a.

7) Strength of the Case:

Bank Balance Good

Good Business Report

Good Saving in Recurring Deposits, Fix Deposits

LIC Policy worth Rs 30 Lakhs

Income tax Paid in Time & Customer is tax Consults

8) Findings:

Applicant Bank Statement showing monthly deduction of EMI of Axis Bank and the

said was reflected in CIBIL Verification report.

9) Suggestions:

As per discussion with Applicant his Loan to be close after Sanction. There Loan

Closing NOC Report attach in Disbursement file.

CASE NO.3

1) Applicant Name : Mr. Khushboo Singh

2) Co-Applicant Name : Mr. Prakash Singh

3) Loan Amount Applied : 2725000

4) Tenor Requested : 20 Years

5) Profile:

Applicant : House wife

Co-Applicant : Salaried

Organization : SKH Magneti Marelli Exhaust Sys Pvt, Ltd.

6) Monthly Income:

Co-Applicant : Rs.68477 p.m.

7) Strength of the Case:

Good Salary

Very Very Good Bank Balance Maintaining (above 25000 for Minimum)

Good RTR of Existing H. Loan

8) Findings:

1) Co-Applicant Bank Statement showing monthly deduction of Rs.11458 & 3859 as EMI

of Housing Loan & Personal Loan

2) Co-Applicant Purchase on second property.

9) Suggestions:

1) As per discussion with Co-Applicant he is not going to nil that Housing loan hence the

said EMI should be considered as obligation in loan eligibility calculation & Demand on

Track Record for Both Loan

CASE NO.4

1) Applicant Name : Mr. Sambhaji Karpe

2) Loan Amount Applied : Rs 450000/-

3) Tenor Requested : 10 Year

4) Profile :

Applicant : Salaried

Organization : Emcure Pharmaceuticals Pvt. Ltd

6) Monthly Income:

Applicant : Rs.34512 p.m.

7) Strength of the Case:

Good Bank Balance

Good Salary on his Demanding Loan

PF Balance is 7 Lakhs

8) Findings:

1) Applicant Bank Statement showing monthly deduction of EMI of LIC Housing Loan

for his Previous loan and the said was reflected in CIBIL Verification report.

2) Applicant salary slip is not self attested

3) Applicant take a Top-up Loan on his personal work

9) Suggestions:

1) Applicant is not need for close his Home Loan for Existing because his that loan

additional loan taken

CASE NO.5

1) Applicant Name : Mr. Pratha Sarathi Mukherjee

2) Co-Applicant Name : Mrs. Sutapa Mukherjee

3) Loan Amount Applied : Rs.1,650,000/-

4) Tenor Requested : 9 Years

5) Profile :

Applicant : Salaried

Organization : Jankidevi Bajaj Gram Vikas Sanstha

Co-Applicant : House wife

6) Monthly Income:

Applicant : Rs.36314 p.m.

7) Strength of the Case:

Salary

Bank Statement is Very Good Maintain

Good Investment in Fix Deposits & Mutual Fund Recurring Deposits

Stable / Govt. Job

No any Obligation

PF Balance worth Rs.20 Lacs

Owned House worth Rs.35 Lacs

Qualified Profile

8) Findings:

Applicant’s Age is 51 years.

9) Suggestions:

Loan Amount possible for only 9 years remaining in the service hence maximum loan

tenor should be restricted to 9 years.

8.2 Bibliography

8.2.1 Books & Sites:

Books

LIC Home Loan Guidance Book

Research Methodology By C. R. Kothari

Sites

www.lichousing.com

www.moneycontrol.com

www.google.com

www.rupeetimes.com

www.economictimes.indiatimes.com

www.profit.ndtv.com