A

PROJECT REPORT
ON
“A STUDY OF HOUSING LOAN”

AT

DEWAN HOUSING FINANCE CORPORATION LTD

(AMRAVATI)

SUBMITTED TO
SAVITRIBAI PHULE PUNE UNIVERSITY

IN PARTIAL FULFILMENT OF REQUIREMENT FOR THE

AWARD OF MBA

BY

ASHISH SAMADHAN BHOPSE

UNDER THE GUIDANCE OF

PROF. SUMIT BANKAR

SINHGAD INSTITUTE OF BUSINESS ADMINISTRATION AND

RESEARCH
2014-2016

1
 DECLARATION

I, the undersigned, hereby declare that the Project Report titled “A STUDY OF
HOUSING LOAN” written and submitted by me to the University of Pune in partial
fulfilment of the requirement for the award of MASTER OF BUSINESS
ADMINISRATION (M.B.A.) is my original work and the conclusions drawn therein are
based on the material collected by myself.

Place: Pune Date:

Signature

(ASHISH S BHOPSE)

2
ACKNOWLEDGEMENT

This report is a brief account of the work carried out during the period of 60 days of
training in Dewan Housing Finance Corporation Ltd, Amravati. The training period
comprises a lot of learning experience for which I am thankful to many people who
helped me throughout the training duration.

I show special gratitude towards Mr. Amol Misal, Branch Manager, and all Staff
Members of DHFL, Amravati, and my Project Guide Prof. Sumit Bankar for his kind
Co-operation to make this project.

I would like to thank our Director Dr. Avadhoot Pol, SIBAR for providing an
opportunity to undertake the project.

I extend my sincere thanks to all those people who have helped me in the successful
execution of the project with their valuable suggestions.

Ashish S. Bhopse
Master of Business Administration (MBA)
SIBAR

3
 INDEX
SR
NO. CONTENTS PG NO.

1. EXECUTIVE SUMMARY

2. INTRODUCTION OF THE STUDY

Introduction

1.1 History

1.2 Company profile

1.3 Objectives

1.4 Scope of the Report

1.5 Limitations of the Study

1.6 Research Methodology

3. CONCEPTUAL BACKGROUND

2.1 Concept of Loan

2.2 Credit Policy

2.3 Credit Facilities

2.4 Processing of Loan Approval

4. DATA PRESENTATION, ANALYSIS AND

INTERPRETATION
3.1 Data Analysis And Interpretation

5. FINDING, SUGGESTIONS AND CONCLUSION

4.1 Findings

4.2 Suggestions

4.3 Conclusion

BIBLIOGRAPHY

4
EXECUTIVE SUMMERY

Home is a dream of a person that shows the quantity of efforts, sacrifices, luxuries
and above all gathering funds little by little to afford one’s dream. Home is one of the
things that everyone wants to own. Home is a shelter to person where he rests and
feels comfortable. Many financial institution provide home loans whether commercial
banks or to the people who want to have a home.

The housing sector plays an important role in the economic development of the
country.
My project title is “A STUDY OF HOUSING LOAN WITH SPECIAL REFERENCE
TO DHFL”. I selected this topic because the Indian Housing Finance Industry has
grown by leaps and bound in few years. Total Home Loan disbursement by banks has
raised which witnesses’ phenomenal growth from last five years. There is greater
number of borrowers of home loans. So by this study we can find out Satisfaction
level of customers and problems faced by them in obtaining Home Loans.

My project duration was of two months, and it’s started from 25th May 2015.At first it
started with the introduction where I was given the knowledge of DHFL and its
policies.

5
CHAPTER-1

INTRODUCTION

6
1.1INTRODUCTION OF REPORT

HISTORY

DHFL was started in 1984 with the philosophy of enabling home ownership. Since
then, the Company has retained its position as one of India’s largest housing finance
companies, driven by the Vision to make home ownership affordable for all.

Over the decades, home finance companies like DHFL have not only influenced the
social fabric of the country but also benefited from it. The Company had the foresight
to address the notion that taking loans was not advisable. Concurrently, the Company
capitalised on rising family incomes, shrinking family sizes and widening
urbanisation.

Home finance providers like DHFL helped millions of Indians mobilise adequate
funds to buy or build their own homes. In a decision, which would later be described
as ‘financial inclusion’ ,DHFL selected to focus on the challenging Tier-II and Tier-
III markets. Rather than fund financially. Comfortable customers, DHFL funded the
needs of those without adequate income substantiating documentation. In doing so,
DHFL didn’t just address the needs of an existing market, it helped create one. DHFL
extended from merely financing homes to encouraging home building. DHFL
graduated from mere transactions to catalysing the national economy.

DHFL’s nation-building role was even more pronounced when the Indian economy
passed through a challenging slowdown in the last decade. The performance of
housing finance companies like DHFL remained one of the economy’s brightest
features, catalysing the offtake of nearly 300 downstream sectors.

Given this ‘ripple’ role, the priority is not justfor the Government to make small
incremental changes, but to facilitate home financing, make home ownership cheaper
and in turn propelthe economic engines, leading to a full-blown economic recovery.

The result is that home-building, which remained priority across the past 30 years,
will continue to be relevant for decades to come.

7
 1.2Company Profile

Over the past three decades, an organisation has been fuelling and fulfilling one of
India’s cornerstone dreams – of owning a ‘home’. A dream that begins from the time
we commence our education; adream that is nurtured through the time we get our
academic degree;a dream that is inspired with the first job move; a dream that
iscatalysed by the nudge of the spouse. While we have all grown up with this dream,
the reality is that relatively few Indians have succeeded in owning their own homes.

India’s home shortage of an estimated 63 million units continues to be the highest in

the world. Interestingly, even as India is still engaged in catching up with the demand
for homes generated over the years, the prospective demand is only going to increase
further. India has added 181.96 million persons to its population during 2001-11,
possibly the highest quantum increment across any country. The country’s economy
continues to be one of the fastest growing in the world. The proportion of the
country’s breadwinners aspiring to buy their first homes is rising. The number
expecting to graduate from kutcha to concrete or from smaller to bigger homes is
increasing.

For the last three decades, DHFL has been fulfilling the dreams ofmillions of aspiring
Indian home buyers through affordable loans.DHFL has addressed the home
financing needs of the second mostpopulous country through economic crests and
troughs. DHFLhas made home financing affordable across decades of
differenteconomic periods.

This, our multi-market and multi-year vigour is encapsulated in one enthusing line.

8
VISION

‘To transform the lives of indian households by enabling access to home ownership.’

MISSION

 Be easily accessible to every Indian who desires to own a home

 Understand our customers’ inner needs and speak their language
 Go to any length to make sure our customers don’t feel intimidated
 Continuously configure our credit policy to make sure the maximum number
of people can be eligible for loans
 Find ways to help our customers tide over difficult times
 Spread our network to every corner of India
 Respond promptly and courteously to all enquiries

9
 BOARD OF DIRECTORS

MR.KapilWadhawan Chairman & Managing Director

Mr.DheerajWadhawan Non-Executive Director
Mr.G.P.Kohli Independent Director
Mr.V.K.Chopra Independent Director
Mr. MannilVenugopalan Independent Director
Ms. VijayaSampath Independent Director
Dr. Rajiv Kumar Additional Director (Independent
Director)

10
1.3 OBJECTIVE OF REPORT

 To analyze the process of home loan at DHFL

 To promote good and fair practices by setting minimum standards in dealing
with customers.
 To increase transparency so that the customer can have a better understanding
of what they can reasonably expect of the services.
 To encourage market forces, through competition, to achieve higher operating
standards.

11
1.4 SCOPE OF THE REPORT
 The study has been undertaken mainly to highlight the features of housing
loans offered by Dewan Housing Finance Ltd at Amravati Branch area. All
kinds of borrowers like Businessmen, Agriculturists, Professionals,
government employees, Private employees and self employed people have
been included in this study. It has been undertaken from the stand point of
borrowers, and company are excluded from the study. Only individual
borrowers have been taken and other is excluded from the study.
 This project report gives brief understanding about guideline/norms of DHFL
relating to Housing Loan.
 This project report study gives a detailed study of home loan provided by the
DHFL

12
1.5 LIMITATIONS OF THE STUDY

 This study is limited to DHFL, as it is based on the process of home loan

followed by the company.
 Analysis of Financials is restricted to the company’s requirement.
 The factors may be limited to the region of the study.
 The importance of factors may be limited to the region of the study.
 The factors may be specific to the chosen dhfl for data collection.

13
1.6 RESEARCH METHODOLOGY

RESEARCH DESIGN-
This project is divided into three parts, so this study have used separate research
design for each part -

Types of loans available - Descriptive research Design

 Descriptive studies generally take raw data and summarize it in a useable

form.
 To find out various loans available, different kind of bank’s circulars & books
are used. Both circular and book is studied and summarized in project report.

Loan procedure- Experimental Research Design

 Experimental Research Design is the art of planning and implementing an

experiment in which the research has control over some of the conditions
where the study takes place and control over some aspects of the independent
variable(s) (presumed cause or variable used to predict another variable).
 Company has set a specific procedure to sanction loans. The actual procedure
followed by company to sanction loans is studied.

14
DATA COLLECTION-

Primary Data: For carrying out this studies

 Questionnaire as a method of primary data collection.

 Another method used in this project is Observation method.
 Personal interview.
 Here structured surveys method which consists of formal lists of questions asked
to all respondents in individual group in the same way.

Secondary data:

 The secondary data used for the project- Credit policy of the DHFL and process
followed while sanctioning loan.
 Web sites.

15
RESEARCH INSTRUMENTS-

THE QUESTIONNAIRE-
Closed-ended Questionnaire-
 Closed ended questions include all possible answers/prewritten response
categories, and respondents are asked to choose among them. -e.g. multiple
choice questions, scale questions.
 Type of questions used to generate statistics in quantitative research.

 As these follow a set format, and most responses can be entered easily into a
computer for ease of analysis, greater numbers can be distributed.Closed
ended questionnaire is structured, respondent have to select an option as
answer for question.

SAMPLING DESIGN-
Sample- Managers, Senior Accountants, Finance process Manager, Branch
Manager etc. of The DHFL

Sample size- 30

SAMPLING TECHNIQUEs-

A) No-Probability sample:
 The researcher might select people who are easier to obtain
information from.
B) Convenience sample:
 The researcher selects the easiest population members from which to
obtain information.

In this project Non-Probability Convenience Sampling technique is used as

respondent are selected from a population that are easily available.

16
 CHAPTER-2

CONCEPTUAL BACKGROUND

17
CONCEPT OF LOAN:
Meaning of loan:

The term ‘loan’ refers to the amount borrowed by one person from another. The
amount is in the nature of loan and refers to the sum paid to the borrower. Thus. From
the view point of borrower, it is ‘borrowing ‘and from the view point of company, it is
‘lending’. Loan may be regarded as ‘credit’ granted where the money is disbursed and
its recovery is made on a later date. It is a debt for the borrower. While granting loans,
credit is given for a definite purpose and for a predetermined period. Interest is
charged on the loan at agreed rate and intervals ofpayment. ‘Advance’ on the other
hand, is a ‘credit facility’ granted by the company. companys grant advances largely
for short-term purposes, suchas purchase of goods traded in and meeting other short-
term trading liabilities. There is a sense of debt in loan, whereas an advance is facility
being availed of by the borrower. However, like loans, advances are also to be repaid.
Thus a credit facility- repayable in installments over a period is termed as loan while a
credit facility repayable within one year may be known as advances.

Meaning of Housing Loan:

Every human being aspires to have his own house to live in. After food and clothing,
housing is the third most important human requirement. On an average a person
spends almost two-thirds of his life in a house which is his sanctuary in his old age.
Adequate housing is therefore a fundamental need of human beings and an essential
pre-requisite for physical, intellectual and mental development. Blessed are those who
live in their own house and fortunate are those who have the money to buy one. But
all are not privileged to buy a house of their own. For many such less privileged,
buying a house has become possible in modern times through housing loans.

Though shelter was enshrined as a fundamental right in the constitution, housing did
not get the attention it reserved. This was perhaps due to the fact that at that time
nobody expected the problem of housing to assume the present gigantic proportions.
Proper housing, even at a lower scale, has never kept pace with the minimum
requirements of the people. The housing backlog has been compounded by the high
rate of population growth. Inadequate housing facilities have led to the rapid growth

18
of slums and unauthorized settlements, poor quality of services, housing land prices
and increasing costs of construction. In rural areas the situation is even more
alarming. The Government and some public sector undertakings have been trying to
tackle the problem but their efforts do not much even the fringe of the problem. The
central and state governments cannot solve this problem. So the Life Insurance
Corporation of India and housing societies entered the field of housing loans for their
customers. Today these are 350 housing finance companies registered with the
registrar of companies, of these 29 have been approved by National Housing Bank for
financial assistance. The housing finance industry has been borrowing at the rate of
nearly 35% for the last two years. Over the last 3 years Commercial banks and Private
sector banks have been playing an important role in housing finance. All Commercial
banks and Private sector banks are now emerging as lenders in the segment, taking a
slew initiatives in the form of opening dedicated outfits/cells to cater to the ever-
increasing demand for housing loans, offering competitive interest rates with fixed/
variable options, Waiver of processing fee, Free additional attractive packages and
flexibilities in housing loan Schemes. Generally the traditional trend of the term
“Housing Loans” or “Housing Finance” means finance for buying or modifying a
property. Hence “Housing Finance” may be defined as the financial resources for an
individual or a group of persons used facially for the purpose of housing.

A study of the housing loan schemes offered by would pave the way taking certain
policy decisions for improving these housing loan schemes.

19
SPECIAL HOUSING SCHEME OF DHFL

1) Home loans
2) Home improvement loans
3) Home construction loans
4) Home Extension loans
5) Home loans for self employed
6) Plot loan/Land loan
7) Home loan balance transfer
8) Plot and construction composit loan

20
PRODUCT POLICY OF THE DEWAN HOUSING FINANCE LTD.
1)Purpose:

 Purchase of a new house/flat.

 Purchase of new house/flat. The residual age of the property as confirmed by
our empanelled valuers should not be less than 30 years.
 Extend/Renovate/Repairs of a house or flat already owned by self
(Extension/Renovation Plant)
 Takeover of existing housing loan (Balance transfer)
 Loan takeover with additional finance (Balance transfer with Additional
Finance
 Construction of a house on plot of land already owned (Self Construction)

2) Eligibility Criteria:

Salaried Self Employed

Age Minimum: 21 years Minimum: 21 years
Maximum: retirement Maximum: not more
age than 65 years of age at
the time of maturity of
the loan
Experience Minimum 2 years Minimum 3 years of
business continuity
Income Minimum 7500/- per Minimum 1.20 Lacs
month per annum

21
 1. Loans will be given to individuals
2. NRI’s, HUF, minors, lunatics, and insolvants are not to be consider for
loans
3. Maximum 4 incomes can be clubbed
4. Doctors qualified as Ayurvedic, Homeopathy, Unani etc. will be
consider under self employed non professionals
5. The dates of filling of two years tax returns should be at least 9 months
from one another

Processing Fees:

The applicants are required to pay processing fees as per rates in force from time to
time, based on percentage to the loan amoumt proposed to be sanctioned along with
appropriate service tax there on as per service tax rates prevailing.

 Processing fees is 1.5% of the loan amount plus service tax subject to
minimum of Rs.5000/- plus service tax. Equitable mortgage charges will be
borne by the customer.
 Rs.3000/- plus service tax shall be collected as non refundable processing fees,
which shall be collected at the time of application form.
 Once the loan is sanctioned and the sanction letter is accepted by the customer,
the remaining processing fees shall be collected.
 The non refundable processing fees should be banked and realized before
sanction. The non clearance of non refundable processing fees shall amount to
rejection of case
 Processing fees should collected by cheque
 If cheque, then the cheque should be from the salary a/c of salaried customer
&main dealing current a/c self-employed customer
 If self-employed customer wishes to give processing fees from saving a/c, then
bank statement of the said a/c for 6months to be collected.

No cash to be accepted against Processing fees amount

22
KYC DOCUMENTS-INDIVIDUAL:

IDENTITY PROOF (Self attested ADDRESS PROOF (Self attested

copy of any one of the following copy of any one of the following)
1.Valid passport 1. Latest telephone bill
2. PAN card 2. latest electricity bill
3. Voters ID card 3. Bank account statement
4. Valid driving license 4. Letter from employer
5. Identity card (only govt. & PSU (government and public sector
employees) organizations)
6. Aadhar card (UID) 5. Copy of sale deed if self-owned
property or index II
6. Valid passport
7. Registered rent agreement

AGE PROOF (Self attested copy of any one of the following)

1. PAN card
2. Valid passport
3. Valid driving licence
4. School leaving certificate
5. Birth certificate

23
SIGNATURE PROOF (Self attested copy of any one of the following)

1. PAN CARD
2. Valid passport
3. Signature verification from the bank

KYC Documents-Non Individuals (all document should be self attested)

In case of Pvt. Ltd. Company (Income of the company, principal place of business,
mailing address of the company, telephone/fax number)

 Certification of incorporation
 Memorandom& Articles of Association
 Resolution from of directors
 Latest telephone bill

In case of Partnership Firm (Legal name, address, names of all the partners and
their addresses, telephone numbers of the firm and partners)

 Registration certificate, if registered

 Partnership deed (preferably registered)
 Latest telephone bill in the name of the firm/partners
 Power of attorney granted to a partner or an employee of the firm
to transact of the business on its behalf.

24
In case of Proprietorship Firm

 Telephone bill
 Shop & Establishment license
Or
VAT registration
Or
SSI registration
Or
Any other mandatory license/registration (As applicable)
 Copy of PAN card wherever applicable

25
PROCESSING OF LOAN APPROVAL
The process of lending goes through following steps:

HOME LOAN ELIGIBILITY ASSESSMENT

CONDITIONAL HOME LOAN SANCTION

SECURITY ASSESSMENT FOR PROVIDING HOME LOAN

HOME LOAN DISBURSEMENT

26
Step 1:
Home loan Eligibility Assessment

At this stage, we want to determine that you can afford the loan repayments. Our
credit team will conduct income verification and validate the accuracy of the
information you have provided. Further basis your income, our credit team will arrive
at an eligibility loan amount that you can avail from us.

A credit check will then be carried out to reveal your credit history; in this case we as
a lender will obtain a credit report that will show the following details:

 Personal details such as: Name, Residential Addresses, Date of Birth and PAN
card number

 Records of some recent credit accounts

 Overdue Accounts (Defaults) which may have been listed against your name,
including an indicator on whether the default amount has been paid or not

As your credit history plays an important part in the home loan application process, it
is always advisable to clarify and resolve any credit related issues before lodging your
loan application.

27
Step 2:
Conditional Home Loan Sanction

Considering there are no major issues with your income verification and credit
checks, we at DHFL will provide conditional sanction for your loan. This means that
we will issue a formal Letter of Offer cum acceptance favouring all the applicants to
the loan. We recommend all applicants read this document carefully, sign and return it
to us, making sure the information is correct and that everyone understands all the
terms and conditions.

Your DHFL Home loan executive will be there to guide you through this step and
assist you in compiling documents should we require any further information.

Step 3:
Security Assessment For Providing Home Loan

 Technical Assessment: A qualified technical officer will conduct a valuation

on the property you intend to purchase and any property that will be used as
security.
 Legal Assessment: A qualified lawyer will examine the property documents
i.e. chain of agreements/title etc to determine if the property documents
provided by you are conducive for lending.

Based on the technical and legal assessment report, we will determine if the property
is suitable for mortgage lending purposes

28
Step 4:
Home loan Disbursement

Once you have formally accepted our loan offer, a thorough scrutiny of all of the
above steps is conducted by our Operations Team to ensure accuracy of the entire
process. Once the final check is completed, you need to submit the final processing
fees cheque favouring “Dewan Housing Finance Corporation Ltd” to your DHFL
executive. After clearance of the final processing fees cheque, the disbursement
cheque for the approved amount is prepared by the Operations Manager and it is
handed over to you.

Upon receiving the funds you will start paying your first home loan repayment,
usually one month after the disbursement date.

29
 CHAPTER-4

DATA PRESENTATION, ANALYSIS AND INTERPRETATION

30
Housing Industry Overview

The growth of the Indian economy combined with the resultant rise in the per capita
income has stepped up the pace of urbanisation. This, along with the increasing
availability of Finance, has resulted in a growth in demand for housing in the past few
years. As per CRISIL estimates, the housing stock in India stood at ~148 million
during FY 2014, as compared to
Around 103 million a decade back. Further improvements in the macroeconomic
scenario, coupled with demographic changes in population such as changing age mix,
increasing nuclearisation of families, among others are expected to give an added
impetus to the growth of the housing industry in India.
The country’s housing finance companies maintained their asset quality as reflected in
a GNPA of 0.84% as at December 31, 2013. Correspondingly, profitability remained
largely stable for housing finance companies on account of an improvement in
Operating efficiencies and low credit costs. Mortgage penetration in India, as
compared to other countries

31
TABLE SHOWING FIGURE OF HOUSING LOAN SANCTIONED BY DHFL
FOR LAST 3 YEARS:

Financial Year 2011-12 2012-13 13-14

Amount of Housing Loan in 12845.31 17336.85 22377.61
Rs.(In crore)

GRAPH SHOWING HOUSIN LOAN FIGURE OF THE COMPANY FOR

LAST 3YEARS:

Rs. In cr.
25000

20000

15000

Rs. In cr.
10000

5000

0
2011-2012 2012-2013 2013/2014

INTERPRETATION:

During the year of 2011-2012 Amount of Housing Loan Rs 12845.31 cr,in the year
2012-13 Amount of Housing Loan Rs.17336.85 cr and in the year 2013-14 Amount of
Housing Loan Rs.22377.61 cr

32
TABLE SHOWING THE FIGURE OF LOAN BOOK OF DHFL
FOR LAST THREE YEAR

Financial Year 2011-12 2012-13 2013-14

Amount of Loan 19,355.38 33,901.72 40,596.63
Book In Rs(in
croe)

GRAPH SHOWING FIGURE OF LOAN BOOK OF THE COMPANY FOR

LAST 3YEARS:

45,000.00
40,596.63
40,000.00

35,000.00 33,901.72

30,000.00

25,000.00 2011-12
19,355.38 2012-13
20,000.00
2013-14
15,000.00

10,000.00

5,000.00

0.00
amt of loan in cr

33
TABLE SHOWING THE NUMBER OF EMPLOYEES IN DHFL FOR LAST 3
YEARS:

FINANCIAL 2011-12 2012-13 2013-14

YEAR
NO.OF 1,400 1,736 1,891
EMPLOYEES

GRAPH SHOWING THE NUMBER OF EMPLOYEES OF THE COMPANY

FOR LAST 3YEARS:

2000 1891
1800 1736

1600
1400
1400

1200
2011-12
1000
2012-13
800 2013-14
600

400

200

0
no.of employees

34
Comparison of Home loan Interest rates of DHFL with others
Nationalized Banks

Name DHFL State Bank Central Bank of ICICI

of India Bank of India
India
Up to 75 9.90% Woman- 10.25% 10.20% Salaried-
Lakhs 10.10% 10.25
Others- Self
10.25% employed-
10.25
Above75 9.90% Woman- 10.50% 10.45% Salaried-
Lakhs to 2 10.25 10.50%
Crore Other-10.30 Self
employed-
11.00%
Above 2 9.90%
Crore
Interpretation:-The DHFL has comparatively lower interest rates than other
nationalized Banks.

35
HOUSING LOAN CASE STUDIES ACCORDING TO INCOME
LEVEL OF BORROWER.

INCOME LEVEL- 1 to 10 Lakhs

CASE STUDY-1

Applicant: Mr. Ramesh Bhausaheb Patil

Co-Obligate: Mrs. Rupal Ramesh Patil

Date of Birth: 4/7/1983

DOB of Co-Obligate: 5/5/1987

Occupation: Business

Length of Profession: 7 Year

Length of Profession

Occupation of co-applicant: 5 Years

Loan Amount: 26.88 Lakhs

Date of Sanction: 17-5-15

Date of Disbursement: 25-4-15

Branch: Amravati Branch

Security: Equitable mortgage of flat

36
1. PROPOSED PROPERTY

Cost of Purchase: 33.60 Lakhs

Purchase of Loan: To purchase flat

Age Criteria: Age of applicant is less than 60 years

2. COST OF PROPERTY TO BE PURCHASED

Cost Rs. In Lakhs

A) Total cost of purchase 33.60 Lakhs
B) Other charges -
C) Stamp duty -
Total Cost 33.60 Lakhs

3. MEANS

A) Company Loan 26.88 Lakhs

B) Own contribution 06.72 Lakhs
Total means of finance 33.60 Lakhs

4. COMPUTATION BASED ON MARGINE REQUIRMENT

Eligibility of Finance

A) Cost of purchase flat 33.61 Lakhs

B) 80% of cost of construction 26.88 Lakhs

5. FOR BUSSINESS: Income + Depreciation as per ITR

Year 2012-13 2013-14 Gross Total

Applicant 1
(Rs. In Lakhs) 3.09 4.37 Avg 3.73
Applicant 2
(Rs. In Lakhs) 7.05 9.73 Avg 2.44
Total= 6.17
Average x 5
(Rs. In Lakhs) 6.17 x 5=30.85

6. AMOUNT OF LOAN APPLIED FOR RS.27.00 LAKHS

37
7. AS PER DEDUCTION NORMS

A) Existing deductions Rs.3700.00

B) Proposed Loan Installment Rs.27000.00
C) Total Deductions Rs.30700.00
D) Monthly income of both applicant Rs. 51400.00

The total deductions come to 59.72% which is the prescribed limit for ROI
9.90% i.e. existing company’s rates.

8. 80% of cost of flat- 26.88 Lakhs.

A) Maximum limit in urban area None

B) Maximum limit in view of margin 20% 26.88
C) Loan amount for/requested by applicant 27.00
D) amount equal to 5 times average income 30.85

Lower of above 26.88

38
 CASE STUDY-2

Applicant: Mr. Rohit Ramlal Fanse

Co-applicant: Mrs. Snehal Rohit Fanse

Date of Birth: 18/09/1978

Date of Birth of Co-applicant: 27/05/1972

Occupation: General surgeon (Dr)

Length of Profession: 8 Year

Business Office: Life care hospital, Sai Nagar Amravati

Loan Amount: 50.00 Lakhs

Branch: Amravati

Security: Equitable mortgage of bungalow

1. PROPOSED PROPERTY

Cost of Purchase: 61.00 Lakhs

Purchase of Loan: To purchase Bungalow

Age Criteria: Age of applicant is less than 60 years

2. COST OF PROPERTY TO BE PURCHASED

Cost Rs. In Lakhs

D) Total cost of purchase 61.00 Lakhs
E) Other charges -
F) Stamp duty 4.00 Lakhs
Total Cost 65.00 Lakhs

3. MEANS

A) Bank Loan 50.00 Lakhs

B) Own contribution 15.00 Lakhs
Total means of finance 65.00 Lakhs

39
4. COMPUTATION BASED ON MARGINE REQUIRMENT

Eligibility of Finance

C) Cost of purchase flat 65.00 Lakhs

D) 80% of cost of construction 52.00 Lakhs

5. FOR BUSSINESS: Income + Depreciation as per ITR

Year 2010-11 2011-12 2012-13 Total

Applicant 4.51 9.05 17.67 31.23/3=

(Rs. In Lakhs) 10.41 Avg

= 10.41 x 5(Avg x 5) = 52.05 Lakhs

6. AMOUNT OF LOAN APPLIED FOR RS.50.00 LAKHS

7. AS PER DEDUCTION NORMS

A) Existing deductions Rs.00.00

B) Proposed Loan Installment Rs.50000.00
C) Total Deductions Rs.50000.00

Monthly Income of applicant is = Rs.147250.00

The total deductions come to 34% which is the prescribed limit for ROI 9.90%
i.e. existing company’s rates.

8. 80% of cost of flat- 52.00 Lakhs.

E) Maximum limit in urban area None

F) Maximum limit in view of margin 20% 52.00
G) Loan amount for/requested by applicant 50.00
H) amount equal to 5 times of average income 52.05

The eligible loan amount is less of the above

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 CASE STUDY-3

Applicant: Mr. Girish Dilipkumar Daga

Co-Obligate: Mrs. Ankita Girish Daga

Date of Birth: 01/06/1972

Date of Birth of Co-Obligate: 27/03/1976

Occupation: Business

Length of Profession: 15 Years

Length of Profession Co-Obligate: 15 Years

Business Office: Daga Enterprises, opp. wonder city,

Badnera road, Amravati

Loan Amount: 75.00 Lakhs

Date of Sanction: 21/04/2014

Date of Disbursement: 30/04/2014

Branch: Amravati Branch

Security: Equitable mortgage of House

1. PROPOSED PROPERTY

Cost of Purchase: 102.40 Lakhs

Purchase of Loan: For construction of bungalow

Age Criteria: Age of applicant is less than 60 years

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2. COST OF PROPERTY TO BE PURCHASED

Cost Rs. In Lakhs

G) Total cost of purchase 102.40 Lakhs
H) Other charges -
I) Stamp duty -
Total Cost 102.40 Lakhs

3. MEANS

A) Bank Loan 75.00 Lakhs

B) Own contribution 27.00 Lakhs
Total means of finance 102.40 Lakhs

4. COMPUTATION BASED ON MARGINE REQUIRMENT

Eligibility of Finance

E) Cost of purchase flat 102.40 Lakhs

F) 80% of cost of construction 81.92 Lakhs

5. FOR BUSSINESS: Income + Depreciation as per ITR

Year 31/03/2011 31/03/2012 31/03/2013 Total

(Rs.In Lakhs) (Rs.In Lakhs) (Rs.In Lakhs) (Rs. In Lakhs)
Applicant’s Income 22.29 05.90 04.60
Depreciation 02.23 02.10 02.33 39.45
Co-applicant 07.40 08.12 05.75 21.27
= Total 31.92 16.12 12.68 60.72

6. AMOUNT OF LOAN APPLIED FOR RS.75.00 LAKHS

7. AS PER DEDUCTION NORMS

A) Existing deductions NA
B) Proposed Loan Installment Rs.75000.00
C) Total Deductions Rs.75000.00

Monthly Income of both applicant is = Rs.168700.00

The total deductions come which to be the prescribed limit for ROI 10.40% i.e.
existing bank rates.

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8. 80% of cost of flat- 81.92 Lakhs

I) Maximum limit in semi urban area 100.00

J) Maximum limit in view of margin 20% 81.92
K) Loan amount for/requested by applicant 75.00
L) amount equal to 60 times of net salary/70 NA
times of gross salary whichever higher(for
salaried)

The eligible loan amount is less of the above

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 CHAPTER - 5

FINDING AND CONCLUSION

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FINDINGS

 In case of public banks level of perception regarding the housing loan, gender,
age and educational qualification were dependent.
 From public banks majority of the respondents were female and in the case of
private banks respondents were male.
 Collateral taken to reduce the risk is far more than the actual loan amount.
 The DHFL takes into consideration the Character, Capacity and Condition
before sanctioning the Housing loan.
 DHFL has maintained Good Customer satisfaction.

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CONCLUSION
 From above research analysis got practical evaluation of Housing loans.
 DHFL has made centralize process for loans.
 As per my research DHFL at Amravati branch assess to customer very well
with feasible assessment.
 As per my research DHFL at Amravati has faster process than other banks for
sanctioning home loans.
 As per my observation company does not differ to customer there are all
customer equals to bank.

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SUGGESTIONS& RECOMMENDATIONS

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 The DHFL company should review the housing loan portfolio at periodical
intervals for capturing the new market to avoid risk and for updating their
schemes. .
 Branches of DHFL can arrange customers meeting to popularize these lend
schemes.
 The DHFL can think of opportunities marketing agents for housing loans as is
being done by financial institutions. At the apex level a lot of publicity can be
given on the advantages of bank loans.
 Opening a special housing branch and posting field officers for housing
finance in intensive areas with a view to tap the business potential and to serve
the clientele on a Continuous basis may be helpful.
 All employees should be familiar with the details of the housing loan schemes
of DHFL.
 The system of changing a reduced rate of interest based on the credit rating of
the borrowers may be introduced in housing loan schemes. –
 All information regarding housing loans should be available on the website of
company’s in an interactive mode.
 Loan application forms should be simplified.

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BIBLIOGRAPHY

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Bibliography:-
1. www.dhfl.com
2. www.Wikepidia.com
3. www.google.com

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