housing finance

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comaprision between three comanies i.e. hdfc, sbi, lic

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Housing Development Finance Corporation Limited (HDFC) Housing Development Finance Corporation Ltd (HDFC) is one of the leaders in the Indian housing finance market with almost 17% market share as on March 2010. Serving more than 38 lakh Indian customers as on March 2011, HDFC also offers customized solutions that fit to the need of the customer. In the FY 2010-11, it registered a net profit of `4528.41 crore. It also registered a net profit of ` 971 crore in the quarter ended September 30, 2011.



State Bank of India Home Finance (SBI) State Bank of India is another major player in the Indian housing finance market with 17% of the market share, same as HDFC's share as on March 2010. The SBI Housing Loan schemes are specifically designed to meet the varied requirements of the customers. It offers home loan for various purposes including new house/flat, purchase of land, renovation/alteration/extension of existing house/flat etc. SBI Home Finance registered a net profit of ` 24.63 crore in the year ended March 31, 2009.



LIC Housing Finance Limited LIC Housing Finance is another major player in housing finance sector in India with about 8% of market share. Promoted by Life Insurance Corporation of India, LICHFL has an extensive distribution network with a strong brand presence. Recently, the company has been awarded “Consumer Superbrand 2009/10 Status” by Superbrands Council. In the last financial year (ended on March 31, 2011), LICHFL earned a net profit of ` 974.49 crore, comparing to ` 662.18 in the previous FY. It also registered a net profit of ` 256.50 crore in April- June quarter of 2011.

Name HDFC LIC Housing Fin Competition

Last Price 775.65 247.85

Market Cap. (Rs. cr.) 119,493.51 12,508.07

Sales Turnover 17,332.94 6,114.86

Net Profit 4,122.62 914.20

Total Assets 115,001.56 53,552.12

INTRODUCTION In pursuance of National Housing Policy of Central Government, Reserve Bank of India has been facilitating the flow of credit to housing sector. During last three years, the housing sector has emerged as one of the sectors attracting a large quantum of bank finance. The current focus of RBI's regulation is to ensure orderly growth of housing loan portfolio of banks 2. DIRECT HOUSING FINANCE 2.1 Direct Housing Finance refers to the finance provided to individuals or groups of individuals including co-operative societies. 2.2 Banks are free to evolve their own guidelines with the approval of their Boards on aspects such as security, margin, age of dwelling units, repayment schedule, etc. 2.3 Other Guidelines The following types of bank finance may be included under Direct Housing Finance: (i) Bank finance extended to a person who is already owning a house in town/village where he resides, for buying/ constructing a second house in the same or other town/ village for the purpose of self occupation. (ii) Bank finance extended for purchase of a house by a borrower who proposes to let it out on rental basis on account of his posting outside the headquarters or because he has been provided accommodation by his employer. (iii) Bank finance extended to a person who proposes to buy an old house where he is presently residing as a tenant. (iv) Bank finance granted only for purchase of a plot, provided a declaration is obtained from the borrower that he intends to construct a house on the said plot, with the help of bank finance or otherwise, within such period as may be laid down by the banks themselves (v) Supplementary finance (a) Banks may consider requests for additional finance within the overall ceiling for carrying out alterations/ additions/repairs to the house/flat already financed by them. (b) In the case of individuals who might have raised funds for construction/ acquisition of accommodation from other sources and need supplementary finance, banks may extend such finance after obtaining pari passu or second mortgage charge over the property mortgaged in favour of other lenders and/or against such other security, as they may deem appropriate. 5 3. INDIRECT HOUSING FINANCE 3.1 General Banks should ensure that their indirect housing finance is channelled by way of term loans to housing finance institutions, housing boards, other public housing agencies, etc., primarily for augmenting the supply of serviced land and constructed units. It should also be ensured that the supply of plots/houses is time bound and public agencies do not utilise the bank loans merely for acquisition of land. Similarly, serviced plots should be sold by these agencies to co-operative societies, professional developers and individuals with a stipulation that the houses should be constructed

thereon within a reasonable time, not exceeding three years. For this purpose, the banks may take advantage of various guidelines issued by NHB for augmenting the supply of serviced land and constructed units.

HOUSING LOANS UNDER PRIORITY SECTOR 4.1 The following housing finance limits will be considered as Priority Sector Advances: 4.1.1 Direct Finance (i) Loans up to Rs. 15 lakh in rural, semi-urban, urban and metropolitan areas for construction of houses by individuals, with the approval of their Boards. (ii) Loans up to Rs.1 lakh in rural and semi urban areas and Rs. 2 lakhs in urban areas for repairs to damaged houses by individuals. (iii) Loans granted by banks in rural areas under the Special Rural Housing Scheme of NHB will also be considered as part of priority sector advances subject to the limits specified under (i) and (ii) above i.e. upto Rs. 15 lakhs for acquiring/ construction of a new house and upto Rs. 1 lakh for repairs/ upgradation of an existing house. 4.1.2 Indirect Finance (i) Assistance given to any governmental agency for construction of houses, or for slum clearance and rehabilitation of slum dwellers, subject to a ceiling of Rs. 5 lakh of loan amount per housing unit. (ii) Assistance given to a non-governmental agency approved by the National Housing Bank for the purpose of refinance for reconstruction of houses or for slum clearance and rehabilitation of slum dwellers, subject to a ceiling of Rs. 5 lakh of loan amount per housing unit. 4.1.3 Investments in Bonds Investments already made by banks upto March 31, 2005 in the special bonds issued by specified institutions, including inter alia, NHB and HUDCO shall not be eligible for classification under priority sector lending with effect from April 1, 2006. The investments that may be made by banks on or after April 1, 2005 in the bonds issued by NHB and HUDCO shall not be eligible for classification under priority sector lending.

LIC Green Channel - For Professionals This facility is meant for Professionals like Practising Doctors, Chartered Accountants, Cost Accountants, Executives holding IIM diplomas and Computer Engineers. Loans can be applied under any of the usual Schemes. A one-time processing and Administrative fee(non-refundable) @ 1.0% of loan applied for, is payable. Inspection of Property and title clearances are undertaken simultaneously, as soon as the loan is sanctioned. This facilitates quicker disbursment of loan.

Collateral security of LIC Policy upto the extent of 50% of the loan amount is sufficient.

Step- up EMI Facility This facility is extended, keeping in view the prospective increase in income of the Borrowers, and is available to people who have good prospect of future increase in income, viz., young Professionals/Executives who are less than 35 years of age. This facility envisages flexible mode of repayment through Stepping up of EMI during the tenure of loan. Under this Facility, the EMI will initialy be fixed at a lower amount; this would be changed twice (i.e., on the 6th and the 11th year) during the Loan Tenture (15 years); the rate at which the EMI will be steppedup in the 6th and 11th years would be at 10/15/20 % of the initial EMI as preferred by the Applicant.

For NRIs in Gulf Countries LIC Housing Finance Ltd., Representative Office, Dubai / Kuwait is authorised to sanction loans in principle, based on the repaying capacity of the applicants. However the disbursement of such loans will be made in India. Please refer to Griha Shobha Scheme for details of loans to NRIs.

HDFC Home Loan Advantages
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Counselling and advisory services for acquiring a property Instant Home Loan Approval Widest range of home loan products & services like Home Loans, Home Improvement Loans, Home Extension Loans, Loans to professionals for office or clinic, Home Equity Loans (Loan against Property), Short Term Bridging Loan etc. Loan from any office for purchase of home anywhere in India Loan approval even before a property is selected Flexible loan repayment options like Step Up Repayment Facility, Flexible Loan installments Plan, Tranche Based EMI, Accelerated Repayment Scheme Vast network of over 322 in India, offices in Singapore, London & Dubai and franchises in the Gulf Cooperation Council (GCC) region. Click here to find the nearest HDFC Office. Most experienced and empowered personnel to ensure smooth & easy processing Free & safe document storage Online loan application facility



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A new home brings with it new hopes, joys and emotions. At HDFC, we have shared new hopes, joys and emotions with over 4.02 million customers. Every customer has a specific and unique concern. Having earned an experience of over 34 years in home loans, Our home loan product is customised to provide you solutions for your unique concern. Features Maximum loan 80% of the cost of the property (including the cost of the land) and based on the repayment capacity of the customer. Maximum Term 20 years subject to your retirement age. Applicant and CoApplicant to the loan Home Loans can be applied for either individually or jointly. Proposed owners of the property, will have to be co-applicants. However, the coapplicants need not be coowners. Adjustable Rate Home Loan Loan under Adjustable Rate is linked to HDFC's Retail Prime Lending Rate (RPLR). The rate on your loan will be revised every three months from the date of first disbursement, if there is a change in RPLR, the interest rate on your loan may change. However, the EMI on the home loan disbursed will not change*. If the interest rate increases, the interest component in an EMI will increase and the principal component will reduce resulting in an extension of term of the loan, and vice versa when the interest rate decreases. * Conditions Apply Interest Rate Wef : 1st Oct 2012 Applicable Variable rates % ( Monthly Rest Basis ) 10.25% to 10.75% 10.50% to 11.50% RPLR: 16.50% Basis : RPLR minus Spread RPLR - 6.25% to 5.75% RPLR - 6.00% to 5.00%

Loan Slabs Upto and including Rs 30 lacs Over Rs. 30 lacs

The above rates are subject to change without notice.


TruFixed Home Loan Under this product the customer has the option to choose a Fixed Interest Rate Period (FIRP) between 3 to 10 years . Post the fixed rate period the loan will automatically convert to a variable rate product. The customer also has the option, subject to our eligibility norms to take a complete fixed rate term product for a fixed term of 3 to 10 years. Or, he can avail a long term loan of 15 to 20 years with a part fixed and part floating for the entire tenor of the loan. The full disbursement of the loan, irrespective of the fixed period chosen, shall have been availed within the first 3 years from the date of first disbursement of the loan. Post the fixed rate period the interest rates applicable on the loan shall be the then applicable HDFC RPLR minus the spread as applicable currently on the loan amount being availed under this product. The applicable interest rates in the Fixed Interest Rate Period (FIRP) are linked to sanctioned loan amount and as per details given below: Interest Rates during the Loan Slabs Fixed Interest Rate Period ( % ) Upto and including Rs 10 lacs Rs.10.01 lacs to Rs.75 lacs Over Rs.75 lacs 10.75 11.00 11.25



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Eligibility The product is available to salaried and self-employed customers subject to file being logged in on or before November 30th 2012 with an end date for the first disbursement on or before December 31st 2012. Purpose Purchase of Flat, row house, bungalow from developers Existing freehold properties Properties in an existing or proposed co-operative housing society or apartment owner's association First Power of Attorney purchases in Delhi for DDA flats allotted before 1992.

Sbi

HOME LOANS - INTEREST RATES With effect from 20.09.2012 [Print Page] All Rate are floating only (Base Rate= 9.75% p.a.) Loan Amount Linkage with Base Effective Rate Rate over the tenor of the loan Upto Rs. 0.25% Rate above Base 10.15% p.a. above Base 10.00% p.a.

30.00 lacs

Above Rs. 0.40% 30.00 lacs Rate

No fixed rate option in any limit bracket.

FEATURES [Print Page] Eligibility: Minimum age: 18 years as on the date of sanction Maximum age: 70 years. i.e. the age by which the loan should be fully repaid, subject to availability of sufficient, regular and continuous source of income for servicing the loan repayment. Loan Amount: Actual loan amount will be determined taking into consideration such factors as applicant’s income and repaying capacity, age, assets and liabilities, cost of the proposed house/flat etc. To enhance loan eligibility you have option to add: 1) Income of your spouse/ your son/ daughter living with you, provided they

have a steady income and his/ her salary account is maintained with SBI. 2) Expected rent accruals (less taxes, cess, etc.) if the house/ flat being purchased is proposed to be rented out. Depreciation, subject to some conditions. Regular income from all sources.

3) 4)

Security: Equitable mortgage of the property

Margin/ LTV Ratio: Loan Amount Upto Rs. 20 Lacs Margin (Min.) Maximum LTV Ratio (Max.) 10% 90% 80%

Above Rs. 20 Lacs. 20%

LIC COMPANY PROFILE LIC Housing Finance Ltd. is one of the largest Housing Finance company in India. Incorporated on 19th June 1989 under the Companies Act, 1956, the company was promoted by LIC of India and went public in the year 1994. The Company launched its maiden GDR issue in 2004. The Authorized Capital of the Company is Rs.1500 Million (Rs.150 Crores) and its paid up Capital is Rs.850 Millions (Rs.85 Crores). 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. The main objective of the Company is providing long term finance to individuals for purchase / construction / repair and renovation of new / existing flats / houses. The Company also provides finance on existing property for business / personal needs and gives loans to professionals for purchase / construction of Clinics / Nursing Homes / Diagnostic Centres / Office Space and also for purchase of equipments.

The Company possesses one of the industry's most extensive marketing network in India : Registered and Corporate Office at Mumbai, 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 its marketing reach. Back Offices spread across the country conduct the credit appraisal and administrative functions. 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.

'HDFC' - a household name that Indians proudly reckon with! Housing Development Finance Corporation Limited (HDFC Ltd.) was established in 1977 with the primary objective of meeting a social need of encouraging home ownership by providing long-term finance to households. Over the last three decades, HDFC has turned the concept of housing finance for the growing middle class in India into a worldclass enterprise with excellent reputation for professionalism, integrity and impeccable service. A pioneer and leader in housing finance in India, since inception, HDFC has assisted more than 4.02 million customers to own a home of their own, through cumulative housing loan approvals of over Rs. 4.63 trillion and disbursements of over Rs. 3.74 trillion as at March 31, 2012. HDFC has a wide network of 322 offices (which includes 77 offices of HDFC's wholly owned distribution company HDFC Sales Private Limited) catering to over 2,400 towns & cities spread across the country. It also has offices in Dubai, London and Singapore and service associates in the Middle East region, to provide housing loans and property advisory services to Non-Resident Indians (NRIs) and Persons of Indian Origin (PIOs). HDFC's unrelenting focus on Corporate Governance, high standards of ethics and clarity of vision, percolate through the organization. Trust, Integrity, Transparency and Professional Service are the important pillars of the brand HDFC and most importantly, people - both employees and customers - are its brand ambassadors. Customer satisfaction is the hallmark of all HDFC offerings. The first touch of HDFC's personalised service begins as soon as a customer

approaches HDFC, and over time it progresses into a long and meaningful relationship. State-of-the-art information systems supported by strong in-house training programmes conducted at its specialized training centre in Lonavla, have equipped HDFC to respond swiftly to the ever-changing customer needs and thereby empower customers in making the right home buying decision. This is what sets apart HDFC's customer service philosophy - 'With You, Right Through'. HDFC's specialist team of over 1,700 (as on 31st March, 2012) trained and experienced professionals follows a 'single-window concept' for providing smooth and value added services at all stages. The team guides the customers right through the entire process of property purchase - be it property search assistance, technical support prior to finalising the property, legal advice on property related documentation, personalised home loan counseling or providing tailor-made repayment options to suit the customer's specific requirements. HDFC's wide product range includes loans for purchase and construction of a residential unit, purchase of land, home improvement loans, home extension loans, non-residential premises loans for professionals and loan against property, while its flexible repayment options include Step Up Repayment Facility (SURF) and Flexible Loan Installment Plan (FLIP). HDFC also has a robust Deposits mobilisation programme. HDFC has been able to mobilise deposits from over 14 lakh depositors. Outstanding deposits grew from Rs. 1,458 crores in March 1994 to Rs 36,569 crores in March 2012.In addition, HDFC has received 'AAA' rating for its Deposit products for highest safety from both CRISIL and ICRA for eighteen consecutive years. Over the years, HDFC has emerged as a financial conglomerate with its presence in the entire gamut of financial services including banking, insurance (life and non-life), asset management, real estate venture capital and more recently education loans. Today, HDFC is recognised as one of the Best Managed Companies in India and is a model housing finance company for developing countries with nascent housing finance markets. HDFC has undertaken several consultancy assignments in various countries across Asia, Africa and East Europe to support and establish their housing finance institutions. At HDFC, 'Corporate Social Responsibility' has always been an evolving concept, akin to its 'learning by doing' philosophy. As part of its social objectives, HDFC has always endeavoured to contribute to economic development and social upliftment of the weaker sections of society and

has professionally nurtured each of its social initiative as an investment. HDFC has undertaken development oriented work and supported several social initiatives in the areas of education, child welfare, medical research, welfare for the elderly and the handicapped among several others. HDFC is how millions of Indian families spell the word 'Home' as the brand not only offers Housing Finance, but also Total Housing Solutions. The HDFC Advantage
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Pioneers of Housing Finance in India with over 34 years of lending experience. Widest range of home loan & deposit products. Vast network of over 322 interconnected offices which includes 3 international offices. Most experienced and empowered personnel to ensure smooth & easy processing. Online loan application facility at www.hdfc.com and across-the-counter services for new deposits, renewals & repayments. Counseling and advisory services for acquiring a property. Flexible loan repayment options Free & safe document storage. WELCOME to SBI Home Loans "THE MOST PREFERRED HOME LOAN PROVIDER" voted in AWAAZ Consumer Awards along with the MOST PREFERRED BANK AWARD in a survey conducted by TV 18 in association with AC Nielsen-ORG Marg in 21 cities across India. SBI HOME LOANS now offers Interest Rates concessions on GREEN HOMES in accordance with SBI's commitment to Environment protection. SBI Home Loans come to you on the solid foundation of trust and transparency built in the tradition of State Bank of India. Best Practices followed in SBI mentioned below will tell you why it makes sense to do business with State Bank of India.

SBI Home Loans Unique Advantage

Package of exclusive benefits.  Low interest rates. Further, we charge interest on a daily reducing balance!!  Low processing charges.  No hidden costs or administrative charges.  No prepayment penalties. Reduce your interest burden and optimally utilize your  surplus funds by prepaying the loan. Over 13,700 branches nationwide, you can get your Home Loan account parked at a  branch nearest to your present or proposed residence.

HDFC HOUSING FINANCE SERVICES
 HOME LOAN It is important to choose a good housing finance company which can handhold the customer right through his home buying process. Since a home loan is a long term commitment of 15-20 years, several factors like expertise, quality of service, in-depth domain knowledge and the company’s level of commitment and transparency right through, the loan procedures, the fine print, quality of services offered and safe retrieval of the title deed are critical.

 Home Improvement Loans
The interiors of any home reflect the personal preferences and tastes of its owners making it imperative to constantly upgrade to keep up with changing times. With HDFC's Home Improvement Loans you can now renovate your existing space for a more comfortable environment and a better quality of living. This renovation loan facilitates internal and external repairs and other structural improvements like Painting, Waterproofing and Roofing, Plumbing and Electrical Works,

Tiling and Flooring, Grills, Aluminum Windows compound walls and much more.
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Purpose External repairs Tiling and flooring Internal and external painting Plumbing and electrical work Waterproofing and roofing Grills and aluminum windows Waterproofing on terrace Construction of underground/overhead water tank Paving of compound wall (with stone/tile/etc.) Borewell Maximum loan 80% of the cost of improvement. This is however subject to valuation of the property as assessed by HDFC. Subject to market value of the property Maximum Term 15 years subject to your retirement age Applicant and Co- Applicant to the loan Home Loans can be applied for either individually or jointly. Proposed owners of the property, will have to be coapplicants. However, the co-applicants need not be coowners. Adjustable Rate Home Loan Loan under Adjustable Rate is linked to HDFC's Retail Prime Lending Rate (RPLR). The rate on your loan will be revised every three months from the date of first disbursement, if

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there is a change in RPLR, the interest rate on your loan may change. However, the EMI on the home loan disbursed will not change*. If the interest rate increases, the interest component in an EMI will increase and the principal component will reduce resulting in an extension of term of the loan, and vice versa when the interest rate decreases. * Conditions Apply

 Home Extension Loans
HDFC provides Home Extension Loans for adding more space to your existing home for meeting the requirements of your growing family be it an extra bedroom for your children, a reading room for yourself or a cozy coffee corner. We make it easy to extend your home anyway you like.
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Purpose HDFC Home Extension Loan makes it convenient for you to extend or add space to your home. Be it an additional room, a larger bathroom, or even enclosing an open balcony.

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Maximum loan 80% of the cost of extension. This is however subject to valuation of the property as assessed by HDFC. Maximum Term 20 years subject to your retirement age Applicant and Co- Applicant to the loan Home Loans can be applied for either individually or jointly. Proposed owners of the property, will have to be coapplicants. However, the co-applicants need not be coowners.

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Adjustable Rate Home Loan Loan under Adjustable Rate is linked to HDFC's Retail Prime Lending Rate (RPLR). The rate on your loan will be revised every three months from the date of first disbursement, if there is a change in RPLR, the interest rate on your loan may change. However, the EMI on the home loan disbursed will not change*. If the interest rate increases, the interest component in an EMI will increase and the principal component will reduce resulting in an extension of term of the loan, and vice versa when the interest rate decreases.

 Land Purchase Loans HDFC provides Land Purchase Loans to Resident Indians to enable the purchase of a plot for the construction of residential premises.
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Maximum loan 80% of the cost / value of the land. This may be restricted to 70% of the cost / value of the land, if the land is located outside the city limits. This is however subject to valuation of the land as assessed by HDFC. Maximum Term 15 years subject to your retirement age. Applicant and Co- Applicant to the loan Home Loans can be applied for either individually or jointly. Proposed owners of the property, will have to be co-

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applicants. However, the co-applicants need not be coowners.
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Adjustable Rate Home Loan Loan under Adjustable Rate is linked to HDFC's Retail Prime Lending Rate (RPLR). The rate on your loan will be revised every three months from the date of first disbursement, if there is a change in RPLR, the interest rate on your loan may change. However, the EMI on the home loan disbursed will not change*. If the interest rate increases, the interest component in an EMI will increase and the principal component will reduce resulting in an extension of term of the loan, and vice versa when the interest rate decreases.

 Top - Up Loans
This product offers an existing resident Indian customer a loan against the mortgage of the existing property. It helps in encashing the investment in a house without having to dispose it off to fund various needs related to Higher Education, Purchase of Furniture, Business Requirements, etc. The maximum loan amount under this product is 70% of the market value of the property less the outstanding loan and is subject to the current loan eligibility. The maximum term of the loan is 10 years. Top up loans can given after 1 to 2 years [based on our discretion], of the final disbursement

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