1.

1INTRODUCTION TO INDUSTRY
Financial Industry in India is growing at a rapid speed. There are many changes made in financial
industry so that more people can avail the benefits. They are the industries which provided us financial
services. Aadhar Housing Finance Ltd. Is one of them it is a fast growing industry. There are many
competitors of Aadhar Housing Finance which are present not only in India but in foreign countries also.
For example:

 ICICI Bank
 HDFC Bank
 AXIS Bank
 PNB Housing
 STATE Bank of India, etc

These companies give a strong competition to Aadhar Housing Finance LTD. Therefore we can say that
there are many types of financial industries in India. The finance industry is an industry in itself as well
as auxiliary which support the other industry. Without finance industry trade and commerce across the
world could not done because for trading we need huge money and this money is provided by the
finance industry.

The Banking & Financial Services industry serves an important role in the whole economy. By
facilitating movement of money from people or organizations with surplus capital to people or
organization who need money , financial intermediaries help power, innovation and growth, creating
jobs, building new ideas, jobs and funds. Individuals tend to borrow money more early in life. (paying
college fees) but invest more later in life ( to build wealth and save for retirement). Financial
intermediaries offer a service to help an individual to save or borrow money.

 Retail Banks-It provide facilities to its customer like providing local people or providing debit
card, credit card ATM cards, etc so that the people can carry large amount of money in single
card i.e. plastic cards these are used to make digital payment.
 Corporate banks-It provides a wide range of services to companies, institutions and
governments. They provide facilities like mergers, acquisitions, privatizations, lending, initial
public offerings, shares, bonds etc.

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  Investment banks-It buy and sell newly issued shares.
 Financial trader-It buys and sells assets, shares and bonds for investors, including individual
and banks. They also make price and execute trades, seeking to minimize financial risks or to
maximize assets.

Banks earn their revenues by difference between the interest they charge from borrowers and the interest
they give to the lenders. If you have $2000 in your current account you will likely to get 0.1% interest
and if you want to need $2000 from bank you will likely to charge 10% as a interest. The interest you
pay is determined by your creditworthiness; the likelihood attached to your ability to repay your loans.

In the financial crisis of 2007-2008, the financial sector was one of the hardest hit with companies such
as Lehman Brothers filing for bankruptcy. After an influx of government regulation and restructuring,
the financial sector is considerably stronger in 2016. Economists often tie overall health of the economy
with the health of the financial sector. If financial companies are weak, this is detriment to the average
consumer. Financial companies provide loans for businesses, mortgages to homeowners and insurance
to consumers. If these activities are prohibited, it shows growth in both small business and real estate.
The financial industry performs many types of businesses including managing money, and it act a vital
intermediary role in the globe’s economy. The industry as a whole is a vast and includes companies
engaged in activities such as lending, trading and issuance, investing, asset management, advising,
foreign exchange, accounting and more. Because of large and diverse landscape, the financial services
industry offers a wide range of career options.

Factors Affecting the Financial Sector

Some of the positive factors that affect the financial sectors are:

 Rising interest rate:

As rate rises, it means that these companies can earn more on the money they have and on credit
they issue to their customers.

 Reducing regulation:
Whenever the government decides to cut back on the red tape, members of the financial sector will
benefit, because it implies it could lessen the burden while increasing profits.

 Helping consumers with finances:

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As consumers decreases their debt loads, they decrease the risk of defaults. This lessen loads also
means they may have a tolerance for more debt, further increasing profitability.

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 1.2 INTRODUCTION TO COMPANY

AADHAR HOUSING FINANCE LTD.

Figure-1.1: AADHAR LOGO

Aadhar housing finance ltd. (Aadhar), formerly known as DHFL Vyasa Housing Finance Ltd, is one of
the largest affordable housing finance companies in India servicing the home financing needs of the low
income sections of the society. Aadhar attempts to empower undeserved millions to own their first
home.
The Aadhar Housing Finance Limited (AHFL) was incorporated in 2010 and later amalgamated with
DHFL Vysya w.e.f 20th November, 2017& subsequently name changed to Aadhar Housing Finance
Limited. Formed with the merger of DHFL Vysya and Aadhar Housing Finance, Aadhar is one of the
few players in the industry with a pan India presence. Today, it provide solutions for finance needs to all
segments of customers whose monthly income is between INR 5000 (USD 76) to INR 50000 (USD 765)
and above. It is efficiently and effectively managed and supported by the acquaintance, expertise &
guidance of more than 700 employees. Because own home is still a dream for many. They fulfill theirs
needs at most reasonable offers.

AADHAR BOUQUET OF SERVICES

 HOME LOANS
 GENERAL LOANS
 GENERAL INSURANCE
 LIFE INSURANCES
 DEPOSITS

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VISION OF AADHAR HOUSING FINANCE:

“To Enable Home Ownership For Every Indian Across The Nation.”

VALUES: CITE -1

 Customer delight
 Innovation
 Integrity
 Excellence
 Trust
 Speed

MISSION

 To focus on lower income class.

 To provide valuable financial services at reasonable rates.
 To go one step further in serving customers, providing a sense of security and creating customer
delight.
 To enlarge network to every corner of the nation and widen the net of financial and economic
inclusion.
 To speak the language of respect, dignity, and courtesy with every customer.

COMPANY’S DETAIL

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 TABLE-1.1: COMPANY’S DETAILS

Company Name AADHAR HOUSING FINANCE LIMITED

Company Status Amalagamated

RoC RoC- Banglore

Company category Company limited by shares

Company Sub Category Non-govt company

Class of Company Public

Date of Incorporation 03 May 2010

Age of Company 9 years

Activity Other financial intermediation.

BOARD OF DIRECTORS

TABLE -1.2:BOARDS OF DIRECTORS

1. Shri Deo Shankar Tripathi

(Managing director & CEO)

2. Shri Sridar Venkatesan
( Independent Director)
3. Dr. Nivedita Haran
(Additional Director)
4. Shri Rishi Anand
(Chief Business Officer)
CORPORATE SOCIAL RESPONSIBILITY

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The Company believes in engaging and giving back to the community in a good and in line with the
Companies commitment to philanthropy. It intends to undertake the CSR activities strategically,
systematically and more thoughtfully and to move from institutional building to community
development through its various CSR programs and projects. It mainly focus on:

 Education
 Micro Finance and Macro Insurance
 Orphan and Destitute care

It also believes that it can contribute to the common cause of the society by bringing in the same
level of corporate efficiency in the administration and management of the various CSR initiatives.
They believes on the theory that “If the managers of our major institutions, and especially of
business, don’t take responsibility for the common good, no one else can or will”

"Corporate responsibility is simply a way for companies to take responsibility for the social and
environmental impacts of their business operations," said Jen Boynton, vice president of member
engagement at 3BL Media. "A robust CSR program is an opportunity for companies to demonstrate
their good corporate citizenship … and protect the company from outsized risk by looking at the
whole social and environmental sphere that surrounds the company."

"CSR creates a filter for the actions of a company," said Wendy Burk, CEO of Cadence Travel. "It
keeps organizations accountable and ethical."But consumers aren't the only ones who are drawn to
businesses that give back. Susan Cooney, head of global diversity, equity and inclusion at Symantec,
said that a company's CSR strategy is a big factor in where today's top talent chooses to work.

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 1.3INTRODUCTION TO THE TOPIC
Housing is a basic human need next in importance only to food and clothing. A first priority for a
youngster who begins life is therefore to plan a house. It is a place where one can relax after returning
home from day’s tiring work. It is a place where everyone give time to his/her family and spend
beautiful moments with family members. It is a fundamental demand for living and one of the key peace
and happiness. Housing is a major expenditure and cannot be funded by normal income or savings. The
prospective homeowner must look for a loan, so structured that he can repay it over a longer period of
time, in most cases almost one’s entire working life.
For this AHFL offer loan to the people to purchase or build a new house on the basis of his/her
eligibility and the bank lending rules. One of the most important benefits of taking a home loan from
AHFL is the interest rate that is allowed on the home loan. Fixed & Variable both interest rate options
are also available for home loans. Aadhar Housing Finance ltd. Also offer loan for home improvement
loans at the same interest rates as they offer the home loans.

LOAN:
Loan is an act of lending. Like all debt instruments, a loan implies the redistribution of financial assets
over time, between the lender and the borrower. In a loan agreement the borrower initially receives an
amount of money, called the Principal Amount, from the lender and obligated to pay back on repay an
equal amount of money to lender at later time. The amount of money paid back to the lender is in
regular installments or partial repayments, on an annual basis, each installments being of same amount.
There is no sureness about how loans started, but one can easily presume that ever since the concept of
ownership came into existent, people have been using lending and borrowing. Various types of loan are:

TYPES OF LOAN:
There are various types of loan which a financial institutions provides. They are:
 Personal loan
 Credit card loan
 Home loans
 Car loans
 Two wheeler loans

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 Education loans
 Loan against the insurance schemes
 Loan against fixed deposits
 Loan against mutual funds and shares

HOME LOANS
Home loan is fund which a buyer borrows from a bank or any financial institutions to purchase a
property, generally secured, by a registered mortgage to the bank over the property being purchased. A
mortgage loan is a debt owed on a home, the mortgage rate is the interest rate charge to the home owner
for the use of loan amount.
Home finance is a broad topic, the concept of which may vary across continents, regions and
countries, particularly in terms of area it covers. For example, term “housing finance” may be
understood differently in developed country than in a developing country.
The International Union for Housing Finance, as a multinational networking organisation, has no
official position on what the best definition of housing finance is. However, the selection of quotes
below is offered as a snapshot of what housing finance as a topic covers:
“Housing finance brings together complex and multi-sector issues that are driven by constantly changing
local features, such as a country’s legal environment or culture, economic makeup, regulatory
environment, or political system.”
– Loic Chiquier and Michael Lea
HOME LOAN EXTENSION & IT SCHEMES
The various types of home loans extension that are generally available are:
 Land purchase loan
These loans are given by bank or non- banking financial companies to purchase a plot or land on which
the loan applicant is looking to construct a house. Generally bank lends up to 80-85% of the price of the
plot or land.

 Home purchase loan

This loan amount is utilized to purchase a residential property. Financial institutions generally provide
up to 80-85% of the market value of the house as loan amount. The interest rate on these loans is either
fixed or floating.

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 Home construction loan
Financial institutions give home loans to applicants who want to construct a house on a land owned or
co-owned by them. The loan application and approval process for this loans are different in some
aspects than from the other available housing loans.

 Home extension loans

This loan is taken by individuals who want to extend or expand their existing house. Few institutions
differentiate this loan based on the purpose of expansion of the current house. For example: addition of
an extra room.

 Home improvement loans

Home improvements loans are taken by individuals who own a house, and want to renovate it but lack
of fund. Renovation includes- electrical wiring, repairs to existing house, painting of the walls, etc.

 NRI home loans

NRI home loans are specialized type of home loans that helps non resident Indians in buying residential
property in India. Though the procedure followed for applying this home loans and the paperwork is a
bit more.

 Home conversion loans

Existing home-loan borrowers who wish to move into another house can avail a home conversion loan
to buy a house.

AADHAR HOUSING FINANCE Ltd. LAND LOANS:

FIGURE-1.2: AHFL LAND LOAN

A land is a good investment when you have huge amount of money and it is most suitable for long-term
investments. A land loan is provided by various public and private banks with certain terms and
conditions for availing it. A notable point here is borrower has to clarify the date within which he will

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start the construction of his home and he can only use the loan for residential purpose only not for
agriculture or any other commercial purpose.
Aadhar housing finance limited, one of the largest financial companies in India provide loans to varied
customers for purchase of land. Salaried and self-employed professionals who fulfil the eligibility
criteria can obtain loan from Aadhar Housing Finance ltd.

Key features of Aadhar Housing Land Loans

TABLE-1.3: FEATURES OF LAND LOAN
Loan Tenure Up to 20 years
Loan Amount Up to INR 1 crore
Interest Rate Fixed at the sole discretion of bank
Margin 30% (minimum)
Age limit Up to 65 at the time of maturity

Aadhar Housing Finance Land Loan Eligibility Criteria

To eligible for land loan, one must be either salaried or self employed professional. The loan amount is
determined by the repaying ability of the borrower. If the borrower earns more and has existing loans,
the loan amount will be fixed accordingly.

AADHAR HOUSING FINANCE LTD HOME PURCHASE LOAN:

FIGURE-1.3: AHFL HOME PURCHASE LOAN

In today world, buying a home self financed is like impossible. Buying home from current income and
savings is very difficult. For this many banks/Companies start give Home Purchase Loan. A Purchase
money loan is a type of mortgage loan used by borrower to buy a home.

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Aadhar Housing finance ltd. also offers home purchase loan to the customer all over the India at some
reasonable terms. Normally it provide 80% funding of the market value of the property.

Key features of Aadhar Housing Purchase Loan

TABLE-1.4: FEATURES OF PURCHASING LOAN
Loan Tenure Up to 30 years
Loan Amount 2-200 lac
Interest Rate Fixed at the sole discretion of bank
Margin 10% (maximum)
Age limit Up to 65 at the time of maturity

Aadhar Housing Finance Home Loan Eligibility Criteria

Eligibility criteria for home purchase loan is almost similar to home land loan. To eligible for home
loan, one must be either salaried or self employed professional. The loan amount is determined by the
repaying ability of the borrower. If the borrower earns more and has existing loans, the loan amount will
be fixed accordingly.

AADHAR HOUSING FINANCE Ltd. CONSTRUCTION LOAN:

FIGURE-1.4: AHFL CONSTRUCTION LOAN

Constructing a house requires a lot of money. For this purpose banks and many financial companies
provide Home Construction Loan to the people for purpose of constructing their house of dream.

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Aadhar also provide Home construction loan to the people who are seeking to build a house. The loan
amount does not exceed 80% of the cost of construction. Loan can be applied singly or jointly. However
the loan tenure does not exceed upto 10 years and the borrower must be below 60 years at the time of
maturity of loan.

Key features of Aadhar Housing Construction Loan

TABLE-1.5: FEATURES OF CONSTRUCTION LOAN
Loan Tenure Up to 10 years
Loan Amount Upto 1 crore
Interest Rate Fixed at the sole discretion of bank
Margin 20%
Age limit Up to 60 at the time of maturity

Aadhar Housing Finance Construction loan Eligibility Criteria

The minimum age for applying construction loan is 21 years or maximum age is 60 years. It means
applicant must be below the age of 60 years and loan must be repaid before the borrower turn to the age
of 60 years. To eligible for home loan, one must be either salaried or self employed professional. The
loan amount is determined by the repaying ability of the borrower. If the borrower earns more and has
existing loans, the loan amount will be fixed accordingly.

AADHAR HOUSING FINANCE Ltd. HOME EXTENSION LOAN:

FIGURE-1.5: AHFL EXTENSION LOAN

As all of us want a big, spacious home but we settle down with the one which fits into our budget. Need
for a bigger space home is realized when children grow up, when relatives come in to live with us. So

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people turn their heads towards extension and it requires huge fund. It would be less than the amount
required for buying a new home. For the same bank and financial institution provide Home extension
loan.

Aadhar housing finance ltd. also provide loan for extending their home. It would be less than the amount
required for buying a new home. Moreover the process of disbursal would be less as it requires lesser
documentation work.

Key features of Aadhar Housing Extension Loan

TABLE-1.6: FEATURES OF EXTENSION LOAN
Loan Tenure Up to 20 years
Loan Amount Upto 1 crore
Interest Rate Fixed at the sole discretion of bank
Margin 20%
Age limit Up to 60 at the time of maturity

Aadhar Housing Finance Extension loan Eligibility Criteria

If an individual is already servicing a home loan, he is eligible to get home extension loan as a part of
extended service provided by the bank. The minimum age for applying construction loan is 21 years or
maximum age is 60 years. To eligible for home loan, one must be either salaried or self employed
professional. The loan amount is determined by the repaying ability of the borrower.

AADHAR HOUSING FINANCE Ltd. HOME IMPROVEMENT LOAN:

FIGURE-1.6: AHFL IMPROVEMENT LOAN

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Home improvements mean to alter the structure of existing home. It include changing lawns, gardens,
rooms, repair, maintenance, and general servicing. They are usually short term loans and could be get at
lower rate of interest.

Aadhar housing finance ltd also providing these type of loans as part of their extended service. These
loan normally carried lower rate of interest as compared to other type of loans.

Key features of Aadhar Housing Improvement Loan

TABLE-1.7: FEATURES OF IMPROVEMENT LOAN
Loan Tenure Up to 10 years
Loan Amount Upto 30 lakhs
Interest Rate Fixed at the sole discretion of bank
Margin 10%
Age limit Up to 60 at the time of maturity

Aadhar Housing Finance Improvement loan Eligibility Criteria

A borrower can avail a home renovation or home improvement loan if he have a property and willing to
renovate it. These loan are available for within the age groups of 21 years-60 years.

AADHAR HOUSING FINANCE Ltd. NRI HOME LOAN:

FIGURE-1.7: AHFL NRI LOAN

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NRI are someone who lives outside for “employment, carrying n business or vocation in circumstances
as would indicate an intention to stay outside India for an indefinite period”. It also says that an
individual will also be considered as NRI if his stay in India is less than 182 days during the preceding
financial year.

NRI loan can be availed to purchase, construct, renovate a new or existing house. One can also take
home loans to purchase a plot of land for residential use.

Key features of Aadhar Housing NRI Home Loan

TABLE-1.8: FEATURES OF NRI HOME LOAN
Loan Tenure 5-15 years
Loan Amount 5 lakh to 1 crore
Interest Rate Fixed at the sole discretion of bank
Margin 15%-25%
Age limit Up to 60 at the time of maturity

Aadhar Housing Finance Extension loan Eligibility Criteria

Eligibility criteria for NRI home loan is different as compared to others. To get an NRI home loan one
need to have at least a diploma or graduate degree with minimum of three years of employment abroad
or professional qualification. The interest rate on NRI home loan is similar as that for a resident Indian.
It generally lies between 10.25%-13.25%.

AADHAR HOUSING FINANCE Ltd. HOME CONVERSION LOAN:

FIGURE-1.8: AHFL CONVERSION LOAN

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In the simplest way, a home conversion loan implies the bank or financial institution allows its customer
to swap from one loan to another one, within same bank. The two major issues faced while buying a
new house are; loan obligations related with old house and money required to purchase new. Keeping
this in mind, many banks and financial institution provide conversion loan.

Aadhar Housing finance also offers conversion loan which helps to transfer existing loan to the new
house and also provide with extra funds required. Under this scheme, you are not required to pay off
previous loan. And the best thing for this loan is one do not have to go through the entire process of
applying for the loan again.

Key features of Aadhar Housing Conversion Loan

TABLE-1.9: FEATURES OF CONVERSION LOAN
Loan Tenure 5-15 years
Loan Amount 5 lakh to 1 crore
Interest Rate Fixed at the sole discretion of bank
Margin 15%-25%
Age limit Up to 60 at the time of maturity

Aadhar Housing Finance Conversion Loan Eligibility Criteria

The eligibility criteria followed for home conversion loan is almost similar with other home loans. One
just need to transfer its existing home loan to another home loan within same bank

PRINCIPLES OF GOOD LENDING

There are some general principles of good lending which every bank/financial institutions should follow
while giving a loan.

 Safety
Safety is the first important principle of good lending. When any financial institution give a loan, it must
feel sure that the advance is safe, i.e. the money will surely come back. For example, if the borrower

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invests the money in speculative venture or unproductive way, or if the borrower himself is dishonest,
the advance would be in danger of loss.

 Liquidity
It is not enough to assume that loan amount will come back, it is also important that it must come on
prescribed time or in accordance with the terms of repayment agreement. The borrower must be in
position to repay the loan within after demand for repayment is made. The source of repayment should
also be definite.

 Purpose
The purpose of loan amount should be productive so that the money not only remains safe but also
provides a definite source of repayment. The banker must closely investigate the purpose for which the
money is required, and ensure that the money borrowed is applied accordingly. Purpose behind
borrowing money must assumed a special significant in the present day concept of banking.

 Profitability
Equally important is the principle of ‘profitability’. Like other commercial institutions, banks must make
profits. First, they pay interest on the deposits received by them. They make provision for depreciation
of their fixed assets, and also for possible bad or doubtful debts. After meeting all these expenditure , a
reasonable profit must be made.

 Security
It has been the practice of banks not to lend against security. Security is considered as an insurance or an
air-bag in a car in case of an emergency. The banker carefully scrutinizes all the aspects of loan before
granting loan. It also provide for an unexpected change in circumstances which may affect the safety
and liquidity of the loan.

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 ELIGIBILITY CRITERIA FOR HOME LOANS
How much you can borrow?

It provides loan from Rs. 1lakh to Rs. 1crore. The loan period for which the loan can be taken is upto30
years, however does not extend beyond the retirement age or 60 years of the borrower.

AGE:

For taking a home loan you must followed some age criteria

Minimum age: you must attain the age of 21 years.

Maximum age: you should not above 60 years.

Individuals:

You must completed a minimum of 2 years of job service (with a minimum of 1 year in the current job)

ELIGIBILITY CRITERIA FOR A BUSINESSPERSON/SELF EMPLOYED:

One must have an well established business or professional practice , with a positive net worth and must
posted a net profit for the last 3 years. Minimum net take home salary of Rs. 8000/- per month for
professional or annual income of not less than Rs. 1.20lakh for self employed business person.

 Individual who are salaried or self employed, businessmen, professionals are eligible.
 As a customer to enhance loan eligibility, all institution providing finance lay down special
conditions to who be the co- applicants, all co- owners to the property should necessarily be co-
applicant. Income of co-owners can also be clubbed together to get higher loan eligibility.
 Minors are not eligible to become co-owners.
 Only blood relatives are eligible to become co-owners.

Some of the acceptable relationships where loan clubbing is possible

TABLE-1.10: RELATIONSHIP CLUBBING

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 Husband – wife YES
Parent-son YES
Parent-daughter YES
Brother-brother YES
Brother-sister NO
Sister NO
Parent-minor child Not eligible for loan
TABLE-:

 The minimum age for the applicant and the co-applicant to become eligible for the commencement
of the loan is 23 years, and the co-applicant can be of 18 years of age.
 The maximum age at the time of loan maturity for applicant or co-applicant is 60 years or the
retirement age, whichever is more.

DOCUMENTS REQUIRED FOR HOME LOAN

For this purpose all HFIs divide their employees into different categories.

They are:

 Salaried
 Professional or businessman

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The general documents, which are same for all the categories, are as follows:

 Proof of age

Any of the following can be considered for proof of age, they are:

Passport
Voter’s ID card
PAN card
Employer’s identity card
School leaving certificate
Birth certificate
 Copy of the bank statements of the last six months:
Bank statement of the last six months of all operating and salary accounts. Bank statements of the
last six months of current accounts, if self employed. Any other photocopy of investments held, if
required by the HFIs.
 Copy of recent credit card statement.
 Passport size photograph.
 Signature verification by bankers.
 Proof of residence:
 Ration card
 PAN card
 Passport
 Rent agreement if any, if currently staying on rent.
 Allotment letter from company if residing in company quarters.

The documents required to be provided by the salaried class are as follows:

 Salary slips for last one month.

 Appointment letter
 Salary certificate
 Retainer ship agreement, if appointed as consultant.

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 Form – 16 issued by the employer in borrower name.
 Proof of employment:
The proof of employment is verified by:
Identity card issued by the employer.
Visiting card.

Employer’s detail (in case of private limited companies):

The employer’s details need to be provided in addition to the above documents for a private
sector employee, they are:
 Name of the promoters/ Directors
 Background of promoters/Directors
 Name of the employees
 List of branches/factories
 List of clients/Customers
 Turnover of employer
 Annual reports of employer for the last two to three years.

The documents required to be submitted by the businessmen as follows:

 Last three years Profit and Loss Account statement duly attested by a Charted Accountant.
 Last three years balance sheet duly attested by a Charted Accountant.
 Last three years Income Tax Returns duly filed and certified by the Income Tax authorities.

Proof of Investment:

 Bank statements of the last six months of all the current accounts.
 Any other photocopies of investment held, as required by the HFI.

The above are the documents required by the businessman in addition to the documents which are
common to the entire category.

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THE PARAMETERS INVOLVED IN HOUSING LOAN EVALUATION:
There are numbers of parameters on which home loan conditions are built. They are:

 TENURE

The tenure of the loan refers to the difference between the time gap of commencement of loan and
maturity of the loan period. Normally, the maximum tenure of home loans is 20 years or retirement age
of the borrower (whichever is more. The longer the tenure period, more a customer pays in total interest,
but monthly installment will be less. So depending upon the earning potential and bank balance of the
customer, an appropriate can be chose. An important requirement of all the Housing Finance Institutions
is that borrower must pay up the entire loan amount before he retire. The customer can also prepay the
loan amount before it is due.As long as the tenure goes up a customer pays more interest which is up to
0.5%-1%, generally above the home loan rates.

 AMOUNT PAID BY THE FINANCER/MARGIN REQUIREMENTS

The financer does not pay the entire amount of the loan, they ask to the customer to maintain margin.
Most banks go in 85% funding of the property value including the stamp duty and charges. It varies
differently from banks to banks. This is also treated as the margin money or his own contribution
required to be put by the prospective loan seeker as the contribution release any disbursement.
As a rule of thumb, depending upon the HFC, the prospective loan seeker has to cough 15%-20% of the
loan amount as a down payment. For smaller amounts, this may not be much. But for figures running
into lacs, this could make loads of difference.
For example: An apartment costing Rs. 10lacs may get 85 per cent financing. So customer has to
arrange for the remaining 1.5lacs .Some banks however make way for the payment for 90% of financing
and about 100% financing for some new project. However they are subjected to a larger number of
factors and constraints.

 INTEREST RATES

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Without any doubt the most important parameter to consider home loan calculations. The interest rates
can vary from institution to institution. Generally it ranges between 10% per annum to 15% per annum.
The two kinds of interest rates available with a customer are:
 Fixed interest rates
 Floating interest rates
Fixed interest rates remain stable over the tenure of the loan.
Floating interest rates may change by the rates in the market, they fluctuate according to the rates
issued or charged by RBI.
As per new rate structure, customer will have to pay 10.5% on home loans with a floating rate, while the
fixed home loan will now invite an interest of 12.5%.
Some institution do so only once in 12 months while some private sector lenders do it as frequently as
a quarter. Though the current interest rate quota may be lower, over the life of the loan, a customer will
be able saved more in the case of a lender who resets your floating rate more frequently.
The investors are also given the option of changing their option from fixed rate loan to a floating rate
loam, of course by a paying a penalty.

 MISCELLANEOUS CHARGES:

All banks charge some amount of processing fee (miscellaneous fees) which cannot be ignored. These
make significant part of interest. It should also ensure that he has to pay these charges, so he should
careful in choosing his HFC.
Miscellaneous charges generally range around 3% to 4.5%.

Processing fees
It is the charges payable to the lender on applying for a loan. It’s either fixed amount not linked to the
loan or may also be a percentage of the loan amount. The loan amount not linked received by customer
can be less than the processing the application form.

Prepayment penalties
When a loan is paid back before the end of the agreed duration a penalty is charged by some
banks/institutions, which is usually between 2% and 3% of the amount being paid.

24
Administrative fees
An administrative fee is charged by the HFI on the loan amount sanctioned to the borrower. This fee is
payable at a time of accepting the offer letter. It is charged to meet the operating expenses of the loan
amount of the entire tenure.

Others
It is quite possible that some lenders may levy a documentation and consultant charge.
They are called other charges.

Aadhar Housing loan Charges

TABLE-1.11: AHFL OTHER CHARGES

Processing fees 2% of the loan amount
Technical verification INR 500+ GST
Cheque/Direct debit/ECS INR 500+ GST
Overdue/penal charges 2% of the due amount
Duplicate no due certificate INR 500+ GST
Copy of property papers INR 500+ GST
Loan cancellation INR 1500 with applicable charges
Prepayment charges 2% of the outstanding amount

 AMORTISATION

It means the way or the calculations though which entire principal amount is paid through the tenure of
loan. This helps the customer to know what is his outstanding principal at any point of time. There are
two methods mainly followed:

25
Annual rests:-This is also known as annual reducing balance of the principal/ loan amount lent to you. In
an annual EMIs (fixed monthly payments for the dispersal of the loan amount) are calculated on a
annual basis.The interest is higher in the initial years and later on the components of the principal
increases and the interest keeps reducing year after the years. In other words, the interests in the EMIs
will keep reducing year after year and the principal components keep increasing.
Monthly rests:-This is called monthly reducing balance or principal. The calculations in the above
method remains the same as in the above except that the balance is calculated on a monthly basis and the
EMI is broken up every month to arrive at the opening balance of the principal amount for the next
month. It is always better for a customer to seek an HFI, which generally has monthly rests, based
systems; this will reduce the amount of interest paid by the customer. Many HFIs have adopted to the
monthly rests system.

 REPAYMENT FACILITY

There are three options for repayment of the loan to suit the convenience of Borrower. Equated monthly
installments (EMIs) uniform monthly installment, inclusive of interest, for the repayment of only
interest for the first five years, and thereafter in EMI for the next 10 years. Repayment of only interest in
the first 5 years, 30% principal plus interest in the next five years, and balance 70% plus interest in the
remaining period. Repayment to start on finish of construction but not later then 18 months from first
disbursement and in case built up houses after one month from disbursement. Interest during gestation
should be paid as & when due. The repayment not to expand beyond the age of retirement of the
borrower or 70 years whichever is earlier, however where co-borrower is taken, a maximum repayment
period of 20 years considered provided the loan is liquidated within the age of 70 years of the borrower/
co-borrower having capacity to service the loan.
THE LOAN PROCEDURE FOLLOWED AT AADHAR HOUSING FINANCE:

The steps involve in the loan disbursement at any bank/financial institution entails the following steps:
 Application of home loan to be submitted by the customer.
 Checklist of requirements is from the customer, and all the copies of documents are required to be
submitted, then they are verified whether the details filled are true or not.

26
 Pay the processing fees.
 Discussion with bank or concerned financial institution.
 Valuation of the Documents.
 The sanction/Approval Process.
 Processing the offer letter.
 Processing the property papers followed by a check.
 Processing a technical check& the site estimation.
 The final deal, signing the agreement & disbursal.

Drivers of Demand in Housing

The housing demand is a product of three variables. First and foremost is increasing population.
Secondly, economic growth and urban migration have caused changes in preferences. Finally, increasing
affordability made households to invest in larger houses.

 Increasing population:- Population growth has a direct bearing on the requirement for house.

 Urbanisation :- Urbanisation has dual impact on housing demand. On the one hand, it reduces
the area per household, and on the other, there is an increasing demand for more nuclear families.

 Nuclearisation:- Nuclearisation refers to the formation of small families from joint families.
Nuclearisation, like urbanisation, also has dual impact. It reduces the area per household, but
increases overall household formation, thus increasing the demand.

 Affordability:- There has been a steady growth of households into higher income Categories.
This also lead to high demand for home loan.

ADVANTAGES IN TAKING HOME LOAN

27
 Makes easy to buy a dream home:-For many people buying house with own money is impossible,
home loan as it can be repaid in easy monthly installments makes it easier to purchase a house.
 Loan repayment Tenure:-Among all loan, home loan has the largest repayment tenure which goes
up to 30 years, so one can reduce the burden of monthly installments by extending the repayment
tenure.
 Enjoy capital appreciation:-One would also benefit from the rise in prices of the property over
time.
 Saves from paying rent:-As rent in metro cities is quite high they put strain on monthly budget. It is
better to pay EMIs and own a house.
 Tax deduction:-To encourage more people buy their own home, government of India provides tax
deduction on the principal as well as interest paid on home loan.

RISK IN TAKING HOME LOAN

 Home loan is a long term commitment:-It takes one whole life to repay the entire loan and there is
continuous burden to repay the monthly installments and regular interest.
 High rate of interest:-Generally these financial institutions are just exist to make high profit. They
charge high rate of interest on home loan which stop people to apply for the loan. It usually up to
approx 15%.
 Loan to value:-They do not provide complete amount of the property. They leave certain margin.
Generally banks provide 80-85% value of the property.
 Excessive paper work:-One get tired before taking loan when he hears about the documentation
needs to be done. And it stops them to take loan. There is too excessive works.
 Securities:-Bank provides loan to against the securities provided by the customers. They are
deprived of using their own things. It results in loss of other equipment.

28
 LITERATURE REVIEW
The Literature review shows the various researches done by various researchers on a project. Various
researchers have explained their project according to their understanding. These researches help other
researcher to understand a project. Every researcher has explained different subject differently. These
types of differences occur due to different type of method chosen for collecting data, area within these
research is done, level of understanding etc.

29
If we talk about study on home loans number of researches have been carried out and the various type of
researchers try to find various dynamics related with home loan.

Various type of research made by various researchers is:

Goff and Leslie (1995) says that house buyers are being in relief as the mortgage industry is providing
them the service with the lending of information relating to length and cost of the credit loan application
process. By eliminating the certain traditional documentation process with the aid of expert systems in
the industry lenders are able to approve the borrower’s credit and also to fix appropriate interest rates. It
also speeds the mortgage application and approval process.

Weber and Diane (1996) says that bargain borrowing interest rates are the result of refinancing boom
as the lenders have been competing for homeowners attention. They provide with 2 options of
borrowing that is a loan, when u need all cash at once and a line of credit, for the flexibility purpose. A
customer need to verify with all the financial hoops in order to qualify their loan and must not depend
upon the super low interest rates as advertised.

Lai and Zhihong (2001) explains that the variables such as interest rate charges, loan to value ratio,
loan size, and borrower’s credit have a significant impact on mortgage repayment stated as in
theoretical models and empirical studies. The objectives of this paper is to empirically analyse the
situation through three statistical stages which are the ordinary logistic regression. They suggest that the
discrete –time logistic regression is better than the cox regression proportion of hazard model, even
through it is not concluded which model is better in general.

Mann, George R, Lawton, G Kevin (2003) explains that an adequate underwriting which supports the
transaction and also the thorough ongoing account management can help in finding the safety and
soundness of the lending activities of Real Estate businesses. For all the real estate related financial
transaction an appraisal performed by the state-certified or licenced appraiser is necessary. They found
the results in getting the real estate appraisal done in 3 main parts which are competent appraisers, the
significant appraisal policy and report for each transaction and determining the appropriate policy to
review the transaction relating to the appraisal report.

Robert J. Shriller (2007) did a study on understanding recent trends in house prices and home
ownership. He finds that price is a major impact on a decision whether or not to buy a house. People’s

30
opinions about long-term decisions, notably how much housing to buy and what is a reasonable price to
pay, change in the short term only because their opinions about the long-term change. People decisions
based upon expectations for the future, and if they have the false impression that they have a unique
property that is going to become extremely valuable in the future, then they may consume more, driving
the economy, & they may drive up prices.

Cassis and John (2007) says that there is an impact on the bank, on customers and on shareholders by
the every decisions and opinions made by the credit professionals. There is always something new to
learn and indulge in modern policies to the bankers to make a positive difference to their financial
institutions, their clients as well as to their colleagues because of changing trends in the market.

Walsh and John (2009) speaks on the 3 important attributes to consider the loan application in the
market to underwrite lending procedures and they are income, credit and collateral. Previously, the
human appraisal and software based automated application model (AVM) were considered for credit
valuation. More cost effective ways to value properties by the lenders, then the AVM came into picture.
The statistical approach has been introduced to replace the human appraisal. In order to arrive at more
confident price point for the inconsistent data, more detailed appraisals can be done by human
evaluation.

Dr. Rosy Kalra (2012) explains that fiancé is required at every stage of business either for starting up
the business or in order to monitor it in meeting the day to day expenses of business. The primary
function of any financial institution is to lend the commercial loan. 33 She also explains that how the
lender is supposed to verify the credit worthiness of the customer? What are the criterions to be fulfilled
to grant the loan proposal? What are the tools to be used in the banks to minimise the credit risk?

Seema U, Venkatesh, Mahadev & Anjali N (2012) says that it depends more on the company and the
industry to evaluate the credit risk. It remains as a challenge to the banks to evaluate the potential credit
application. This paper enquires in the Indian banks the applicability of one of the new integrated model
on a sample data. The integrated model is a combination of techniques of logistics regression and multi-
layer perception.

Ms Soniya Mohil (2013) explains that the elementary desire of an individual is to own a house, it not
only provides a shield to live but also provides the financial security at the time of adverse 
circumstances. A person can get funds using it as collateral security from the market. Housing sector

31
acts as a big contributor for the employment opportunities in the Indian community. This study
endeavours to retrieve the continuous movement of housing industry since 2008 till 2013 in India by
reviewing the annual publications of National Housing Bank.

Ch. Karuna & Prof. Dr. G Tulsi Rao (2013) explains that due to housing finance in India, the
liberalisation of the financial sector of the economy has also become possible. Housing finance say been
top of research and trends in the recent years. It also provides the current housing position in India,
institutional performance of the housing sector and basically the manuscripts will conclude with the
recommendations to improve the national dwelling position.
Madhu T (2013) portrays that in order to educate the normal individuals regarding the importance of
reliable credit history and Do’s and Don’ts list prepared by some of the experts originally propagated by
the credit information companies such as CIBIL, Experian and Equifax. This study found that the
objective of the bank’s credit appraisal process is to find the evaluation and intention of repayment of
loan by the customer on agreed terms and conditions, says a senior executive vice president and head of
debt management, risk intelligence and business analytics called Rajesh Kumar at HDFC Bank.

Ding and Lei (2014) explains that after the great recession, the flow of credit to the residential sector is
a difficult situation in the recovery of housing market. This study portraits the effect of information
externality on the lending decisions during housing crisis of metropolitan cities from previous
transactions. Results of this study states during the housing crisis, the positive side arises by the
systematic process of property evaluation and also the mortgage underwriting.

Utkarsh Gupta, Richa sinha(2015) makes a study on factors affecting borrowers behaviors towards
home loan. In conclusion they find that the demand for home loan has been increasing in India due to
the requirement of residential accommodation. A large amount of Indian population is availing the home
loan facility which is offered by public as well as the private sectors banks. There are number of factors
affecting borrower behavior like good communication, trust on institution, easy documentation facility
fast processing of loan, cooperative staff. It is important for the institution offering home loan to
consider and keep a track of factors affecting the decision of buyer.

Ahmed, Sufi Faizan, Malik and Quisar Ali (2015) says that the dimensions of credit risk management
practices such as credit terms, client appraisal, collection policy and credit risk control on the lending
procedure to evaluate the influence of the credit risk management practices is the main aim of the study

32
of this paper. For empirical relationship evaluation of credit risk management practices on the
performance of lending, they have used the multiple regression analysis. The study result says that
collection policy and credit risk control have 30 positive but insignificant impact on the lending
performance but whereas credit terms and client appraisal gives positive as well as the significant impact
on the study.

Sabry, Faten, Franceschelli, Igancio, Claston, Drew (2016) evaluates the importance of changes in
the home equity loans and also the potential errors of appraising values in clarifying the borrower’s
probability towards his default in repayment of loan. Mortgage loans originated between 2005 and 2007,
they estimated multinomial logistics model of default and prepayment using loan level data more than 3
million subprime mortgages. They found that 44.8% of subprime borrowers were at defaulters list by
2011.

Raymond Fisman, Daniel Paravisini, Vikrant vig (2017) makes a study on cultural proximity and
loans. They measured the extent of different treatment in the loan market of those shared a cultural
background. They conclude that both lender and borrower have group affiliations and they may
distinguish between own-group preferences vs differential group treatment. In the Indian context they
find, targeted reservation policies that impose a larger proportion of backward caste officers in regions
with a high number of backward borrowers may improve efficiency and inequalities in home loan
allocation.

RESEARCH METHODOLOGY

3.0) RESEARCH METHODLOGY

I had collected the data through several customers of Aadhar Housing Finance ltd. I had used primary
sources and secondary sources for making a study on home loan. Statement of the problem, Justification

33
of the study, Objective of study, Scope of the study, Research design and various sampling techniques
were used to prove the study.

3.1) STATEMENT OF THE PROBLEM

To make a study related with dynamics of home loan. In India there are various types of home loan
schemes but which scheme is better depend on the risk factor, interest charged, tenure, etc.

3.2) JUSTIFICATION OF THE STUDY:

This study is basically presented to show what is home loan, what their types, eligibility for applying
loan, documents needed, factors affecting home loan evaluation, nature of risk, mode of payment etc. in
a cut short so that every borrower can know about it. In today scenario home loan comes to play a major
role where many people are still deprived of their own home. Due to competition there are various kind
of home loan schemes and it make very complicated to know that which scheme is better. Depending on
the needs, limitations and choice of the borrower they can choose any of the loan scheme which suits to
their convenience.

3.3) OBJECTIVE OF THE STUDY

Main objective: The main objective is to study the dynamics related with home loan.

Sub objective:

 To understand the documentation involved in the home loan.

 To know the innovative home loan schemes.

3.4) SCOPE OF THE STUDY

This study is mainly related to all loan provided by the company. This study is mainly based on the
individuals who are interested in taking loans from the company to fulfill the dream of purchasing their
own home.

3.5) RESEARCH DESIGN

34
I used descriptive research design in my study .It is an arrangement of data collection of various loan
schemes. The collection and analyzing of data is made in such a manner that it provide useful
information to the people who want to borrow money from constructing home.

3.6) COLLECTION OF DATA:

 Personal Interviews:.

In personal interview I make a face to face interaction with borrowers who already borrowed money
from AHFL. I also make a telephone conversation between those persons who want to take home loan

 QUESTIONNAIRE:

Under Questionnaire I send a detail question paper to the various people who are involved in borrowing
fund in various Housing Finance Schemes.

3.7) SOURCE OF DATA COLLECTION:

The source of data include both Primary and secondary data.

 PRIMARY DATA
 SECONDARY DATA.

1) Primary Data is collected with some specific objective, especially to show that which housing finance
scheme is best. This data is collected by taking a personal interview of the borrowers who borrow home
loan from Aadhar housing finance ltd. and a questionnaire is also mailed to those persons who want to
take home loan.

2) Secondary Data includes Journals, Magazine, Editorials of AHFL, Internet and Government Report
on home loan.

3.8) SAMPLING TECHNIQUE:

I used simple random sampling while collecting data. The data collected from the customers are shown
on the worksheet with the help of tally bars and it is analyzed by various statistical tools by drawing

35
tables, graphs, and inferences were drawn on the basis of market concept and conversation. So based on
a marketing concepts finding of research various recommendations are made.

3.9) SAMPLE SIZE

The data collected is based on the sample of 50 respondents.

3.10) ANALYTICAL TOOLS USED IN STUDY:

Tools used for analyze data are graphs i.e. bar graphs. A questionnaire is also distributed to the
individual respondents and special care is taken so that every customer can fill this questionnaire
comfortably and can give answer easily. This method is used so that an unbiased answer can be
received.

3.11) LIMITATION OF THE STUDY:

There is no reading in which there is no limitation. Limitation of my reading is:

 Sample size used in this reading is not so big so there is no 100% accuracy on the result.
 Various methods which are used in collection of data are primary and secondary data which shows
that there is some kind of biased in the data whose reflection can be shown in the study.
 The study involves only the area of local region which is not sufficient for finding the exact figure of
the study.
 It may be possible that the questions which were asked in the questionnaire are not sufficient to draw
any conclusion.

DATA ANALYSIS
1. Which Age Group do you belong to?

Table – 4.1: AGE CATEGORY OF RESPONDENTS

AGE CATEGORY RESPONDENTS Percentage

18-25 YEARS 10 20
25-35 YEARS 20 40
35-45 YEARS 10 20

36
 45 YEARS AND ABOVE 10 20
TOTAL 50 100

45
40
40
35
30
25
20 20 20
20
percentage
15
10
5
0
18-25 YEARS 25-35 YEARS 35-45 YEARS 45 YEARS
AND ABOVE

FIGURE- 4.1: AGE CATEGORY OF RESPONDENTS

INTERPRETATION:
It can be inferred from the above graph that 40% of the respondents belong to 25-35 years.20% of the
respondents belong to 18-25 years.20% of the respondents belong to 35-45 years.20% of the respondents
belong to 45 years and above. Maximum respondent belongs to 25-35 years.

2. Which occupation do you belong?

TABLE–4.2: OCCUPATION OF THE RESPONDENTS

OPTION RESPONDENTS PERCENTAGE

PROFESSIONAL 10 20
SELF EMPLOYED 25 50
SALARIED 15 30
TOTAL 50 100

37
 60

50
50

40

30
30
percentage
20
20

10

0
PROFESSIONAL SELF EMPLOYED SALARIED

FIGURE -4.2: OCCUPATION OF RESPODENTS

INTERPRETATION:
It can be inferred from the above graph that 50% of the respondents belong to self employed.30% of the
respondents belong to salaried class.20% of the respondents are professional.

3. Which income group do you belong? (per annum)

TABLE – 4.3: INCOME EARN BY THE RESPODENTS

OPTION RESPONDENTS PERCENTAGE

BELOW 2 LAKHS 15 30
2-4 LAKHS 20 40
4-6 LAKHS 10 20
MORE THAN 6 LAKHS 5 10
TOTAL 50 100

38
 45
40
40
35
30
30
25
20
20
percentage
15
10
10
5
0
BELOW 2 2-4 LAKHS 4-6 LAKHS MORE THAN
LAKHS 6 LAKHS

FIGURE – 4.3: INCOME EARNED BY RESPODENTS

INTERPRETATION:
It can be inferred from above graph that 40% respondents earn income ranging 2-4 LAKHS.30% of
respondents earn their income below 2 lakhs.20% respondents earn income ranging between 4-6
lakhs.10% of respondents earn income of more than 6 lakhs.

39
4. What is your educational qualification?

TABLE-4.4: EDUCATION QUALIFICATION

OPTION RESPONDENTS PERCENTAGE

POST GRADUATE 15 30
GRADUATE 20 40
UNDER GRADUATE 15 30
TOTAL 50 100

45
40
40
35
30 30
30
25
20 percentage

15
10
5
0
post graduate graduate under graduate

FIGURE – 4.4: EDUCATION QUALIFICATION

INTERPRETATION:
It can be inferred from above graph that 40% respondents are graduate.30% respondents are post
graduate.20% respondents are under graduate.

40
5. Have you live in your own house?

TABLE – 4.5: HAVE YOU LIVE IN YOUR OWN HOUSE

RESPONSE RESPONDENTS PERCENTAGE

YES 18 36
NO 32 64
TOTAL 50 100

70
64
60

50

40 36
percentage
30

20

10

0
YES NO

FIGURE – 4.5: HAVE YOU LIVE IN YOUR OWN HOUSE

INTERPRETATION:
It can be inferred from above graph 36% respondents live their own house.64% respondents do not have
their own house.64% of respondents do not live in their own house because they have not sufficient fund
for financing home.

41
6. Would you prefer to purchase home by taking loan from bank?

Table – 4.6: WOULD YOU PREFER TO PURCHASE HOME BY TAKING LOAN

OPTION RESPONDENTS PERCENTAGE

YES 27 54
NO 23 46
TOTAL 50 100

56
54
54

52

50
percentage
48
46
46

44

42
YES NO

FIGURE - 4.6: WOULD YOU PREFER TO PURCHASE HOME BY TAKING LOAN

INTERPRETATION:
54% respondents say YES.46% of the respondents say NO.

42
7. From where you come to know about home loan schemes?

TABLE – 4.7: From where you come to know about home loan schemes

OPTION RESPONDENTS PERCENTAGE

NEWSPAPERS 20 40
FRIENDS 5 10
HOARDING 15 30
MAGAZINES 10 20
Total 50 100

45
40
40

35
30
30

25
20 percentage
20

15
10
10

0
Newspaper Friends Hoarding magazines

FIGURE-4.7: FROM WHERE YOU COME TO KNOW ABOUT HOME LOAN SCHEMES

INTERPRETATION:
40% respondents know about home loan schemes through newspapers.10% respondents know through
friends.30% respondents know about home loan schemes through hoardings and 20 % respondents know
about home loan schemes through magazines.

43
8. Which sector did you prefer to take home loan?

Table – 4.8: Which sector did you prefer to take home loan?

OPTION RESPONDENTS PERCENTAGE

GOVERNMENT SECTOR 30 60
PRIVATE SECTOR 20 40
TOTAL 50 100

70

60
60

50

40
40
percentage
30

20

10

0
GOVERNMENT SECTOR PRIVATE SECTOR

FIGURE - 4.8: Which sector did you prefer to take home loan?

INTERPRETATION:
60% of the respondents prefers government sector.40% of the respondents prefer to private sector this is
because people prefer more government sector due to the risk factor as there are more risk in private
sector.

44
9. Are you a customer of Aadhar Housing finance ltd?

TABLE –4.9: CUSTOMER OF AADHAR HOUSING FINANCE LTD

OPTION RESPONDENTS PERCENTAGE

YES 15 30
NO 35 70
TOTAL 50 100

80
70
70

60

50

40
percentage
30
30

20

10

0
YES NO

FIGURE – 4.9: CUSTOMER OF AADHAR HOUSING FINANCE LTD

INTERPRETATION:
30% of the respondent is a customer of Aadhar housing finance.70% of the respondents is not a
customer of Aadhar housing finance. Most of the people are not aware of Aadhar housing finance
because of the lack of advertisement facility.

45
10. Rank the following factor which you consider while borrowing loan.

TABLE – 4.10: FACTOR CONSIDER WHILE TAKING LOAN

OPTION RESPONDENTS PERCENTAGE

INTEREST 20 40
Tenure 10 20
MARKET CONDITION 10 20
MARGINAL RATE 10 20
TOTAL 50 100

45
40
40

35

30

25
20 20 20
20 percentage
15

10

FIGURE-4.10: FACTORS CONSIDER WHILE TAKING HOME LOAN

INTERPRETATION:

40% respondents consider of interest while taking loan.20% respondents consider tenure while taking
loan.20% respondents consider market conditions while taking loan.20% respondents consider income
while taking loan.

46
11. What securities have you deposited?

TABLE-4.11: SECURITIES DEPOSITED

OPTION RESPONDENTS PERCENTAGE

FIXED DEPOSIT 15 30
LAND PAPER 10 20
THIRD PERSON 5 10
OTHERS 20 40
TOTAL 50 100

45
40
40

35
30
30

25
20
20 percentage
15
10
10

0
Fixed Deposits Land Paper Third Person Others

FIGURE – 4.11: SECURITIES DEPOSITED

INTERPRETATION:
30% respondents deposited fixed deposits. 20% respondents deposit land paper. 10% respondents gives
other people references and 40% respondents gives others securities.

47
12. what was the need for home loan?

TABLE – 4.12: NEED FOR HOME LOAN

OPTION RESPONDENTS PERCENTAGE

CONSTRUCTION 25 50
PURCHASE 15 30
RENOVATION 5 10
EXTENSION 5 10
TOTAL 50 100

60

50
50

40

30
30
percentage
20

10 10
10

0
Construction Purchase Renovation Extension

FIGURE – 4.12: NEED FOR HOME LOAN

INTERPRETATION:

50% of the respondents says for construction of home..30% of the respondents says for purchase of
home.10% of the respondents says for renovation.10% of the respondents says for extension of home.

48
13. How much loan amount you took?

TABLE – 4.13: LOAN AMOUNT

OPTION RESPONDENTS PERCENTAGE
LESS THAN 5 LAKH 24 48
5-10 LAKH 10 20
10-30 LAKH 12 24
MORE THAN 30 LAKH 4 8
TOTAL 50 100

60

50 48

40

30
24 percentage
20
20

10 8

0
less than 5 lakh 5-10 lakh 10-30 lakh More than 30
lakh

FIGURE – 4.13: LOAN AMOUNT

INTERPRETATION:
48% of the respondents took less than 5 lakh..20% of the respondents took loan between 5-10 lakh..10%
of the respondents took loan between 10-30 lakh..10% of the respondents took loan more than 30 lakh.

49
14. Do you want to shift your bank loan from your bank to another?

TABLE-4.14: DO YOU WANT TO SHIFT YOUR BANK FROM ANOTHER

OPTION RESPONDENTS PERCENTAGE
YES 22 44
NO 28 56
TOTAL 50 100

60
56

50
44

40

30
percentage

20

10

0
YES NO

FIGURE - 4.14: WOULD YOU PREFER TO PURCHASE HOME BY TAKING LOAN

INTERPRETATION:
44% respondents says YES.56% of the respondents says NO.

50
15. Rate the company that you are aware of.

TABLE – 4.15: RATING OF COMPANY ACCORDING TO AWARENESS

OPTION RESPONDENTS PERCENTAGE

AADHAR HOSUING 15 30
AXIS 2 4
ICICI 8 16
HDFC 25 50
TOTAL 50 100

60

50
50

40

30
30
percentage
20 16

10
4

0
AADHAR AXIS ICICI HDFC
HOUSING

FIGURE– 4.15: RATING OF COMPANY ACCORDING TO AWARENESS

INTERPRETATION:
50% respondents are aware of HDFC.30% respondents are aware of Aadhar housing..4% respondents
are aware of AXIS.16% respondents are aware of ICICI.50% respondents are aware of HDFC because
of various kind of advertisement and due to the old company.

51
16. Rate the company according to the sevices?

TABLE – 4.16: RATING OF COMPANY ACCORDING TO SERVICES

OPTION RESPONDENTS PERCENTAGE

AADHAR HOUSING 20 40
ICICI 15 30
AXIS 5 10
HDFC 10 20
TOTAL 50 100

60

50
50

40

30
30
percentage
20 16

10
4

0
AADHAR ICICI AXIS HDFC
HOUSING

FIGURE – 4.16: RATING OF COMPANY ACCORDING TO SERVICES

INTERPRETATION:
40% of the respondents likes the services of the AADHAR HOUSING.30% of the respondents likes the
services of the ICICI.20% of the respondents likes the services of the HDFC.4% of the respondents likes
the services of the AXIS.40% of the respondents like the services of Aadhar housing because company’s
objective is consumer satisfaction due to which they provide better services than other company.

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17. What are the qualities you like most about Aadhar Housing Finance?

TABLE – 4.17: QUALITIES OF AADHAR HOUSING

OPTION RESPONDENTS PERCENTAGE

ATTITUDE TOWARDS 14 28
CUSTOMER
CUSTOMER SERVICE 10 20
INFORMATION 20 40
TECHNOLOGY
PHYSICAL FACILITIES 6 12
TOTAL 50 100

45
40
40
35
30 28
25
20
20
15 12
10
5 percentage
0
s e y s
er ic og ie
om er
v ol i lit
st c
r S hn fa
cu e te
c al
d m sic
ar s to io
n y
w at
to Cu Ph
de rm
tu fo
tti In
A

FIGURE– 4.17: RATING OF COMPANY ACCORDING TO AWARENESS

INTERPRETATION:
28% respondents likes attitude towards customers.20% respondents likes customer service of Aadhar
housing.40% people likes information technology.12% respondents likes physical facilities of Aadhar.

53
18. What do you feel about overall quality of Aadhar housing?

TABLE – 4.18: RATING ACCORDING TO QUALITY OF SERVICES OF AADHAR HOUSING

FINANCE

OPTION FREQUENCY PERCENTAGE

STRONGLY DISAGREE 1 2
DISAGREE 4 8
NEUTRAL 10 20
AGREE 20 40
STRONGLY AGREE 15 30
TOTAL 50 100

40
40
30
30
20 FIGURE– 4.18:
20
RATING
10 8
ACCORDING
2
TO QUALITY
0 percentage
OF SERVICES
E E L E E
RE RE A RE RE OF AADHAR
G G TR G G
A A EU A A HOUSING
IS IS
D D N LY
G
LY N
N
G RO
RO ST
ST

INTERPRETATION:
It can be said that 2% respondents strongly disagree about the overall quality of Aadhar housing.8%
respondents disagree about the overall quality of Aadhar housing .20% respondents are neutral about the
overall quality of Aadhar housing.40% respondents completely agree about the overall quality of Aadhar
housing.30% respondents strongly agree about the overall quality of Aadhar housing

FINDINGS

54
 The highest population belong to 25-35 years age group
 It can be said that there is little difference between Government and Private sector but it can also be
said that people slightly prefer Government sector more.
 It can be inferred that most of the people does not live in their own house.
 In this survey I found that 50% people are self employed.
 Most of the respondent like to take loan for buying home.
 30% respondents deposited fixed deposit as securities and 40% takes other references.
 30% of samples are customer of Aadhar Housing. The figure is too low because lack of
advertisement.
 It can be inferred that most of the people like the services of Aadhar Housing finance ltd. due to its
sole objective of customer satisfaction.
 In this survey 40% of sample earns income within 2-4 lakhs.
 48% of sample took home loan of less than 5 lakh.
 People usually care for interest charged while taking loan and after that tenure and loan to value is
important.
 50% people are aware of HDFC and 30% people are aware of Aadhar Housing.
 40% of the same people like the services of the Aadhar Housing.
 40% of the respondents agreed that the overall quality of Aadhar Housing is good.

SUGGESTIONS

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 The criteria required to fulfill is too much. They should be minimize to bring ease in applying loan.
 The expectation of the person borrowing loan should also be taken into consideration.
 There should be more clarification related with all the dynamics related with home loan.
 Other charges should be minimize.
 The documentation required to complete should be minimize so that more people urge to take loan.
 The interest which are to be paid by the borrower should be minimizes so that more people take
home loan.
 Various campaigns should be launched so that the borrower should have a full knowledge about the
home loan and they can take loan from right place.

CONCLUSION

56
Home loan is growing at fast rate in nowadays as it is beneficial for those person who want to borrow
money for longer period. A Home loan is a better option in today’s scenario. In modern financial
scenario home loan is came to be the best as it include various type of reliefs like, long tenure, small
monthly installment ,low interest. Every person want to borrow that type of loan in which he give less
interest so this can be possible when you are having a full knowledge of the financial world but it is not
possible for every person to have full knowledge about the financial world so for that home loan is best
as the they are professionally managed so the person who are not aware of the market can also borrow it
and can make his dream home.

57