...Home Loan FAQs A. An Introduction to Home loans 1. What is a Home loan? Home loan is the sum of money a bank or financial institution lends you to help you buy your dream home. By taking a home loan from a bank or a housing finance company you pledge your home as the lender’s security for repayment of your loan. The bank or financial institution will hold the title or deed to the property till the loan has been paid back with the interest due for it. Home loans are generally taken for long tenures as the loan amount is usually a huge sum. A home loan can be taken anywhere between 5 and 30 years. The amount of loan one is eligible for is dependent on the individual’s credit profile. 2. What is a down payment? What are the ways in which I can source my down payment? Generally as a thumb rule, banks or financial institutions lend 85% of the cost of the property. 15% of the money is expected to be paid as a down payment for the loan. Opting for a personal loan if you can afford that cost as well, pledging your investments, getting loan against your insurance policy etc. are some ways to liquidate your assets and pay your downpayment. 3. Are there any specific loans available for NRIs? Yes, there are specific loans that are tailored for the requirements of NRIs who wish to build or buy a home in India. 4.What is reverse mortgage? This loan facility allows a senior citizen (above 60 years of age) eligible to apply for a reverse mortgage loan and avail 60% of the value of the residential...
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...HOME LOAN TAKEOVER OPPORTUNITY AND CHALLENGES Internship Report submitted to SBI in completion of the requirement of Summer Internship at State Bank of India NAME OF THE STUDENT: kushal Shah PROJECT MENTOR/ REPORTING OFFICER AT THE BANK: Mr Kumar APRIL 6th 2013 TO JULY 6th 2013 Acknowledgement I take this opportunity to express my profound gratitude and deep regards to Mr. Bhoir, HR, State Bank of India for giving me the opportunity to take up this project and posing faith in me to fulfill the project I also take this opportunity to express a deep sense of gratitude to Company Mentor Mr. Kumar, Manager State Bank of India, for his cordial support, valuable information and guidance, which helped me in completing this task through various stages. I am obliged to staff members of State Bank of India especially Mr. Saraswat & Ms Warrier, HLST Departement, State Bank of India for the valuable information provided by them in respective fields. I am grateful for their cooperation during the period of my assignment. Lastly, I thank almighty, my parents, brother, sisters and friends for their constant encouragement without which this assignment would not be possible. I am also thankful to all the respondents whose cooperation & support has helped me a lot in collecting necessary information. Kushal Shah Bottom of Form Table of Contents Sr. no | Particulars | Page no | 1 | 1. Introduction 2.1. Profile of Student 2.2. Profile...
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...STUDENT DECLARATION This is to certify that I have completed the Project titled “A STUDY ON HOME LOANS” under the guidance of “Mr. Amit Kumar Gupta” in the partial fulfillment of the requirement for the award of the degree of “Masters in Business Administration” from “Rukmini Devi Institute Of Advanced Studies, New Delhi.” This is an original work and I have not submitted it earlier elsewhere. RAJNI CERTIFICATE This is to certify that the project titled “A STUDY ON HOME LOANS” is an academic work done by “RAJNI” submitted in the partial fulfillment of the requirement for the award of the degree of “Masters in Business Administration” from “Rukmini Devi Institute Of Advanced Studies, New Delhi.” under my guidance and direction. To the best of my knowledge and belief the data and information presented by him in the project has not been submitted earlier elsewhere. Mr. Amit Kumar Gupta (Project Guide) RDIAS ACKNOWLEDGEMENT "Gratitude is not a thing of expression; it is more matter of feeling." There is always a sense of gratitude which one express towards others for their help and supervision in achieving the goals. This formal piece of acknowledgement is an attempt to express the feeling of gratitude towards people who helpful me in successfully completing...
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...MANC_C03.qxd 08/01/2007 10:42 AM Page 95 Atlanta Home Loan Case Study Atlanta Home Loan THE COMPANY Atlanta Home Loan (hereafter AHL) was a mortgage lending and financing company based in Atlanta, Georgia. Al Fiorini founded the company in April 2002 with an initial investment of about $40,000. He started operating the company from his home. Al had many years of experience in the mortgage lending industry. He had worked for several different companies and had also served a year as president of the Orange County Chapter of the California Association of Mortgage Brokers. Under his direction, AHL’s business grew rapidly in its first quarter of operation. By the summer of 2002, the company consisted of four telemarketers and eight loan officers, all of whom worked from their homes. “Telecommuting” was convenient for the employees because Atlanta was a large city with heavy traffic. Al established banking relationships that allowed AHL clients to borrow money at wholesale rates. The actual loan terms varied depending on the clients’ FICO scores.1 In summer 2003, banks might offer an AHL client with a very high FICO score (over 620) a rate of 6.25–6.75% on a fixed 30-year mortgage. This rate provided the bank with an operating margin of 1.5–2.0%. AHL earned a fee of 1.50% of the loan amount for every loan funded. This provided AHL with an average revenue per loan of $3,200. AHL bought leads from list brokers for $0.20 per name. These lists provided...
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...Case --- Atlanta Home Loan 1. Identify the controls that Al Fiorini implemented to manage his business (both before and after he went back to school). Classify each control as a results, action, or personnel/cultural type control. a. Before Al went back to school •Result Controls: ① Telemarketers were paid a combination of an hourly wage plus a performance bonus ($10.00) for each lead produced. ② AHL paid the loan officers 40% of total loan revenue on loans that AHL originated, and 60% on loans they originated. •Action Controls: ① Telemarketers called and gave the potential clients’ names to Al and Al distributed the names to AHL’s loan officers. ② Al monitored the activities of loan offers, track the number of credit inquiries each requested. ③ Al monitored the loan application per lead ratios and their trends. ④ Under Al’s direction, AHL’s business grew rapidly. Telemarketers, loan officers and loan processors all took their responsibility. •Personnel Controls: ① Select the employees who work as telemarketers, loan officers, loan processors… to see if they were satisfied with these position or not. b. After Al went back to school •Result Controls: ① Al monitored AHL operations from afar. ② Al tracked the employee head count, the number of leads produced, credit inquiries requested, loan applications funded, office expenses and bank activity. ③ Al had the authority to sign checks written against AHL’s main bank account. ④ Al had all of...
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...the controls that Al Fiorini used to control his business both before and after he went back to school. Classify each control as a results, control, or personnel/cultural type of control. Action control Before he went back to school i. Al monitored the activities of his loan officers by tracking the number of credit inquiries each requested. (Merchant, pg.23) ii. Al closely monitored the loan application/lead ratio depending on the skill of the loan officer. (Merchant, pg.23) iii. Al refused Wilbur’s request to have signing authority on company checks written against AHL’s main bank account. However, as a sign of good faith, he left 4 blank checks (only to be cashed with his permission) with Letitia, the office manager, whom Al trusted. (Merchant, pg. 24) After he went back to school i. Al was no longer managing the day to day operations of the company but continued to monitor AHL’s operations closely. Daily, or as soon as the information was available, Al tracked the employee head count, number of leads, credit inquiries, loan applications, funded expenses and bank activity. (Merchant, pg.25) ii. Al was also on the phone 3-4 hours per day talking with employees, and, particularly, loan officers. He thought that this would allow him to monitor the employees’ emotional states, one that Al thought would be an important leading indicator of forthcoming company performance. (Merchant, pg.25) iii. Al also had the company mail forwarded to his California address...
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...tlanta Home Loan Case Introduction: Atlanta Home Loan was a mortgage lending and financing company based in Atlanta with initial investment of $40,000. It was founded by Albert Fiorini in April 2002 and was operated from his home. He decided to earn an MBA degree from California and left the controls of the company in the hands of his employees. The control systems he used, what went wrong in implementing them and what should Al do now is discussed hereafter. 1)Control systems: a)At the time Al Fiorini was running the company: The company showed rapid growth potential. He performed background checks of employees. Al monitored activities of loan officers by their tracking number. Great goodwill that the company got loans on wholesale rates. b)At the time Al left to earn his MBA: Al used several types of control systems while he was away in California. He used a combination of controls which consisted of action, result and performance controls. Examples of action controls are as follows: Authority to write checks was withheld by Al. Keeping a check on Joe’s attendance and terminating the agreement when he failed to show up. Spent four hours a day talking on the phone to his employees to observe their behavioral patterns. Centralized decision making (where Al was the central body). All business mails received at his California address. Supervised the loan applications electronically. Observed the progress of every...
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...Short Summary Atlanta Home Loan April 2002 - Al formed Atlanta Home Loan (AHL), a mortgage lending and financing company, in Atlanta, Georgia - Initial investment of $40,000 - Operated the company from his home Summer 2002 - Company grew rapidly - 4 telemarketers and 8 loan officers who all worked from their homes - Established banking relationships which allowed clients to borrow at wholesale rates - Rates varied according to client FICO scores The Company - Leads were bought from list brokers - Telemarketers called people on the lead lists to assess their interest in refinancing - The lists were then passed on Al who distributed them to the loan officers - Loan officers helped with the applications and ordered an appraisal and credit report - Admitted for EMBA in California, Al had several options for AHL - As the company was appraised for $600,000 and was continuing to grow, he decided to find someone to operate the business in his absence Back to School - June 2002 A Partner- July 2002 - Impressed by Joe's sales ability and being people oriented, the two reached a verbal partnership agreement - Joe would invest $8,400 and be entitled to half of the profits - Al soon found out Joe was irresponsible and terminated the agreement while appointing a new manager that lasted 3 days prior to rehiring Joe A New Partner and licensing agreement - Sept 2002 - As Joe neglected his responsibilities once again, Wilbur, an acquaintance of Joe, was then hired and given the use...
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...day to operations or for starting up a new project. One of the important sources of raising finance is loans from banks. Commercial lending is one of the prime functions of any bank. But how does the bank appraises the creditworthiness of a borrower? What are the criterions to be fulfilled for granting loans? What are the tools used by the banks to appraise the loan proposal? These questions are being answered in this paper. This paper describes the credit appraisal process followed in Allahabad Bank. * Assistant Professor, Department of Accounting and Finance, Amity Business School, Amity University, Noida. A Monthly Double-Blind Peer Reviewed Refereed Open Access International e-Journal - Included in the International Serial Directories Indexed & Listed at: Ulrich's Periodicals Directory ©, U.S.A., Open J-Gage as well as in Cabell’s Directories of Publishing Opportunities, U.S.A. International Journal of Management, IT and Engineering http://www.ijmra.us 537 May IJMIE Volume 2, Issue 5 ISSN: 2249-0558 2012 ___________________________________________________________ Companies can avail a variety of credit facilities from banks for meeting the requirement of funds. The various credit products which can be availed are listed belowFunded Credit Facilities- it refers to those facilities where transfer of funds takes place Overdraft Cash Credit Term Loans ( long term finance) Bill discounting Non Funded Credit Facilities- it refers to those facilities where...
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...period last year. S Chandrasekharan, executive director, UCO Bank, told NDTV Profit that the bank was not planning to take up any major restructuring this year. “Our focus of the year is going to be retail advances,” he said. Profit this time has been lower than expectations, falling 23 per cent sequentially. What led to the same? Yes. The pressures were mainly because of the slippages. We expect around Rs. 840 crore this quarter, and otherwise if you see year-on-year profit, it is much higher than what it was. We could make 22.3 per cent year-on-year from Rs. 907 crore last year to Rs. 1109 crore this year. Only on quarter-to-quarter, the profit has come down. Credit and deposit growth have been a bit sluggish, and consequently your loan-to-deposit ratio (LD ratio) has inched up. Any pressure you are facing on funding side? No. There is no pressure on us. We took a conscious decision of not accepting bulk deposits this year. The deposit growth as per the industry is 6 per cent. We even did not take any bulk deposit last year as there was a 32 per cent growth in bulk deposits this year (This doesn’t read right. Last year…this year…). The credit (deposit) has gone up to about 16 to 17 per cent. We don’t see any pressure on liquidity. How were the net interest margins (NIMs) during the quarter? Your current and savings account ratio (CASA) dropped in the third quarter. This time how did it pan out? The CASA has improved as compared to last year and one good thing is...
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...have completed the project titled HOME LOAN WITH PREFERANCE TO DHFL as a part of the course recquiremts of B.M.S of University of Mumbai. I further declare the info presented in this project is true and original to the best of my knowledge. Acknowledgement A successful project can never be prepared by the single effort or the person to whom project is assigned , but it also demand the help and guardianship of some conversant person who helps in the undersigned actively or passively in the completion of successful project. With great pleasure I express my gratitude to our B.M.S co-ordinator prof. Shruti and project guide Prof. Sujata without their help this would not have been completed. They have given their precious suggestions and constructive guidance has been indispensable in the completion of this project work. I would also like to thank the staff of the VPM S’ COLLEGE. They have supported me in this endeavor, and appreciated me in my efforts during my project. Last but not the least I would also like to thank my friends and all the responded. Who directly and indirectly supported to me during my project work, without the help of whom this project would not have been possible. CHAPTER: - 1 GLOBAL VIEW OF HOME LOAN History of home loan in medieval period Before discussing history of loan, let us understand what is exactly meant by the term ‘loan’. Loan is a type of debt. Like all debt instruments, a loan entails the redistribution of financial...
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...HDFC BANK INTRODUCTION HDFC (Home Development Finance Corporation) Home Loan, India have been serving the people for around 3 decades and providing various housing loan according to their varied needs at attractive and reasonable interest rates. Owing to their wide network of financing, HDFC Home Loans provide services at doorstep and helps you find a home as per your requirements. COMPANY PROFILE HDFC Limited founded in 1997 by Ravi Maurya and Hansmukh bhai Parekh, is an Indian NBFS focusing on home loans. HDFC operates through almost 450 locations throughout the country with its corporate head quarters in Mumbai, India. HDFC also has an international office in Dubai, UAE with service associates in Kuwait. HDFC is the largest housing company in India for the last 27 years. HDFC was amongst the first to receive an in principal approval from RBI to set up a bank in the private sector, as a part of the RBI’s liberalization of the Indian banking industry. It was incorporated onincorporated on 30th august 1994 in the name of ‘HDFC Bank Limited’, with its registration office in Mumbai. HDFC began its operations as a scheduled commercial bank on 16 January 1995. HOME LOAN PRODUCTS • Home Loan: Home loans for individuals to purchase (fresh / resale) or construct houses. Application can be made individually or jointly. • Home Improvement Loan: The interiors of any home reflect the personal preferences and tastes of its owners making it...
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...years the demand of home loans has increased dramatically. Part of the reason for this increase is because of accessibility of loans has gotten bigger. Today home loans are available in the market at very low and good rates that meet the demands of many home buyers. A home represents the largest asset that typically people have and this is why home loans have such a huge impact in the loan market today. When a person purchases a home he or she will be investing a huge amount of cash. Many people can’t come up with the whole money to pay out to the house, while some others can’t even afford to invest money for the house they will like to purchase in part this is how home loans have turned out to be a benefit for people who want to buy the home of their choice but cannot afford it at the time. Now day’s home buyers don’t have to worry much about the source of money for their homes. Home loans have made the life of many house buyers much easier. But house buyers should be very careful when choosing a home loan. Before doing anything else. Borrows should make a through research of the current interest rates in the market and then opt or go for any home loan. Buyers could even go for home loans by mortgage. This way the borrowers can get a loan after pledging or securing any asset or securities of their own against amount of money barrowed by them. When getting a home loan the individuals should consider taking care of different aspects related to the home loan. An individual should...
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...Financial position of the clients, their capability to repay the loan and the actual Credit required by them for their business. During this project another main task was to identify the Pre – Sanction and the Sanction Process of LOANS. The study is grounded on the analysis of Financial Reports of the Clients. My study also included how working in the district and what is there performance there. 2.1 INTRODUCATION OF THE SYUDY Decision about housing is among the most important financial decision most of the people ever have to make. Buying a home is a major commitment, and home payments take a big chunk of the family budget. In 1970s, home payments took about one-quarter of a family’s take-home pay. People bring about 1/3rd of their salary to their home now. Home ownership has a number of advantages over renting. Mortgage payments are like “force savings”, making one’s house an investment, not just a place to live. He may have better quality of life if he buys instead of renting. He can do whatever he wants to the house and free to improve or change it to suit his needs. He may enjoy more privacy if he owns his own home. He will have...
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...make it possible for you to purchase your home including – realtors, inspectors, title insurer, insurance agent, appraiser, and the attorney. On your mortgage team, you will meet your processing specialist, while the underwriter, closer, and any other investors or government agencies that might be involved in your loan process are working on your file. The normal mortgage loan process takes between 30 and 45 days from application to closing. When you begin planning for a home purchase, you will need to meet with a banker and get pre-qualified, then find just the right home, obtain your mortgage financing and complete all of the home inspections, and close on your new home. You will start the complete purchasing process with a trip to the bank to speak with a loan officer to get pre-qualified, which consists of going through an interview and documentation process. The banker will ask questions such as whether this will be your first home, primary residence, or whether you have a house to sell before you plan to close on a new one. The bank will require you to fill out a mortgage loan application. You will need to supply the bank with pay stubs and other income documentation, bank statements and retirement statements, picture identification, and your social security number among other things. Then the lender will review all the information that you have provided and help you to determine how much money you can borrow and what your best loan options will be. Now you are ready to...
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