A

SUMMER TRAINING REPORT

ON
CUSTOMERS PERCEPTION TOWARDS HOME LOAN
OF State Bank of

Patiala LTD.

Submitted to
Punjab Technical University ( PTU
)
In Partial Fulfillment of the Requirement for the
Award of Degree of
Masters of Business Administration
( MBA )
Supervised by:Submitted by:Dr. ..
xxxxxxxxxxx

Roll no.- ..

Global Institute of Management and

Emerging Technologies
Amritsar
(Session 2013-2015)

CERTIFICATE
This is certify that the summer training report titled Customers Perception towards Home
Loan Of SBP Ltd. being submitted by Divya Dewan to the faculty of management Global
Institute of management, Amritsar for the award of degree of MBA is a bonafide piece of work
carried out by her under my guidance. This summer training report has not been submitted in part
or in full to any other university or institution for the award of a degree. This research report is fit
to be considered for the award of MBA degree

Dr.Shelly
(Assistant Professor)
Global Institute of Management, Asr

Declaration

I hereby declares that the summer training report entitled Customers perception towards
home loan submitted by me to Global Institute of management and emerging technologies,
Amritsar is a bonafide work done by me and this has not been submitted in part or full to his or
any other university / institution for the award of any degree. If anything found copied, I would
be solely responsible for that.

( xxxxxxx )
Signature of the student

Acknowledgement

The success and final outcome of this project required a lot of guidance and assistance from
many people and I am extremely fortunate to have got this all along the completion of my project
work. Whatever I have done is only due to such guidance and assistance and I would not forget
to thank them.
I respect and thank Mr. xxxxxxxxxx, for giving me an opportunity to do the project work in
Consumer perception towards home loan and providing me all support and guidance which
made me complete the project on time. I am extremely grateful to his for providing such a nice
support and guidance though he had busy schedule.
I would not forget to remember all faculty members for their unlisted encouragement and more
over for their timely support and guidance till the completion of my project work.
I heartily thank my college project guide, xxxxxx for her guidance and suggestions during this
project work.
I am extremely thankful to all those persons who have positively helped me and customers who
respond my questionnaire, around whom the whole project cycle revolves.

(xxxxxxx)

Signature of the student

Table of Contents

Chapter No.
1.

Contents
Introduction
Industry profile
Company profile

2.
3.

About the company

Profit/Loss account
Balance Sheet
Mission and Vision

Page No.
1-39
1-7
8-14
8-11
12
13
14

Introduction to Home Loan

Home Loan
Advantages of Home Loan
Disadvantages of Home Loan
Disbursement of Home Loan
Types of Home Loan
Stages of Home Loan

15-39
15-16

SBP Home Loan Scheme

32-39

Review of Literature
Research Methodology

17
18
19-24
25-29
30-32

40-43
44-49

Objectives of study
Sampling Plan

44

Sources of Data
Presentation tools

45-46

Limitations of study

48

45

46

4.

Data Analysis and

50-63

5.

Interpretation
Conclusion and

64-66

6.
7.

Recommendation
Bibliography
Annexure

67
69-73

INTRODUCTION

Industry profile

The housing sector plays an important role in the economic development of the country. Every
rupee invested in housing adds 78 paise to the GDP. Over 269 industries are directly or indirectly
dependent on the housing sector. There is an estimated shortage of 20 million housing units in
the country with an estimated investment requirement of over Rs 1500 billion. In this context it
is important to note that that the organized housing finance industry barely accounts for 30% of
the home loans disbursed in the country. The last few years have seen the home loans market
growing at a CAGR of over 30 percent. The growth has been mainly fuelled by certain fiscal,
social and regulatory drivers:
Changes in demographic profile including increase in the rate of household formation due to
structural shift from joint family system to nuclear family
Ever increasing middle class, migration of population and increasing urbanization resulting in
acute shortage of housing units.

 Increase in disposable income levels due to decrease in marginal tax rates and increase in total
income levels
Tax benefits and other fiscal incentives announced in the Union Budgets
Increasing affordability of housing property purchase due to declining interest rates and stable
property prices
Decline in the average house cost to annual income ratio to around 4-5 from 11-14 during the
last decade resulting in an affordable EMI as a percentage of monthly income
Aggressive lending by banks to the housing sector due to lower credit off take by the corporate
sector, attractive spread and lower non-performing assets

The major players in Indian housing finance industry are the Housing Finance Companies
(HFCs), Scheduled Commercial Banks, and Co-operative Banks. The total incremental
disbursements of the HFCs and the Banks have increased from approx Rs 16,000 cr in 1998-99
to approx. Rs 39,000 cr in 2002-03 with direct incremental disbursements growing from approx
Rs 10,500 cr to Rs 34,000 cr during the same period. The year 2002-03 has witnessed a growth
of 29 percent in total incremental disbursements and 33 percent in direct incremental
disbursements over that of last year. Total incremental disbursement less Bank loans to HFCs,
Bank investments in NHB/HUDCO Bonds and Bank loans to employee.The incremental
disbursements of HFCs is estimated to have increased by 21 percent to approx. Rs 18,000 cr
with incremental disbursements of HDFC, the leading HFC increasing 31 percent from Rs 7,616
cr to Rs 9,951 cr during 2002-03. However, the aggregate market share of HFCs as a whole
declined. The HFCs have mostly lost market share to the banks with the worst hit being inflicted
on the small and medium HFCs.

Financial institutions and their services offered:

ICICI bank:
ICICI Bank offers wide variety of Loans Products to suit the customer requirements. Coupled
with convenience of networks branches/ATMs and facility of E-channels like Internet and
Mobile Banking.
Home loan:

Attractive interest rates

Door-step service from enquiry stage till final disbursement
Can transfer the customer existing high-interest rate loan
Free personal accidental insurance
Special 100percentage funding for select properties

HDFC Bank:
Home loan:
A new home brings with it new hopes, joys and emotions. At HDFC, we have shared new hopes,
joys and emotions with over 26 Lakh customers. Every customer has a specific and unique
concern. Having earned an experience of 27 years in home loans, our home loan product is
customized to provide the customer solutions for the customers unique concern.
Features:

Maximum loan 85percentage 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 the customers 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- applicants.
However, the co-applicants need number be co-owners.

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.
Self Construction
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.)
Existing Customer 100percentage of the cost of improvement
New Customer 5percentage of the cost of improvement

Adjustable Rate Home Loan

Loan under Adjustable Rate is linked to HDFC's Retail Prime Lending Rate (RPLR). The rate on
the customers loan will be revised every three months from the date of first disbursement, if
there is a change in RPLR, the interest rate on the customers loan may change. However, the
EMI on the home loan disbursed will not change*. If the interest rate 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.

State Bank Of India (SBI)

Housing Loan:
Home is where the heart is! At SBI, we understand this better than most the toil and sweat that
goes into building/ buying a house and the subsequent pride and joy of owning one. This is why
our Housing loan schemes are designed to make it simple for the customer to make a choice at

least as far as financing goes!

Unique features:

Insurance from SBI Life at confessional premium (Upfront premium financed as part of

project cost)
Interest applied on daily diminishing balance basis
Plus schemes which offer attractive packages with confessionals interest rates, margins
and processing fee to Govt. Employees, Teachers, Scientists, Employees in Oil sector,

Journalists (in select cities) etc.

Special scheme to grant loans to finance Earnest Money Deposits to be paid to
Urban Development Authority/ Number cap on maximum loan amount for purchase/

construction of house/ flat

Option to club income of the customers spouse and children to compute eligible loan
amount. Provision to club expected rent accruals from property proposed to compute

eligible loan amount

Provision to finance cost of furnishing and consumer durables as part of project cost.

Axis bank home loan

Axis Bank offers affordable and flexible housing loans that can turn your dream of owning a
home into reality.
If rising real estate prices have pushed the house you coveted beyond your budget, Axis Banks
unmatched home loans will put it within reach. The attractive interest rates and minimal
processing fees make our home finance products a first choice for savvy buyers. In addition,
features such as flexible tenures, transparent processing and quick service have made our
products stand out among the best home loans in India.

We have products to suit every budget, taste and need. Whether you are self-employed or
salaried, want a floating or fixed rate, Axis Bank will offer a loan that is just right for you.
Features of Axis Bank Home Loans
Axis Bank housing loans are designed for todays home-hunter. Our easy home loans are rich in
features and offer a number of benefits.
Attractive interest rates: We offer attractive interest rates that make your housing loans
affordable and easier on your pocket every month.
Flexible rates: Choose between fixed and floating rate options depending on which way you
think interest rates are moving.
Balance transfer facility: Not satisfied with your existing Home Loan provider? You can
transfer your Home Loan to us without any hassles.
Doorstep service: You don't have to go the bank for Home Loans; the bank will come to your
doorstep. Perfect for those leading busy lives.
Quick and transparent processing:
Special Benefits available for Premium Banking customers.

Oriental Home Loan

Housing loan scheme is the nomenclature of Orient Home Loan. Henceforthe housing loan
scheme shall be called Oriental Home Loan for all practical purposes including advertisement.
Purpose:

Purchase of house and construction thereon.

Construction of house, where in the plot/land already owned by the applicant.
To buy built up (new or second hand) /semi built up house or flat.
To extend/improve/repair , the existing house or flat.
To buy a flat under construction or proposed to be constructed.

For home furnishing, furniture/fixtures embedded to structure or otherwise.

To take over of housing loan from other banks / other financial institutes.

Company profile

State Bank of Patiala is an associate bank of State Bank of India. State Bank of Patiala (SBP),
originally named Patiala State Bank, and currently an associate bank of the State Bank of India,
was founded on 17 November 1917. SBP was founded by Maharaja Bhupinder Singh,
Maharaja of the princely state of Patiala of Undivided India, and the functions of the Bank
included the normal functions of commercial banks, as also some functions similar to functions
of a central bank for the princely state of Patiala.
After Indias independence, the Bank was made a wholly owned subsidiary of the Government
of Punjab. On 1 April 1960, SBP was accorded the status of an Associate bank of the State Bank
Group. Presently, the State Bank of Patiala has a network of 1035 service outlets, including 1010
branches, in all major cities of India, but most of the branches are located in the Indian states
of Punjab, Haryana, Himachal Pradesh, Rajasthan, Madhya Pradesh, Jammu &
Kashmir, Delhi and Gujarat.

History

The rich heritage of State Bank of Patiala dates back to the year 1917, when it was founded by
Late His Highness Bhupinder Singh, Maharaja of erstwhile Patiala state, with one branch by the
name of 'Chowk Fort, Patiala' to begin with. The Bank, then known as the 'Patiala State Bank'
was state owned and setup for the explicit purpose of fostering growth of agriculture, trade and
industry. The constitution, scope and operations of the Bank underwent a sea change with the
formation of the Patiala and east Punjab States Union (PEPSU) in 1948.The Bank was then
reorganized and brought under the control of Reserve Bank of India.

It was christened as the Bank of Patiala. Another milestone in history of the Bank was its
becoming a subsidiary of the State Bank of India on 1st April,1960 when it was named as the
State Bank of Patiala and since then it has grown significantly both in size and volume of
business. During these glorious years, the Bank has been playing an important role in Banking
sphere.
Our Bank has now added a golden chapter to its history by fully networking all its brances on
Core Banking Solutions on 08.08.2005 and become the first fully networked Public Sector Bank
in the country.

Logo and Slogan

The logo of the State Bank of Patiala is a blue circle with a small cut in the bottom that
depicts perfection and the small man the common man - being the center of the bank's
business. The logo came from National Institute of Design (NID), Ahmedabad and it was
inspired by Kankaria Lake, Ahmedabad.

Slogans: "PURE BANKING, NOTHING ELSE", "WITH YOU - ALL THE WAY", "A
BANK OF THE COMMON MAN", "THE BANKER TO EVERY INDIAN", "THE
NATION BANKS ON US.

General information
Powers
The Bank has delegated financial powers in respect of Advances and General Matters to its
different functionaries through internal instructions. This includes financial powers delegated to
various Committees like Head Office Credit Committee (HOCC)-I, Head Office Credit
Committee (HOCC)-II, Head Office Credit Committee (HOCC III) and Zonal Office Credit
Committees.

Duties
The duties of the Officers and employees are broadly described in the Officer Service
Regulations and Award Staff Bipartite settlements, which are settlements at the Banking Industry
Level. This apart, the Bank has internally issued various guidelines, instructions regarding the
duties to be performed for various functional areas.

Channels of Supervision
Bank has well established channels of supervision for managing its day to day operations. The
Bank follows the 'Maker and Checker' principle for its financial transactions, which are now
under computerized system. This apart, the Controlling Offices, Zonal Offices and Head Office
through official visits/ periodical meetings supervises the operations of various functionaries.
Various checks/inspections through Audit i.e., Internal/Statutory/RBI etc., are done to ensure
proper conduct of banking transactions.

Accountability
The Bank has approved policy for examining accountability through Disciplinary process for
Award Staff and Officers separately. A separate Vigilance Department has also been set up at the
Bank's Head Office.

Norms set to discharge its functions

The Bank has laid down norms for acceptance of deposits, sanction of advances and other
ancillary banking services like Lockers/Remittances/Cross Selling/Collections etc.
Rules, Regulations, Instructions, Manual and Records
There are a number of documents like Book of Instructions, Manuals, and Codified Circulars etc.
Bank has well laid down and approved Policies, Rules, Regulations, Instructions, Manuals used
by the Bank for discharging its various functions. We give a list of some of such guidelines as
under:

List of Policies framed by the Bank for different purposes

Investment Policy.

Domestic trading Policy.

Policy on Derivatives.

Operational Risk Management Policy.

Integrated Risk Management Policy.

Outsourcing Policy.

Mobile Banking Policy.

Policy on Disclosures under Pillar-III.

Credit Risk Mitigation and Collateral Management Policy.

Credit Risk Management Policy.

ICAAP Policy.

STATE BANK OF PATIALA

Profit and Loss account for the year ended 31st March 2014
Particulars
I.

II.

Income
Interest earned
Other Income
Total
Expenditure
Interest expended
Operating Expenses
Provisions and contingencies
Total

Schedule

Year ended 31st

March 2014

Year ended 31st

March 2013

13
14

101566084
8712852
110278936

95642626
7588247
103230873

15
16

75604861
20190969
10007066
105802896

71134267
16678512
8750543
96563322

III.

Profit
Net Profit for the year
Profit brought forward
Total

Appropriations
Transfer to Statutory reserves
Transfer to other reserves
Transfer to Capital reserves
Interim Dividend(including
Tax thereon)
Proposed Dividend(including
Tax thereon)
Transfer to/from Investment
Reserve Account
Transfer to Special Reserve
under Sec.36(1)(viii) of
Income Tax
Transfer to SBOP Retired
Employees Medical Fund
Total
Earning Per Share
Significant Accounting Policies
Notes to Accounts

4476040
0
4476040

6667551
0
6667551

1119010
2245807
219996
11700

1666888
2591971
58702
1057625

-150473

192365

1030000

1100000

4476040
151.55

6667551
226.21

IV.

17
18

STATE BANK OF PATIALA

BALANCE SHEET AS ON 31st MARCH 2014
Schedule

As on 31st March

As on 31st March

2014

2013

Capital & Liabilities

Capital

3678500

2947500

Reserves and Surplus

57635582

50471941

Deposits

896731563

886720838

Borrowings

123862347

88406010

Other Liabilities and Provisions

59299347

56959979

1141207339

1085506268

81457707

40072469

2039731

597303

Investments

245811100

239566611

Advances

759365586

737997914

Fixed Assets

10

4106688

3414523

Other Assets

11

48426527

63857448

1141207339

1085506268

305876633

390886484

40394429

60482078

Total
Assets
Cash & Balances with Reserve
Bank of India
Balances with banks & money at
call & short notice

Total
Contingent Liabilities

12

Bills for Collection

Significant Accounting Policies

17

Notes to Accounts

18

Vision
Te be amongst most trusted power utility company of the country by providing environment
friendly power on most cost effective basis, ensuring prosperity for its stakeholders and growth
with human face.

Mission

To ensure most cost effective power for sustained growth of India.

To provide clean and green power for secured future of countrymen.

To be a technology driven, transparent organization, ensuring dignity and respect for its
team members.
To continuously upgrade & update knowledge & skill set of its human resources.
To achieve excellence in every activity we undertake.

Introduction to Home Loan

Every human being aspires to have his own house to live in. After food and clothing, housing is
the third most important human requirement. On an average a person spends almost two-thirds of
his life in a house which is his sanctuary in his old age. Adequate housing is therefore a
fundamental need of human beings and an essential pre-requisite for physical, intellectual and
mental development. Blessed are those who live in their own house and fortunate are those who
have the money to buy one. But all are not privileged to buy a house of their own. For many such
less privileged, buying a house has become possible in modern times through housing loans.
Though shelter was enshrined as a fundamental right in the constitution, housing did not get the
attention it reserved. This was perhaps due to the fact that at that time nobody expected the
problem of housing to assume the present gigantic proportions. Proper housing, even at a lower
scale, has never kept pace with the minimum requirements of the people. The objective of this
report is to study Customer Perception and Attitude towards home loan. For this survey
was conducted through structured Questionnaire. In todays competitive business world every

customer is significant for the lending home loan. The customer expectations are very high so it
should be kept in mind and offer them best possible service.
The housing backlog has been compounded by the high
rate of population growth. Inadequate housing facilities have led to the rapid growth of slums
and unauthorized settlements, poor quality of services, housing land prices and increasing costs
of construction. In rural areas, the situation is even more alarming. The Government and some
public sector undertakings have been trying to tackle the problem but their efforts do not much
even the fringe of the problem. The central and state governments cannot solve this problem. So
the Life Insurance Corporation of India and housing societies entered the field of housing loans
for their customers. Today these are 350 housing finance companies registered with the registrar
of companies, of these 29 have been approved by National Housing Bank for financial
assistance. The housing finance industry has been borrowing at the rate of nearly 35% for the last
two years. Over the last 3 years Commercial banks and Private sector banks have been playing
an important role in housing finance. All Commercial banks and Private sector banks are now
emerging as lenders in the segment, taking a slew initiatives in the form of opening dedicated
outfits/cells to cater to the ever-increasing demand for housing loans, offering competitive
interest rates with fixed/ variable options, Waiver of processing fee, Free additional attractive
packages and flexibilities in housing loan Schemes. Generally the traditional trend of the term
Housing Loans or Housing Finance means finance for buying or modifying a property.
Hence Housing Finance may be defined as the financial resources for an individual or a group
of persons used facially for the purpose of housing. A study of the housing loan schemes offered
by public sector banks and private sector banks would pave the way taking certain policy
decisions for improving these housing loan schemes.

ADVANTAGES OF HOME LOANS

The various benefits of home loans arising to the customers are :-

1.)Attractive interest rates:The various banks offer attractive interest rates to boost and help their customers. Many banks
provide loans on fixed or floating rates to facilitate consumers as per their needs.

2.) Help in owning a home:The home availed by a person with the help of banks, because they provide
technical and financial assistance to customers for owning their dream
home.

3.) No requirement of guarantor:The commercial banks now a day, liberalize their laws regarding home loans.
Some of banks dont even require the guarantor to grant loan to their
consumers. They also make consumers free by reliving him to find a
guarantor to complete the proceedings of availing loan.

4.) Door step services:These door to step services are provided from enquiry stage to the final
disbursement takes place such services are beneficial for customers in
present busy life. Banks like ICICI bank and standard chartered bank
provide door to step services to customers to borrow loan.

5.) Loan period:There are many banks which provide maximum loan tenures upto 15-20
years based on the loan amount and the creatibility of customers. This
relieves the customers to repay loan amount till a long period.

DISADVANTAGES OF HOME LOANS

The main disadvantages of home loans are high lightened as below:

1.)Delays in processing :Many times, there are huge delays in processing of providing home loans because
various formulations to be fulfilled in this process. Due to these delays
customers feel mentally as well as financially weak.

2.) Fluctuating interest rates:Some banks give home loans at floating rates, which fluctuate at Different intervals due to some
reasons. These changes sometimes, may lead to increase in interest rate which will increase the
cost of home loans to the customers

3.) High cost:The public sector banks charge high processing cost for home loans sanctioning.
They are forced to pay serious charges at various stages to fulfill the requirements. Some
consumers are not able to pay such charges so such people could not avail the
benefits of home loan schemes.

4.) Problems in Disbursement:There are many problems in disbursement of home loan amount. There are some
delays in disbursement of loan amount to the customers due to legal formalities. This
causes problems to the customers. These are limitations or disadvantages of home loans. But
sometimes some banks charges high installments to repay loan amount. Such also
causes problem to customers

These limitations can be removed by providing good and pro mote services to the customers.

DISBURSEMENT OF HOME LOANS

The every bank has its own procedure to disburse the loan amount among customers. After
choosing your right home, the next step is disbursement of home loans. The loan amount is
disbursed after identifying and selecting the property or home that are purchased and submit the
requisite legal documents. In the disbursement of home loans a clear title and full verification to
ensure that a person has full rights on his house. The 230Aclearance of seller and /or 371
clearances from the appropriate authority of income tax is also needed.

(i.) Eligibility criteria:However, if one is a resident or non-resident individual who is planning to buy a house in India,
one can apply for a home loan. If a person has decided to buy a property in the near future,
he/she can apply for a loan before even selecting the property. Once the maximum amount to put
into the property has been decided, the Housing Finance Institutions or Banks will let the
customer know that how much he/she is eligible for and this helps to plan out the budget.

(ii.)Conditions regarding co-applicants:All Housing Finance Institutions lay down conditions on who can be co-applicants all coowners to the property need to be co-applicants to the loan necessarily. These institutions do not
permit minors to join in as either co owner or as co-applicants because a minor is not eligible to
enter into a contact as per law. They do not permit even friends or relatives who are not blood
relatives to take a property jointly. However, Income of co-applicants can be clubbed together to
get higher loan eligibility. Given below is a Table that throw light on acceptable relationship of a
co-applicant for clubbing of income.

Income Clubbing of Co-applicants:

It is as follows:-Combination Income Clubbing: -

Husband-Wife: Income of husband-wife can be clubbed.

Parent - son:- It can be clubbed if only son is there but not if any male sibling exists.

Brother-Brother:- If they are currently staying together and intend to stay together inthe new property, then only,
their income-can be clubbed for above purposes.

Brother-Sister:- No clubbing-is possible.

Sister-Sister : No clubbing is possible.

Parent-Minor- Child:- No clubbing is possible in this case also.

iii) General Terms and Conditions: -

T h e f o l l o w i n g a r e t h e t e r m s a n d c o n d i t i o n s applicable to the basic home loan

product only. These are likely to change on the basis of the variations of the home loan
product. Typically, in general home loans, the following conditions are applicable :-

The loan to value ratio (LTV) cannot exceed a particular percentage. This differs
from p r o d u c t t o p r o d u c t a n d f r o m o n e H o u s i n g F i n a n c e I n s t i t u t i o n
a l B a n k ( H F I / B ) t o another. The components of the value of the Property
calculated here are covered under cost of property.

The maximum tenure of the bank is nominally fixed by HFI/Bs. However, HFls/Bs
do provide for different tenures with different terms and conditions.

The installment that one pay is normally restricted to about-50-per cent of the monthlygross income of the candidate.

The total monthly outflow towards all the loans that have been availed of, including the
current loan is normally restricted to 50% of the gross monthly income.

One will be eligible for a loan amount which is the lowest as per one's eligibility. This is
calculated as per the LTV norms, the HR, norms and the FOIR norms as mentioned
above.

Most HFls/Bs consider the profile before they judge the repayment capacity. The judgement is
based on age, qualifications, number of dependents, employment details, employer credentials,
work experience, previous track record of repayment of any loans that have been availed of,
occupation, the industry to which the candidate's business relates to, if he/she is self-employed,
then the turnover in the last 3-4 years etc.
Some HFIs/Bs insists on guarantees from other individuals for the repayment of
the loan. In such cases, the customers has to arrange for the personal guarantee
before the disbursement of the loan takes place. T h e p r o p e r t y s h o u l d b e
t e c h n i c a l l y c l e a r b e f o r e t h e H F I s / B s d i s b u r s e s t h e l o a n s amount. Most of
institutions and banks have a teams of technical experts who visit the site to get a technical
report before the disbursement of loan. This is also beneficial to the customer as
they check for the technical quality and compliance with local laws. The property should be
legally clear before one can avail of a disbursement of the loan amount. Housing-Finance
Institutions /Banks (HFIs/Bs) take legal clearance from their lawyers before the
disbursement of amount. This proves to be beneficial to the customers as a legal expert checks
his/her documentation to ensure that he/she get a proper title to the property. The disbursement
of the loan is as per the progress of construction of the property unless it is a ready
property in which case the disbursement will be by one single cheque. PEMI or simple
interest on the loan amount disbursed to the customer in case of a part
disbursement will be payable by the customer on the disbursement. The disbursement in most
cases will be favoring the builder or the seller or the society or the development authority as the
case may be. The disbursement will come in the customer's favour under special circumstances
only. The repayment of loan can be made either through deduction against salary, post-dated
cheques, standing instructions or Auto debit instructions to bank.
T h e a b o v e t e r m s a n d conditions are generally true for most Housing finance
Institutions/Banks with respect to the general Home Loans. However, the specific
terms and conditions vary with respect to special Housing Finance Institutions or Banks.

(iv) Charges applicable to home loans :The different kinds of charges applicable to home loans are discussed below

a.)Processing fees :First of all, comes the process fee. This is a charge that is levied by most
HFls/Bs. This has to be paid at the time of submission of the application form. It's normally
charged as a percentage of the loan amount sanctioned. Some HFls also charge a
flat fee based on the loan amount instead of a percentage. When a lower amount
is sanctioned the excess fees paid at the time of submission of the application is
adjusted with the charges, which one make to the HFI/B subsequently. Most
HFls/Bs refund the processing fee if the loan application is rejected.
b.)Administrative fees :This charge is again, normally, a percentage of the loan amount sanctioned. It
iscollected by the HFI/B for the maintenance of customer's records, issuing interest certificates,
legal charges, technical charges, etc. though the tenure of the loan. It is payable by the customer
when he/she accepts the offer letter given by the HFI/B. This payment has to be made before the
availment of the disbursement. The mode of collection of these fees varies from one HFI/B to
another.

c.)Rate of interest :This is the rate of interest applicable on the loan amount through the tenure of the loan. It is
charged on the principal monthly reducing method. Most HFIs/Bs give an option
to select either a fixed rate of interest or a variable rate of interest.
d) Legal Charges:Some HFIs/Bs mainly Public Sector Banks levy legal charges that they incur on
getting the property documents vetted by their panel of lawyers.

e) Technical Charges:These charges are also levied by certain Housing Finance

Institutions/Banks (HFIs/Bs) to meet their expenses on the technical site visits to the
customer's property. This ensures quality of construction and construction within the
norms as stipulated by the respective approval authority.
f)

Stamp duty and registration charges:-

HFIs that go in for a registered mortgage pass these charges on to the customer. These are
rather heavy in certain states depending on the laws laid down by the state where
one buy a property.
g)

Personal Guarantee from Charges :-

Since the personal guarantee provided by the customer need to be stamped, these
charges are also recovered from the customer. They are charged to him by HFIs who demand for
Guarantees.
h.) Cheque Bounce Charges :In case the cheques through which one make a payment to HFls get dishonored, some minimum
charges are levied by the HFI. The same are recovered from the customer.
i.) Delayed payment charges :HFls/Bs charge delayed payment charges from the customer if he/she delays
the payment of installments beyond the due date.
j.) Additional charges :These are levied as a percentage on the delayed payment charges by most HFls. They are levied
if one fails to pay the dues within the stipulated time after a delay has taken place.

Types of home loans

Housing loans offered by banks are of different types:-

Home Purchase Loans

Home Construction Loans

Home Improvement Loans

Home Extension Loans

Home Conversion Loans

Land Purchase Loans

Stamp Duty Loans

Bridge Loans

Balance Transfer Loans

Refinance Loans

Loans to NRIs

Home purchase loans

This is the basic for the purchase of a new home. If you want to buy a f l a t i n s o m e
society or some already built house, banks and HFCs sanction you
h o m e purchase loans for this process.

Home construction loans

This loan is available for the construction of a new home on a said property. The
documents that are required in such a case are slightly different from the ones you submit for a
normal Housing Loan. If you have purchased this plot within a period of one
year before you started construction of your house, most HFCs will include the
land cost as a component, to value the total cost of the property. In cases where the period
from the date of purchase of land to the date of application has exceeded a year, the land cost will
not be included in the total cost of property while calculating eligibility.

Home improvement loans

These loans are given for implementing repair works and renovations in a home that has already
been purchased, for external works like structural repairs, waterproofing or internal work like
tiling and flooring, plumbing, electrical work, painting, etc. One can avail of such a loan facility
of a home improvement loan, after obtaining the requisite approvals from the relevant building
authority. the following are coming under the home improvement loans:

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.)

Borwell.

Home extension loans

An extension loan is one which helps you to meet the expenses of any alteration
tot h e e x i s t i n g b u i l d i n g l i k e e x t e n s i o n / m o d i f i c a t i o n o f a n e x i s t i n g h o
m e ; f o r e x a m p l e addition of an extra room etc. One can avail of such a loan
facility of a home extension loan, after obtaining the requisite approvals from the relevant
municipal corporation.

Home conversion loans

This is available for those who have financed the present home with a home loan
and wish to purchase and move to another home for which some extra funds are required.
Through a home conversion loan, the existing loan is transferred to the new homeincluding the
extra amount required, eliminating the need for pre-payment of the previous loan.

Land purchase loans

This loan is available for purchase of land for both home construction or investment purposes.

Stamp duty loans

This loan is sanctioned to pay the stamp duty amount that needs to be paid on the purchase
of property.

Bridge loans
Bridge Loans are designed for people who wish to sell the existing
h o m e a n d purchase another. The bridge loan helps finance the new home, until a buyer is
found for the old home.

Balance- transfer loans

Balance Transfer is the transfer of the balance of an existing home loan that you availed at a
higher rate of interest (ROI) to either the same HFC or another HFC at the current ROI a lower
rate of interest.

Refinance loans
Refinance loans are taken in case when a loan for your house from a HFI at a particular ROI you
have taken drops over the years and you stand to lose. In such cases you may opt to swap your
loan. This could be done from either the same HFI or another HFI at the current rates of interest,
which is lower.

NRI home loans

This is tailored for the requirements of Non-Resident Indians who wish to build or buy a
home or property in India. The HFCs offer attractive housing finance plans or NRI investors with
suitable repayment options. On would be entitled for home loans in the range of Rs 5 lakh to a
maximum of Rs 1 crore, based on the repayment capacity, previous credit history and the cost of
the property.

Taking home loans these days has become simpler. With the RBI regularly bring
down interest rates; taking home loans have become extremely easy. Housing loans which were
16.5% to 18% a few years ago fell by 11.5% to 13%. With interest rates going down, people
increasingly number apply to take these loans. Some of the leading banks offering home loans in
India, including ICICI Bank, IDBI Bank, HDFC Bank State Bank, Bank of Baroda, Kotak Bank,
SBI, Standard Chartered Bank and Axis Bank.

Stages of home loan

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The representation shown above is not a perfect copy of the actual process. This is because these
stages are taking place simultaneously and one application is being taken care for by the
experienced employees of both SBP Ltd service centre and SBP Ltd. HUB (also

called the back end office).Also the applicant may be asked to send information or may be asked
questions regarding his requirement and/or his documents for his own
convenience. Hence the loan application may or may not shuttle through different stages:-

Submission of Application Form: After choosing a particular home loan, the customer submits the application form to the housing
finance company (HFC) along with other relevant documents as required by the HFC. They
comprise documents to establish income, age, residence, employment, investments, etc. The
customer also needs to hand over a cheque for payment of an up front (non -refundable)
processing fee of about 0.5-1% of the loan amount to the HFC.

Validation of the Information: In the next stage, HFCs validate the information provided by the customer on the
application form. They usually conduct checks on the residential address of the
customer, the place of employment of the customer, and credentials of the employer. Some HFCs
may insist on a personal interview with the customer and perform a reference check on the
references provided by the customer on the application form.

Issue of Sanction Letter :After due appraisal of customer profile, a sanction letter is issued which contains
details such as loan amount, rate of interest, annual / monthly reducing balance ,tenor of the loan,
mode of repayment and general terms and conditions of the loan. This is the actually the
approval of the money lending procedure by the company. However, the money is sanctioned
only after the documents and the property on behalf of which the loan is being granted is
thoroughly verified.

Submission of Documents: Once the sanction letter is passed, the customer is required to leave the entire set of original
documents pertaining to the property being purchased with t h e H F C a s s e c u r i t y f o r t h e
l o a n a m o u n t s a n c t i o n e d . T h e s e d o c u m e n t s r e m a i n i n t h e custody of the
HFC till the time the loan is fully repaid. Once the documents are handed over to the HFC, they
send all the documents for a thorough legal scrutiny.

Validation of Property: Prior to disbursement, the HFC also conducts a site visit to the customer's property to ensure that
all construction norms have been adhered to properly. Once the HFC is satisfied that the property
is legally and technically clear, they disburse the loan amount. The disbursement from the HFI is
on the basis of the stage of construction of the property.

Payment Procedure: Once all the above mentioned process, the borrower is entitled to take the money from the lender
party. Until such time that the entire sanctioned amount I snot drawn, the customer is supposed to
pay a simple interest on the Actual Amount drawn (without any principal repayments).
The EMI payments commences only after the entire sanctioned loan amount is drawn.

Home Loan Scheme

Nomenclature
Housing Finance Scheme is the nomenclature of HOME LOAN. Henceforth the housing loan
scheme shall be called SBP HOME LOAN for all practical purposes including advertisement.

Scheme Objective- Government/RBI/Bank

The Government of India vide various National Policy Pronouncements have reinforced the
primacy of the Housing sector and emphasized the need to provide shelter opportunities to all. In
pursuance of National Housing Policy of Central Government, RBI has been facilitating the flow
of credit of housing sector. During recent years the housing has emerged as one of the sectors
attracting a large quantum of Bank finance. Therefore, the current focus of RBI regulation is to
ensure orderly growth of housing loan portfolio of the Banks with minimum risk.

RBI Specific Guidelines

The following types of Bank finance may be included under direct housing finance:

Bank Finance extending to a person who is also owing a house in town/village where he
resides, for buying/constructing a second house in the same or other town/villages for the

purpose of self occupation.

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.

However if the applicant intends to have more than two houses, the exposure for the third unit
house onward may be treated as CRE exposure and falls under the definition of income
producing real estate as the borrower may be renting these units and the rental income would be
the primary source of repayment. Further, no loan should also be given in respect of the
properties meant for residential use, which the applicant, intends to use for commercial purposes,
and declares the same while applying for loan.

SBP Home loan scheme

Housing loan continues to be the thrust area for lending for the bank. To accelerate the pace of
home loan financing and establishing the brand image of home loan product, a study was
conducted with the aim to have the best home loan policy. Consequently, a modified and
competitive home loan scheme has been designed not only to suit the requirements of our
prospective customers but also to attract high ticket home loan customers on one of the best
terms of industry.

Highlights

Lowest rate of interest is 10.25%.

For Loan upto Rs.25 lac: 0.25% of loan amt. min. Rs. 1000/Eligibility for loan highest in the industry.
Smplified procedure.
Tailor made repayment option.
Concession in interest on car loan & other retail loans to Home loan borrowers.
Special concession in interest rate to existing depositor & borrower.
Customized scheme for group borrowers with concession in rate of interest.
Top-up loans available to existing borrowers.
The loan should be repaid up to the age of 70 years.
Option for group Mortgage Insurance Scheme is available on low premium..
Flexible repayment options to suit individual needs.
Offer in-house scrutiny of property documents.
Home extension loan for extension of an existing dwelling unit under the

same terms as applicable to home loan.

Fixed Rate, Floating Rate and options to structure loan as partly fixed or

partly floating.
No documentation fee.
No pre-payment penalty.

Purposes

To purchase or construct a new/old house/flat.

To repair/renovate/extend/alter an existing house.

To purchase ready built flat/house/apartment from cooperative Group housing societies/

State Govt. housing Board/other Govt. agencies/ private builders of repute.

To furnish/purchasing consumer durables for a new house under Total Home Loan

Scheme.
To buy a flat under construction or proposed to be constructed.
For home furnishing, furnitures / fixtures embedded to structure or otherwise.
To take over of housing loan from other Banks/other financial institutes.

Eligibility:

Purchase of flat, raw house, bungalow from developers.

Purchase of existing freehold properties.
Purchase of properties in an existing or proposed cooperative housing society or

apartment owners association.

Purchase of first Power Of Attorney purchases in Delhi for DDA flats allotted before

1992.
Construction of own house.

Normally individuals over 21 years of age with a steady source of income will be eligible to
avail loan under the scheme. The loan should be repaid up to the age of 70 years.

Loan Amount:No limit, subject to:-

Net Annual Income (NAI)

EMI/NMI Ratio

Upto Rs. 2 lacs

40.00%

Rs. 2 lacs to Rs. 5 lacs

50.00%

Above Rs. 5 lacs

55.00%

For repair/renovation etc.

90% of the project cost i.e. estimated cost of repairs, renovation or alteration with a ceiling of
Rs.10.00 lacs.

Loan to Value Ratio:Up to Rs. 20 lacs:- 90% Above

Above Rs. 20 lacs to Rs. 75 lac :- 80%
Above Rs. 75 lac:- 75%

Repayment:

25 years under Floating interest rate option.

10 years under Fixed interest rate option.

( Base Rate = 10.25% p.a.)

Loan
Amount

Upto Rs. 30
Lacs
Interest Rate
(Per Annum)

Above Rs. 30
Lacs and
upto Rs. 75
Lacs

Above Rs. 75
Lacs

Linkage with
Base Rate over
the tenor of the
Loan

Present
Effective Rate

At Base Rate

10.25%

At Base Rate

10.25%

At Base Rate

10.25%

INTEREST RATES UNDER FIXED

OPTION
12.75% p.a. but repayment permitted up
to 10 years only with 2 year reset clause.

Processing Fees

For Loan upto Rs. 25 lacs: 0.25% of loan amt. Min.

Rs.1000/For Loan above Rs. 25 lacs and upto Rs. 75 lacs: Rs.
6500/For Loan Above Rs. 75 lacs: Rs. 10000/DURING CAMPAIGN PERIOD (EXTENDED
UPTO 31.08.2014)
A Flat Rate of Rs.1000/- Per Application, Irrespective
of Loan Amount and Tenor of Loan

PrePayment/preclosure No pre-payment / pre-closure penalty for all Home

penalty
Loans

Loan available

At all branches of State Bank of Patiala.

Review of Literature

Review of Literature

Mylonakis (2007) in his study on Customer Preferences in the Home Loans Market concluded
that the important influential factors attributed are the various offers of banks, the banks
reputation, existing cooperation, as well as bank staff. Bank branches proved to continue
constituting the organization.
Chaudhary and Janjhua (2011) examined the satisfaction level and problems faced by
customerswhile availing loans. A sample of 120 customers of the bank comprising of public
servants, private sector employees and self-employed from its three branches serving Solan
town, Chambaghat and Parwanoo areas has been selected. They found that the customers of the
bank were highly satisfied with the home loan services in relation to its services, transparency,
time taken for loan approval, employee co-operation and query handling, prima facie of some
problems like procedural delays, lack of knowledge and red-tapisim. The results further revealed
that the main reason for people to prefer this bank is the trust of the customers in the bank, lower
interest rates and easy repayable installments.

Vanaja and Sindhuja (2013) studied the customers perception on the home loans offered by
HDFC Limited, the factors influencing customers in choosing a housing finance agency, reasons
for pre closure of home loans and customers opinion about the Electronic Clearing Service of
HDFC Limited. The study showed that on a majority, the customers agree that the peoples
service, products and processes are effective. The company can improve the service of updating
repayments and conveying information about RBI guidelines and interest rate changes by
enabling automatic generated SMS or e-mails to be sent or through tele calling the customers
within a time limit of one or two weeks. The major factors that influence customers in choosing
housing finance company are competitive interest rate, flexible repayment system, progressive
funding and prepayment penalty, which if focused by HDFC can attract new customers and can
also retain loyal customers in the long run. Awareness about the home loan products can be
created through display boards within the office and newspaper inserts.

Research Methodology

RESEARCH METHODOLOGY

The present study is an attempt to research Customers Perception Towards Home Loan of
SBP Ltd.. This chapter discusses in detail the objectives and the sample of the study.
Presentation tools along with the limitations of the study are also discussed.

OBJECTIVES OF STUDY
There is no strongest foundation for your dream home, than a cheap loan. Home loans
have become that stronger foundations for people who want to own a home. The main objectives
of the study are as follows :The main objective of this study is to know the Customers perceptions about home loans of
SBP LTD.

To study the satisfaction level of customers about home loans.

To study the problems faced by customers in obtaining the home loans.

To learn about various aspect of SBP home loan ltd.

SAMPLING PLAN: -

Sampling size: This refers to the number of items to be selected from universe. 60 respondents
were selected.
Sampling Technique: Sampling Technique used in this study is judgemental Sampling.

SOURCES OF DATA: Primary Data: Primary Data has been used in the present study. Survey method was adopted for collecting
primary data. Survey is conducted through questionnaire.

Data presentation tools:- Pie Diagram.

LIMITATIONS OF THE STUDY: Although I have done sincere efforts to collect the authentic and relevant information, But no
study complete in itself, however good it may be and every study has some limitations:

TIME AND COST: - Time and cost are some of the factors that have affected the survey,
so the picture may not be so accurate.

LIMITED SCOPE: - Study is confined to the region of Amritsar only.

SMALL SAMPLE SIZE: - Small sample size has been taken; the possibility of
sampling errors cant be ruled out in the research study.

HARD TO FETCH INFORMATION:- Customers are not willing to disclose all the
information.

GAP BETWEEN TRUTH AND OBSERVATION:- Since the study is based on pre
designed questionnaire there is possibility of error due to the gap between truth and
observation.

Data Analysis and Interpretation

Analysis and Interpretation:This analysis is based on the responses given by customers through questionnaires:-

Age group of surveyed respondents

Age group
26 35 years

No. of Respondents
30

Percentage
50%

33%
36 49 years

20

50 60 years

10

17%
100%
Total

60

26 - 35 years
36 - 49 years
50 - 60 years

Analysis :- From the chart above we find that 50% of the respondents fall in the age group of
26-35 years, fall in the age group of 33% of respondents fall in the age group of 36 49 years .

Education qualification of respondents

Sr. No.

Category

No. of respondents

Percentage

Under graduate

10

17%

Graduate

30

50%

Post graduate

20

33%

Total

60

100%

Under graduate
Graduate
Post graduate

Interpretation:From the table and graph above it can be seen that:

17% respondents are under graduate.

50% respondents are Graduate.

33% respondents are post graduate.

Customer profile of surveyed respondents:Percentage

Occupation

No. of respondents

Professional

20

Self-employed

15

Salaried

15

Others

10

33%
25%
25%
17%

Total

60

100%

Professional
Self-employed
Salaried
Others

Interpretation:From the table and graph, it can be seen that:

33% of respondents are working professionals.

25% of are self-employed.

25% are salaried and rest 17% of respondents belongs to other category.

Annual household Income:Sr. No.

Category

No. of respondents

Percentage

Less than 1 lakh

28

47%

1 5 lakhs

15

25%

5 10 lakhs

12

20%

More than 10 lakhs

8%

Total

60

100%

Less than 1 lakh

1 - 5 lakhs
5 - 10 lakhs
More than 10 lakhs

Interpretation:From the table and graph above, it can be seen that:

47% respondents annual household income is less than 1 lakh.

25% respondents annual income is between 1 to 5 lakhs.

20% respondents annual income is between 5 to 10 lakhs.

8% respondents annual income is more than 10 lakhs.

Purpose of Home loan

Purpose

No. of respondents

Percentage

Home construction

25

42%

For renovation

15

25%

Land purchase

15

25%

Home purchase

8%

Total

60

100%

Home construction
For renovation
Land purchase
Home purchase

Interpretation:From the above table and graph, it can be seen that:

42% of respondents purpose of taking home loan is home construction.

25% of respondents purpose is for renovation.

25% of respondents for land purchase.

8% for home purchase.

Reason for getting it financed:Percentage

Reason

No. of respondents
50%

Non availability of funds

30
25%

Reluctance to pay cash in go

15

25%
Tax benefit

15

Total

60

100%

Non availability of funds

Reluctance to pay cash in
go
Tax benefit

Interpretation:- To interpret the response of questions, the figures shows that most of the
customers find the problem in availability of funds i.e. 50% and very less number of customers
found problem in paying cash in go is 25%,customers get housing loan for tax benefit is 25%.
This was expected response because a large number of people find a problem in availability of
funds which works an obstacle in owing a dream home. In todays life people hardly earn both
means and ends of life and they dont have much of money to buy home or a land to construct
house because of cost of property. On the basis of this study, it is concluded that most of people
lack of money in fulfilling their dreams and few of them are reluctant to pay cash in one go and
wanted to pay their home loan slowly in installments.
Factors Considered By Respondents while availing home loan
(5- for Most Important, 1- for Least Important)

Sr.

Particulars

Total

Weighted

No.
1

Average Score
Service

170
75

40

Interest
rate

100

Trust

150

40

Pay back

65

48

10

15

20

220
60

45
30
33

10

2.8

20
3.6

10

235

4.0

24

12

182

3.0

124

2.0

20

26

period
5
Location

60

4.5
4
3.5
3
2.5
2
1.5
1
0.5
0
Service

Interest rate

Trust

Pay back period

Location

Interpretation:- From the above graph, it can be seen that 4.0 respondents consider trust
while availing home loan and 2.0 respondents consider location while availing home loan.

Sources of information regarding Home Loan

Sr No

Particulars

Respondents

Percentage

of

Respondents

Electronic Media

15

25%

Print Media

15

25%

Friends/Relatives

20

33%

Agents

10

17%

Total

60

100

Electronic Media
Print Media
Friends/Relatives
Agents

Interpretation: - From the above graph it is clear that, 33% of the respondents gather
information regarding home loan from friends/relatives, 25% of the respondents gather
information from print media, 25% of the respondents gather information from electronic media,
and 17% of the respondents gather information from agents.

Time Taken For Sanctioning Of Home Loan

Sr No

Particulars

No. of Respondents

Percentage

of

respondents
1

35

58%

15 days
2

1 month

11

13%

More than 1 month

14

17%

Total

60

100

Sales

15 days
1 month
More than 1 month

Interpretation: -From the above graph it is revealed that , 58% of the respondents said that
15 days was taken by the bank for sanctioning of home loan, 17% said that more than 1 month
was taken, 13% said that 1 month was taken,12% of the respondents said that 1 week was taken.

Respondents Repayment Period

Sr No

Particulars

No. of Respondents

Percentage Of
Respondents

Less than 5 years

12%

6-10years

10

17%

18

30%

3
11-15years
4

15-20 years

25

42%

TOTAL

60

100

Less than 5 years

6-10 years
11-15 years
15-20 years

Interpretation: -From the above graph it is clear that, 42% of the respondents have availed
home loan for 15-20 years, 30% have availed for 11-15 years, 17% have availed for 6-10 years,
12% have availed for less than 5 years.

Any problem in getting loan?

Options

Frequency

Percentage

Yes

45

75%

No

15

25%

Total

60

100%

Yes
No

Interpretation:From the table and graph above, it can be seen that:

75% of respondents face problems in getting home loan.

25% of respondents dont face such problems.

It is seen that the problems faced mostly because of lack of knowledge and noncooperation.

If yes, then,:-

Problems faced while getting Home loan:Problems

Frequency

Percentage

Lack of Knowledge

30

67%

Procedural delays

15

33%

Total

45

100%

Lack of knowledge
Procedural delays
Others

Interpretation:From the above table and graph, it can be seen that:

67% of respondents face problem in getting home loan because of lack of knowledge.

33% of respondents face problem because of procedural delays

Rate your preference on the following factors, with regards to your bank

Factors

Highly

Satisfied

Neutral

Dissatisfied

Highly

Summated Avg.

Satisfied
Range of

Dissatisfied

Score

Score

150

40

30

10

235

4.0

10

60

20

26

124

2.0

Trust

100

60

45

10

220

3.6

Interest Rate

75

40

15

20

20

170

2.8

schemes
Services
provided by the
bank

4.5
4
3.5
3
2.5
2
1.5
1
0.5
0

Interpretation:- From the above graph,it can be seen that 4.0

respondents prefer range of schemes,3.6 prefer trust and 2.0 respondents
prefer services provided by bank.

Would you like to shift from the loan services of present bank?
Options
Yes
No
Total

No. of respondents
10
50
60

Percentage
17%
83%
100%

Yes
No

Interpretation:From the above table, it can be seen that:

17% respondents wants to shift the loan services of present bank.

83% respondents are satisfied.

Would you like to recommend the name of your bank to other persons?
Options
Yes
No
Total

No. of respondents
50
10
60

Percentage
83%
17%
100%

Yes
No
4th Qtr

Interpretation:From the above table, it can be seen that:

83% respondents wants to recommend the name of bank to other persons.

17% respondents dont want to recommend the name of bank to other

Conclusion and Recommendation

FINDINGS & SUGGESTIONS

Among the various loans offered the researcher found that most of the customer availed home
loan whereas the takers for Mortgages and Housing loan are relatively less i.e. 44 percentages
have availed home loan. 31 percentages are auto loan and 16 percentages are of consumer
durable loan respectively. 4 percentages are of personal loan and 2 percentages are of mortgages

respectively. Hence it is recommended for the company to aggressively advertise these loan
facilities in both newspapers and television channels so that many people may be aware of the
same.

From the market research study it has been observed that 90% of the respondents are

aware of home loan.

62% of the respondents are aware of home loan through agent.
It was founded that 63% of the respondents are rate the service of home loan as very
good.

90% of the Existing Customers are Happy with the Benefits of home loan.

SUGGESTIONS

The home loan company should concentrate heavily on attractive advertisements and
various Promotional Strategies like, giving Pamphlets, put the hoardings and banners at

important locations
People should be educated by giving seminar in Business Conferences, installing stalls in
Business Exhibitions. And Company should conduct seminars in Educational Institutions

to provide information about company and its products.

Company has to create a sense of security among the customers because most of the
people fear about security.

CONCLUSION

The results and findings of this research study exemplifies the fact that an in- depth market
research has been conducted and all research work has been conducted and all the objectives set
for the research work has been fully accomplished and the analysis is also performed to the
maximum extent possible. An in-depth study has been made on the aspect that influences the
banks to be the best private financier. Customer satisfaction is the core element in the business.
For customer satisfaction the services have to be an edge over the other banks, which banks have

achieved. Banks is aptly targeted potential customers among the various levels of people in
India. The banks overall performance and services seems to be highly satisfied.
From the analysis it is
found that some customers have faced some procedural problem, for which the researcher has
given some suggestions and recommendations. Banks has got goodwill and reputation among
the public and this can be used for promoting it services. If new promotional activity and
services introduced, it will help very much the organization to increase the business.

REFERENCES

Chaudhary, R. and Janjhua, Y.(2011), Customer Perceptions and Satisfaction Towards Home
Loans, International Journal of Research in Commerce & management, 2(9) , 124-129.
Kothari, C.R.(1995), Research Methodology, New Age Publishers, New Delhi.
Kotler, P.(2004), Marketing Management, New Delhi, Prentice-Hall of India Pvt .Ltd.
Mylonakis, J. (2007), A Research Study ofCustomer Preferences in the Home Loans Market
The Mortgage Experience of Greek Bank Customers ,International Research
Journal of Finance and Economics, 10, 153-166.
Vanaja, V. and Sindhuja, J.(2013), A Study on Customer Perception towards HDFC Limited,
International Journal of Management Sciences and Business Research , 2(4), 69-81.

Websites referred

www.citifinancial.co.in
www.sbp.co.in

Annexure

QUESTIONNAIRE
Dear Respondents,
I, xxxxx, student of MBA 3rd Semester of xxxxxxxxxxx, Amritsar, am
conducting a survey on Customers Perception towards Home Loan towards SBP Ltd.
Please co-operate to fill this questionnaire. It is assured that this information will be kept
confidential.

A..Demographic Profile:Name: ______________________________

Age:
a26-35

b36-49

c)50-60

What is your education qualification?

(a.)Under graduate [ ]

Occupation:

(b) Graduate [

(c) Post graduate [

(a) Professional [ ] (b) Self-employed [ ] (c) Salaried [

] (d) Others [ ]

Which income group do you belong? (Per annum)

(a) Below 1 lakh [ ]
(b) 5-10 lakhs [ ]

(b) 1-5 lakhs [ ]

(d) 10 lakhs and above [

B..Content Information
1.)For what purpose, you have taken home loan?
(a) Home Construction [
(c) Land purchase [

(b) For renovation [

(d) Home purchase [

]
]

2.) What is reason for getting it financed?

(a) Non availability of funds [

(b) Reluctance to pay cash in go [

(c) Tax benefit [ ]

3.) Rate the following factors considered while availing home loan from specified bank
(5- for Most Important, 1- for Least Important)?
(a) Interest rates [
(b) Service [
(c) Trust [
(d) Location [

]
]
]

4.) From where have you got information regarding home loan Schemes?
(a) Print Media [

(b) Electronic Media [

(c) Friends& Relative [

(d) Agents [

5.) How much time was taken by your bank for sanctioning of home loan?
(a) 1 week [

(b) 15 days [

(c) 1 month [

(d) More than 1 month [

6) What is your repayment period?

(a) Less than 5 years [
(b) 6-10years [
(c) 11-15years [
(d) 15-20 years [

]
]
]

7.) Do you face any problem in getting loan?

(a) Yes [

(b) No [

8.) If yes, then which problem?

(a) Lack of knowledge [

(b) Procedural delays and non cooperation [

(c) Any other (please specify) _______________________________

9.) Rate your preference on the following factors, with regards to your bank

Factors

Highly
Satisfied

Satisfied

Neutral

Dissatisfied

Highly
Dissatisfied

Range of schemes
Services provided
by the bank
Processing time
Interest Rate
Pay Back Period
10) If given an option, would you like to shift from the loan services of present bank?
(a)Yes [

(b) No [

11) Would you like to recommend the name of your bank to other persons?
(a)Yes [

(b) No [

12) Any Suggestions you want to make to your bank regarding Home Loans?

THANKS FOR YOUR COOPERATION