Tag: housing loan details

State Bank of Bikaner and Jaipur offers discount on online home, auto loans

20 Dec 2012, ET Bureau.

MUMBAI: Now, get discount on online purchase of home loan and auto loan. State Bank of Bikaner and Jaipur(SBBJ) is offering a 10 basis points discount on home loan and 25 basis points discount on online purchase of loan. The country’s largest bank State Bank of India is likely to follow its subsidiary.

SBBJ has seen increase in applications with the online offer. For auto loans above 10 lakh, the bank is offering 25 basis points discount. The bank is offering 10 basis points discount on home loans of any amount.

“We have seen good response after we rolled out this scheme,” said SBBJ managing director Shiv Kumar. “Large public sector banks are studying our model and would follow us soon.”

The bank has waived off processing fee and pre-payment penalty. It is sanctioning 200 auto loans and 70 home loans through online every month. Home loans have grown by 12.1% year-on-year in November, compared with 16.5% in the same month a year ago.

State-run banks are hit by high non-performing loans in the corporate sector. The focus has shifted to retail portfolio. To push retail loans, public sector banks are offering auto loan free with home loan.

Home buyers more keen on resale market; project delays trigger boom

10 Jul 2012, ET Bureau.

NEW DELHI: Home sales in new projects across the country may have dipped in the last few quarters, but this hasn’t affected the resale market where business is actually booming.

Even banks and housing finance companies are seeing a shift as homebuyers are not willing to take a chance with delayed projects. Nearly 70% of those taking loans are investing in ready or nearly-ready homes, which is in sharp contrast to last year’s when 70% customers took loans to buy new homes and only 30% entered the resale market, says Destimoney, a company which provides home loans.

“Enormous delays in execution, liquidity crisis, high cost of borrowings and growing rentals are reasons why home buyers now want ready properties,” says Sameer Jasuja, chief executive officer of property research and analytics firm PropEquity.

Home buyers, wary of delays, prefer to enter projects at a much later stage and are even willing to pay a premium rather than live with uncertainty. PropEquity’s research shows that nearly half of the 930,000 under-construction residential units in India, scheduled for delivery between 2011 and 2013, are likely to be delayed by up to 18 months.

“Buyers are scared of an indefinite wait and are trying to mitigate risk. It is a good signal for the industry and will put pressure on developers to finish projects on time,” says RV Verma, chairman and managing director of the National Housing Bank. “Developers should look at it as a caution signal.”

“Prudence has come in as people are being careful today,” says Renu Sud Karnad, managing director of India’s biggest mortgage lender HDFC Ltd, which is expecting a 18-20% growth in home loan take-up in the April-June 2012 quarter.

In the January-March 2012 quarter, new home sales dropped by 57% in the National Capital Region, 58% in the Mumbai Metropolitan Region, and 18% in Bangalore. According to real estate brokers and consultants, a good amount of this business has moved to the secondary market.

“People are willing to pay a premium for ready properties,” says Brijesh Parnami, chief executive officer, distribution, at Destimoney. In the past one year, along with property prices, rentals too have increased considerably. In Mumbai, rentals are up between 10%-20% depending on the location, while in Noida, rents have zoomed by 30% and above during the period.

“This is putting pressure on a number of prospective buyers who are jumping at the opportunity of buying a house they can move into so that they can save on rent,” says Sumit Joshi, director of Noida-based real estate brokerage firm Real Credit Consultancy. In Pune, most end users today want to buy ready property.

National capital suffers from accomodation crunch: Government

7 May 2012, PTI.

NEW DELHI: Finding a proper accomodation seems to be a problem in Delhi as a new government data shows that three or more couples sleep under one roof in around 1.37 lakh houses while more than nine people live together in a single house in over two lakh dwellings in the city.

According to ‘Houselisting and Housing Census 2011′ for Delhi released today, six to eight members live under one roof in 25.6 per cent of 33,40,538 households in the city while six per cent of the houses (around two lakh) have more than nine people living in a single dwelling.

In 3.7 per cent households, only a single person lives on an average while 7.6 per cent houses have two persons and 12.8 have three persons. Twenty-four per cent of the households have four members while 20.4 per cent have five members.

The figures suggested that 32.2 per cent of the households have one room each while 29.6 per cent had two rooms and 20 per cent have three rooms.

The statistics said 3.5 per cent (around 1.16 lakh) of 33.40 lakh houses have six or more rooms while three per cent of the households have five rooms.

Delhi also appears to be well-placed in providing electricity connections as the statistics suggested that 99.1 per cent of the houses in the capital have power supply while only 0.1 per cent does not have any source of lighting in their houses. 0.7 per cent households depend on kerosene for lighting purposes.

Delhi’s households also have highest number of latrines in houses. Eighty-seven per cent of the houses in the capital have bathrooms while 8.9 per cent or around 2.97 lakh houses do not have such a facility.

Bifurcated Home Loan Process

Mr. Rahul a corporate employee has forgot to check the Home Loan sanction letter of the bank before signing it, as a result of which he is paying 0.5% of additional interest on his home loan account. This is a very common mistake that many customers do while taking a home loan. Customers blindly trust the home loan service provider and sign the documents with out reading it which is not suggestible to as a Home Loan is a Long Term (Life Time) contract with the bank.

To educate all the customers who are going for Home Loan we are giving some key points where the customer need to be careful to have this Long term contract a stress free one.

Application and Documents: The most important and key stages of the home loans process where the customer signs and provides the service provider with the income and legal documents of the property for approval.

All the customers are suggested to give only the appropriate information regarding your Employment, assets and Insurance. It is not suggestible to give the information which misleads the bank as the bank verifies the information given by you in the application. Any discrepancy in the information provided will lead in rejection of your application. Submit all the documents and receipts of credit card settlements if any, this will make your application clear and increases the chances of approval.

Read the Terms and Conditions of the bank state overleaf before signing it as banks do mention about the details of refundable and Non- refundable processing fees and other details.

Process: The second stage is the Home Loan Process where banks will verify the income details, legal and technical details of the property.

a. Personal Verification: Banks will verify the details mentioned in the application form by the customer and send their representatives to residence and offices to verify the details and employment of the customer personally.

If in any case the customers in not available for verification then banks do send mails to the HR of the company to conform the employment of the customer before giving any approval on the income basis.

b. Eligibility Process: After the completion of personal verification to the residence and office banks will process the eligibility by taking the customer(s) income into consideration. Some banks consider Net Earnings and some gross earning to calculate the eligibility. It is always suggested to go for a less amount of loan compare to the property cost to be flexible in paying the EMI’s.

Banks can ask for supporting documents of additional income if has like rental income for which customers need to submit the rental deeds and the banks statements reflecting rents being credited.

c. Legal Verification: The second stage of the processing where banks verify the legality of the property with the panel advocates with the documents given by the customer. Banks reserve the right to ask for additional documents if needed to certify the legality of the property before giving legal approval over that property.

Banks certification of the legality of the property will not certify the property completely. If any legal discrepancies arises in future over the property purchased by the customer with the bank loan, the customer have to fight against the legal hassles on his own and continues paying the EMI with out fail.

d. Technical Evaluation: The property for which home loan was applied will be evaluated by the panel valuators in terms of the Constructed Areas, Plot areas, Market value, Horizontal and vertical deviations etc.,

Banks reserve the right to ask for additional documents if needed to clear the valuation for the property.

Sanction: After successful completion of the Personal verifications, Eligibility process, Legal and technical verifications banks will provide sanction letter of the loan applied by the customer. The sanction letter states the applicable Rate of Interest (ROI), Tenure, Processing and prepayment charges etc., revision of interest rates of the loan applied.

If any additional conditions are there, those will be mentioned under sanction conditions column. All the customers are suggested to go through the sanction letter thoroughly in regard of the ROI, Tenure and the fees committed by the service provider, if any discrepancy is noticed please demand the banker to change those before signing it.

Funding and Disbursement: Last but not the least is the Disbursement. Customer need to sign Home Loan Disbursement Agreement in which banks will state all its terms and conditions of the loan like repayment, covenants and customers responsibilities etc.,

All the customers are suggested to read the agreement once completely before signing it.

Funding of the loan will vary from product to product. Banks do provide maximum funding over any property but it should be limited to lesser amount for EMI payment, part payment and pre payment flexibility.

Banks will fund on the basis of Technical value, agreement value or the sanctioned amount whichever is less.

Banks charge Pre – EMI (Interest component of the amount disbursed) if the duration between the loan disbursement and the EMI date is below 30 days or in the case where the loan is completely not disbursed.

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