home loan market: consumer analysis
TRANSCRIPT
1
“HOME LOAN MARKET: CONSUMER
ANALYSIS”
Submitted by :(CR-3)
Divya Khunt (30301280)
Divyesh Lakhani (30301322)
Submitted to:
Unitedworld School of Business
Karnavati knowledge village, A/907, Uvarsad, Gandhinagar Highway,
Ahmedabad 382422
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DICLARATION
We hereby declare that this project submitted to UnitedWorld School of
Business, Ahmedabad. Under the guidance of Dr.Kishor Bhanushli.In the
partial fulfillment of the requirement for the degree of PGDM.This is a result
of our team work carried out during January to march 2014.
This report is entirely an outcome of our team effort and has not been
previously submitted to any other institute or university for any other
examination and for other purpose by any other person.
DATE:
PLACE: Ahmadabad
3
ACKNOWLEDGMENT
"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 toexpress the feeling of gratitude towards
people who helpful us in successfully completing of our report. We would
like to express our deep gratitude toUNITEDWORLD SCHOOL OF
BUSINESS.
We feel great pleasure to express our feeling of guidance to our academic
guide Dr. Kishor Bhanushalifor giving the valuable guidance and
suggestion for successful completion of this dissertation. He is always with
us for his competent guidance and valuable suggestion throughout the
pursuance of this research project. And also thanks to all team member
without them support this project can not complete.
In this project the great emphasis is given to home loan. We wish and
express our heart full gratitude to the project guide manager of HDFC bank.
His guidance and suggestion throughout the project, without which would
not have been able to complete this project.
Last but not least we would also like to place of appreciation to allthe
respondents whose responses were of utmost importance for the
project. Thankful to all the respondents whose cooperation& support has
helped us a lot in collecting necessary information.
This project is very challenging opportunity for us to update ourselves. So, I
would like to give thanks to everyone who help us directly and indirectly in
preparing this project.
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EXECUTIVE SUMMERY
Home loan is dream of person that show the quantity of effort, sacrifices
luxuries and above all gathering funds little to afford one‟s dream. Home is
one of the things that covered everyone want to own. Home is shelter to
person where he rests and feels comfortable. The housing sector plays an
important role in economic development of the country.
Our project title is “Marketing of home loan”. We selected this topic because
Indian housing finance industry has grown by leaps and bound in few years.
A total home loan disbursement by bank hasrisen which witness phenomenal
growth from last 5 years. There are greater number of borrows home loan.
Our objective this study is to know the Customers perceptions about home
loans.
The introduction part includes all the information about home loan and the
history of the home loan. And process of home loan and disbursement of
home loan. In the research methodology we have taken both primary data as
well secondary data, in the primary data we had make a questionnaire to
check the satisfaction level of customer about home loan. In the secondary
data we had studied the annual report of RBI, commercial bank and HDFC
bank.
At the end it illustrates the suggestion and findings based on the analysis
done in the previous section finally deal with the conclusion part.
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LIST OF TABLE
SR. NO TABLE NAME P.NO.
1 Selection Of Bank 12
2 Criteria Considering While Taking Loan 13
3 Interest Rate 14
4 Satisfaction Level 15
5 Loan Amount 16
6 Facing Problem While Taking Loan 17
7 Age Of Respondent 18
8 Gender Of Respondent 19
9 Occupation Of Respondent 20
10 Income Of Respondent 21
11 Satisfaction level and gender 22
12 Gender and loan amount 23
13 Problem and occupation 24
14 Income level and Interest rate 25
15 Income level and loan amount 26
16 Satisfaction level and gender 27
18 Gender and loan amount 28
19 Occupation and problem 29
20 Income level and interest rate 30
21 Income level and loan amount 31
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LIST OF FIGURE
SR.NO Name of figure P.NO
1 Selection of bank 12
2 Interest Rate 14
3 Satisfaction Level 15
4 Loan Amount 16
5 Problems 17
6 Age 18
7 Gender 19
8 Occupation 20
9 Income 21
10 Satisfaction Level And Gender 22
11 Gender And Loan Amount 23
12 Problems And Occupation 24
13 Income Level And Interest Rate 25
14 Income Level And Loan Amount 26
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TABLE OF CONTENT
CHAPTER TITLE PAGE NO
TITLE PAGE I.
DECLARATION II.
ACKNOWLEDGEMENT III.
EXECUTIVE SUMMARY IV.
LIST OF TABLE V.
LIST OF FIGURE VI.
1 INTRODUCTION 1
1.1 Introductions of home loan
1.2 Advantages of home loan
1.3 Disadvantages of home loan
1.4 Disbursement of home loan
2 LITERATURE REVIEW 6
3 RESEARCH METHODOLOGY 9
3.1 Research statement
3.2 Research objective
3.3 Research design
3.4 Sources of data
3.5 Sample design
3.6 Tools used for data analysis 11
4 DATA ANALYSIS 12
5.1 Univariat analysis
5.2 Bi-variat analysis
5.3 Hypothesis testing
5 FINDINGS 32
6 CONCLUSION 33
7 REFERENCE 34
8 ANNEXURE 35
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CHEPTER 1
INTRODUCTION
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1.1. INTRODUCTION TO HOME LOANS
Home is a dream of a person that shows the quantity of efforts, sacrifices luxuries and
above all gathering funds little by little to afford one‟s dream. Home is one o f the
things that eve ryone one wants to own. Home is a she lte r to pe rson where he
rests and fee ls comfortab le. Many banks provid ing home loans whe ther
commerc ia l banks or financ ia l inst itut ion to the peop le want to have a home.
HDFC- (Hous ing Deve lopment and F inance Corpora t ion) home loan, Ind ia
have been serving the peop le for around three decades and provid ing var ious
hous ing loan accord ing to the ir va r ied need a t at trac t ive & reasonab le interest
rate. Owing to the ir ne twork o f financ ing, HDFC hous ing loans provides
service at your door step and he lps you find a home as pe r your requirements.
Many banks are providing home loans at cheapest rate to attract consumers towards
them.
The more customer fr iend ly at t itude o f these banks, currently o ffer to
consumers cheapest loan over homes. In view o f acute hous ing sho rtage in
the country, and keep ing in mind the soc ia l, economic ro le o f commerc ia l
bank in the present t ime, t he RB I ad v ised ba nk s to encourage the flow of
credit for housing finance. With the RBI reduc ing bank ra te, the home loan
market rate s nose-d iving by 50 bas is po ints.
The HDFC Bank and Standard cha rte red bank has become the firs t p layer
inthis sec tor to announce a hous ing loan for a 20 yea rs per iod. No doubt
it wil l enhance theend cost peop le to p lan the ir house over longer dura t ion
now; it has been made easy for a person to buy tha t dream house which the
dreamt o f long ago.
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1.2. ADVANTAGES OF HOME LOANS:-
The various benefits of home loans arising to the customers are:-
Attractive interest rate:
The various banks offer attractive interest rates to boost and help their customers. Many
banks provide loans on fixed or floa t ing ra tes to fac il ita te consumers as per
the ir needs.
Help in owning a home:
The home availed by a person with the help of banks because they provide technical and financial
assistance to customer for owing their dream home.
No requirement of guarantor:
The commercial banks now a day liberalize their laws regarding home loans. Some of
banks don‟t 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.
Door-step services:
These doors 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 cha rte red bank provide door to s tep se rvices to
cus tomers to bo rrow loan.
Loan period:
There are many banks which provide maximum loan tenures up to 15-20 years based on
the loan amount and the credibility of customers. This relieves the customers to repay
loan amount till a long period
For accidental death insurance:-
Some banks provide free accidental death insurance with housing loan which is
also beneficial for the customers. These benefits o r advantages o f home loans are
respons ib le for mak ing than so popular among customer that a person who doesn‟t
have their home and want to buy, they do it with home loan. Home loans help such
persons in making their dream home.
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1.3. DISADVANTAGES OF HOME LOANS:-
The main disadvantages of home loans are high lightened as below:
Delays in processing:-
Many t imes, the re a re huge de lays in process ing o f provid ing home loans
because var ious formula t ions to be fulf il led in this process. Due to these
de lays cus tomers fee l mentally as well as financially weak.
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.
High cost:
The pub lic secto r banks cha rge high process ing cost for home loan‟s
sanc t ioning. They are forced to pay serious charges at various stages to fulfill the
requirements. Some consumers are no t ab le to pay such charges so such peop le
could not ava il the benefits o f home loan schemes.
Problems in disbursement:
There are many prob lems in d isbursement o f home loan amount. There is
some de lay 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 insta llments to repay loan amount.
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1.3. DISBURSEMENT OF HOME LOANS:-
The every bank has its own procedure to disburse the loan amount among customer. After choosing your
right home, the next step is disbursements 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 230A clearance of seller and 371 clearances from the appropriate authority of income tax is
also needed.
1.3.1. 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 can apply for a loan
before even selecting the property. Once them maximum amount onto put into property has been
decided, the housing finance intuition or banks will let the customer know that how much he is eligible for
and this helps to plan out budget.
1.3.2. Conditions regarding co-applicants: -
All Housing Finance Institutions lay down conditions on who can be co-applicants. All
co-owners to the property. Need to be co-app licants to the loan necessar ily.
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
information are throws light on acceptable relationship of a co-applicant for clubbing of
income. Income Clubbing of Co-applicants:
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.
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1.3.3. General Terms and Conditions: -
T he fo l lo w ing a re t he te r ms a nd co nd it io ns applicable to the basic home loan
product only. These are likely to change on the basis of the var iat ions o f the home
loan product. Typ ica lly, in genera l home loans, the fo llowing conditions are
applicable.
The loan to value ratio (LTV) cannot exceed a particular percentage. This differs
from product to product and from one hosing finance institution bank to 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
monthly-gross 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.
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CHAPTER 2
LITERATURE REVIEW
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LITERATURE REVIEW
Rao K. N. conducts a research on “Retail Banking – Emerging Issue in Home Loan”
in the year 2005. In this research the researcher revealed that during 2002-03 housing
loans by banks grew at a hefty growth rate of more than 100%. The factors that
contributed to this aggressive growth in the portfolio of housing loans of banks and HFC
are: Tax intensives on repayment of principal and interest, rising income level of middle
class, falling interest rate, stable real estate prices, easy availability of housing loans, low
returns on the investment opportunities available in the market. They also concluded that
although there is strong growth in housing loans by financial situations in India, we are
still behind the developed countries in terms of housing loans to GDP ratio.
BrarJasmindeep conducts a research on a “Performance of Housing Finance
Companies” in the year 2005.The main objectives of this research was to study the
operational performance, and the financial performance of the selected institutions. The study
covers three institutions viz. HDFC, LIC & PNB. The study is based on secondary data that
have been collected from the annual reports and web sites of the institutions selected under
study. It covers the period from 1990-91 to 2002-03. The performance of the selected
institutions has been studied by using percentages, compound growths rates and various
ratios.
LallVinay conducts a research on “Housing credit situation in eighties “in the year 1984.
The main objective was attention upon „formal factor‟ (Permanent Construction) which served
mainly to the HIG and MIG, the loan meets only 47% of the price of the house, forcing the
borrowers to make very large down payments. Also the price of a typical house was above 3
times the annual families‟ income of the borrowers. In spite of, the entire system of housing
allocation and credit the supply of affordable funds was much smaller than demand. Thus,
large growth in urban population and the historically low priority given to housing, supply
falls very short of demand and need.
Vandell, Kerry D Analysis in the Year 2008 And He Analysis the Sharpe rise and then suddenly drop down
home price from the period 1998-2008. Changes in prices are for the reasons as such economic fundamentals,
the problem was not subprimelending, but the dramatic reduction, then increases in interest rates during the
early mid-2000,the hosing – boom was concentrated in those market with significant supply side restriction,
which tend to be more price- volatile; and the problem was not excess supply of credit in aggregate, or increase
in subprime percentage but rather in the increased or reduced presence of certain another Mortgage products.
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M.Mahadeva conducts a research article on “Housing Problem and Incompatibility
Experience from a South Indian State” in the year 2004.In this article, the author has
analyzed the nature and distribution of the housing problem in Karnataka and examined how the
state has addressed this issue. In particular, it considers the strategies adopted during the 90s and
identifies a number of failures including the task force on housing. Some of the major
weaknesses, pertaining to 51 incidences by type and by rural-urban areas, on approaches, on
financial requirements and issue of development and redevelopment are examined to propose
alternative policy strategies to effectively address the housing problem in the state. From the
analysis it is found that Karnataka is not an exception to the general rule that housing strategies,
which were evolved over decades, have not taken the direction expected.
Mr.Krishnamachari conducts a research on “problem of the national housing policy” in
year 1980. The research stated that shelter is a basic human need and as an intrinsic part of
human settlement, is closely linked with the process of overall socioeconomic development.
Though a house is essentially a place of dwelling, it also fulfills many important social needs of
the household. Besides providing shelter, it creates employment, generates voluntary salving and
creates a conducive condition needed for achieving crucial goals”
Berstain David (2009) examined in his study taken from 2001 to 2008 that in this period there is
increased use of home loans as compared to private mortgage insurance (PMI).he have divided
his study into four sections. Section 1 describes why people are going more for home loans than
PMI. the main reason for this that now home loans market provide Piggybank loans for those
people who don‟t have 20% of down payment. Section2 tells the factors responsible for the
growth of home loans and the risks on shifting toward home equity market without any PMI
coverage. PMI can protect lenders from most losses up to 80% of LTV and the absence of PMI
will result in considerable losses in an environment. Section 3 tells the measures in changes of
type of loans. For this he have taken the data from the 2001 and 2007 AHS a joint project by
HUD and Census The results of this analysis presented in Table One reveal a sharp increase in
the Prevalence of owner-occupied properties with multiple mortgages among properties with
firstmortgages. Section 4 describe the Financial status of singlelien and multiple- lienhouseholds
and for this he have taken the survey of consumer finance and show that financial position is
more weaker in multiple loans than the single loans.
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La cour Micheal (2006) examined the home purchase mortgage product preferences of LMI
households. Objectives of his study to analysis the factors that determined factors their choice
of mortgage product is different income groups have some specified need to meet particular
product. The role pricing and product substitution play in this segment of the market and do
results vary when loans are originated through mortgage brokers? For this they have use the
regression analysis and the results are high interest risk reduce loan value. Self-employed
borrower chooses reduce documented loans than salaried workers Use of this product type
seems to be more prevalent among borrowers with substantial funds for down payment and
better credit scores. In case of pricing Multi families requires price premium and larger loans
carry lower rate. And the role of time, particularly, the time required for the loan to proceed
From application to closing. It is find that government lending taking the longest time and
Nonprime loans the shortest time.Multi family properties take longer time in closing. And
during peak season take longer time to close. And for last objective it is find that broker
originated loans close faster. The effect of mortgage brokers on pricing and other market
outcomes is fertile ground for additional research
Haavio, Kauppi (2000) stated that countries where a large proportion of the population lives
in owner – occupied housing are experiencing higher unemployment rates. Than countries
where the majority of people live in private rental housing, which might suggest that rental
housing enhances labor mobility. In this paper, they develop a simple inter temporal two
region model that allow us to compare owner occupied housing markets to rental markets and
to analyze how these alternative arrangements allocate people in space and time. Announced
that it will offer loans for Rs. 2-10 lakh at 12.5 percent the lowest rate offered by any housing
finance provider, big brother SBI has taken the rate war in the home loans category to new
heights. This is because, apart from the low rate, the interest on these loans is calculated on
principal, which is reduced every month unlike other housing finance companies which
calculate interest on annually reducing basis
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CHAPTER 3
RESEARCH METHODOLOGY
20
RESEARCH METHODOLOGY
Research methodo logy is a way to systematica lly show the research prob lem. it
may be understood as a sc ience o f studying how research is done sc ientifica lly. It
is necessary for the researcher to know not only re search methods but a lso the
methodo logy. This Section includes the methodology which includes. The research design,
objectives of study, scope of study along with research methodology.
3.1. NEED FOR RESEARCH:
Need of this research is help to know the ideas of customers about home loan products
and services. And how to do marketing of home loan product to the customer in the
market. And also learn about various aspect of HDFC home loan ltd. It also provide
knowledge about understating bank statement, income statement, KYC terms, loan
eligibility, borrower‟s contribution, EMI, rate of interest, introduction to property market,
ownership & transfer of title, property costs etc.
3.2. PROBLEM STATEMENT:
This research is conducted to study on“Marketing of Home loans”
3.3 OBJECTIVES OF RESEARCH:
3.3.1. Primary objective:
The main objective of this study is to know the Customers perceptions about home loans.
To know the ideas of customers about home loan products and services.
To make comparative study of Disbursement of home loans by
Commercial banks.
To analyze the history of home loan.
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3.3.2. Secondary objectives:
To know the current scenario of the home loan products of different bank in the market.
To get knowledge about “ Indian hosing finance such as operation
perform by banks, different type of bank product, service”
3.4. RESEARCH DESIGN:
3.4.1 Type of research: There are mainly three types of research design:
Exploratory research design
Descriptive research design
Causal research design
This project is based on exploratory study. It was an exploratory study when the know the
scenario of marketing of home loan in market. And also study was made for comparison of disbursement of home loan by commercial banks.
3.5. SOURCE OF DATA:
There are mainly two sources of data to be collected:
Primary data
Secondary data
To fulfill the information need of the study. The data is collected from primary as well as secondary sources.
Primary data are collect from the survey method and I conduct the 50 sample of survey in the project to know the marketing of home loan from the customer.
Secondary data are collect from internal sources. The secondary data was
collected on the basis of organization file, official records, newspapers, magazines, management book and website of the company.
3.6. SAMPLE DESIGN:
3.6.1. Sampling Design: Here, non-probability convenience sampling method has been used.
3.6.2. Sample size: For the questionnaire wehave taken the sample size 50 of respondent who have
taken home loan.
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3.7. TOOLS USED FOR DATA COLLECTION:
The study based on secondary data. The relevant sources of Secondary Data are
use like:
www.HDFCbank .com
www.shodhganga.com
www.canstar.com
With the help of these sources we find the rate of home loan of different banks.
3.7.1. Data collection period: Datacollection period for this project is 15 days.
3.8. TOOLS USED FOR DATA ANALYSIS:
Data has been presented with the help of bar graph, pie charts, and line graphs etc. and, in SPSS frequencies and used pie charts and bar charts and cross tabulation. And more important is hypothesis testing.
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UNI VARIATE ANALYSIS
SELECTION OF BANK
Table 1
Figure 1
From the above graph it interpret that 32% people taken loan from the sbi, while 20%
people taken loan from the HDFC bank. And 2% people took loan from UTI, IDBI,
TATA capital, PNB home finance. And 6 % people have taken loan from Kotak. So, we
can say that more than 50% people taken loan from the SBI and HDFC so, both the bank
covered more than half the market of home finance.
ICICI8%
HDFC20%
UTI2%
Tata capital2%
IDBI2%
Bank of baroda
12%
SBI32%
Axis bank4%
Kotak6%
PNB home finance
2% other10%
Selection of Bank
Bank Respondent Percenage
ICICI 4 8
HDFC 10 20 UTI 1 2 Tata capital 1 2 IDBI 1 2 Bank of baroda 6 12 SBI 16 32 Axis bank 2 4 Kotak 3 6 PNB home finance 1 2 Other 5 10 Total 50 100
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CRITERIA CONSIDER WHILE TAKING LOAN
Table 1
From the above table It Interpret highest mean is 6.6. Of loan tenure and second highest
is 5.1.so, we can say that highest number of people gives more important to loan tenure
and followed by margin amount and then loan eligibility.
List Of Criteria Mean
Faster processing 3.2000 Interest rate 2.9600
Brand Image of Bank 4.0800 Margin Amount 5.1000 Pay Back Period 4.4800 Schemes 4.9600 Loan Tenure 6.6000
Loan eligibility 4.7000 Other 8.8800
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INTEREST RATE
Table 2
Figure 2
From the above graph it interpret two types of rate are fixed and floating rate from which
58 % people pay fixed rate for their home loan while 38% people pay floating rate for the
home loan and remaining are pay other interest rate. So we can say that more number of
people preferred fixed rate for their home loan.
Fixed rate58%
Floating rate38%
other4%
Intrest Rate
Type of Interest Rate Respondent Percentage
Fixed rate 29 58 Floating rate 19 38 Other 2 4
Total 50 100
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SATISFACTION LEVEL
Table 3
Figure 3
From the above graph interpret the satisfaction level of the services In this only 16%
people are highly satisfied with the home loan services. While 40% people are average
satisfactory. And, 38% people are satisfied with the services. And remain are dissatisfied
with the services. So, In the India people are not satisfied from the home finance market.
Highly Satisfactory
16%
Satisfactory38%
averagely satisfactory
40%
Dissatisfactory6%
Satisfaction Level
Criteria of Satisfaction Respondent Percentage
Level
Highly Satisfactory 8 16 Satisfactory 19 38 Averagely satisfactory 20 40 Dissatisfactory 3 6 Total 50 100
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LOAN AMOUNT
Table 4
Figure 4
From the above graph It Interpret about loan amount from its 48% people are taking 5 -10
lakh amount of home loan and 42% people are take 1-5 lakh loan amount.so, most of the
people take 5-10 lakh loan amounts from the bank.
less than 1 lakh6%
1-5 lakh42%5-10 lakh
48%
more than 10 lakh4%
Loan Amount
Loan amount Respondent Percentage
Less than 1 lakh 3 6 1-5 lakh 21 42
5-10 lakh 24 48 More than 10 lakh 2 4 Total 50 100
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PROBLEM FACING WHILE TAKING LOAN
Table 5
Figure 5
From the above graph It Interpret what are the problem facing by the respondent so, 58%
people facing problem of lack of knowledge i.e. awareness of the services and 26%
people face the problem of procedural delay means that the process of the loan passing is
very time consuming and complex. So, we can say that more number of people are not
aware about facility provided by the bank because of lack of knowledge.
lack of knowledge
58%procedural delay and non-
corporetion
26%
other16%
Problem Facing While Taking Loan
Problem Respondent Percentage
Lack of knowledge 29 58 Procedural delay and non-Corporetion 13 26 Other 8 16 Total 50 100
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AGE OF RESPONDENT
Table 6
Figure 6
From the above graph it interprets that age of respondent from them 38% people‟s age is
between 35-45. 28% people‟s age is between 25-35.and 26% people‟s age is 45-55 and
remaining age is above 55.so, we can say that more number people‟s age is between 35-
45.
25-3528%
35-4538%
45-5526%
above 558%
Age
Age No. of Respondent Percentage
25-35 14 28
35-45 19 38
45-55 13 26
above 55 4 8
Total 50 100
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GENDER OF RESPONDENT
Table 7
Figure 7
From the above graph it interprets that gender of the respondent from that 72% people are
male and 28% people are female. So we can say that highest number of people is male.
male72%
female28%
Gender
Gender Respondent Percentage
Male 36 72 Female 14 28 Total 50 100
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OCCUPATION OF THE RESPONDENT
Table 8
Figure 8
From the above graph it interpret that occupation of the respondent from
that 50%people are salaried i.e. they are doing job. 26% people are self-
employed and 16% are professional and remaining 8 % are in other
occupation. So, we can say that who are doing job and salaried those all
person preferred home loan.
professional16%
self-employed
26%salaried50%
other8%
Occupation
Occupation Respondent of occupation
Percentage
Professional 8 16 Self-employed 13 26 Salaried 25 50 Other 4 8
Total 50 100
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INCOME OF RESPONDENT
Table 9
Figure 9
From the above graph it interpret the income level of the respondent from
that 50% people’s income is between 2-4 lakh and 24% people’s income
is 4-6- lakh, 16% people’s income is more than 6 lakh and remaining
10% income is below 2 lakh. So we can say that person taken loan that
all people’s income is between 2-4 lakh and less number of people that
income is below 2 lakh.
below 2 lakh10%
2-4 lakh50%
4-6 lakh24%
6 lakh and above16%
Income
Income Respondent Percentage
Below 2 lakh 5 10 2-4 lakh 25 50 4-6 lakh 12 24
6 lakh and above 8 16 Total 50 100
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BI-VARIANT ANALYSIS
SATISFACTION LEVEL AND GENDER
Table 13
Figure 10
The above graph is interpreting it relationships between two variable gender and
satisfaction level. So, in average satisfactory level male are 17 and female are only 3 so
high level of difference in average satisfactory level between male and female. And in
dissatisfactory male are 2 and female are only 1 so very less difference in
dissatisfactory.so very less number of people are dissatisfied with the services.
0
2
4
6
8
10
12
14
16
18
Highly Satisfactory
Satisfactory averagely satisfactory
Dissatisfactory
male female
Highly
Satisfactory
Satisfactory Averagely
satisfactory
Dissatisfactory Total
Male 7 10 17 2 36 19.4% 27.8% 47.2% 5.6% 100.0%
Female 1 9 3 1 14 7.1% 64.3% 21.4% 7.1% 100.0%
Total 8 19 20 3 50
16.0% 38.0% 40.0% 6.0% 100.0%
34
GENDER AND LOAN AMOUNT
Table 12
Figure 11
Above graph is interpret that the relationship between loan amount and gender. 18
male and 6 female have took loan of Rs. 5-10 lakh. While 14 male and 7 female have
took loan of Rs. 1-5 lakh. And only 2 male has took loan of Rs. More than 10 lakah.so we
can say that more number of male take loan of rs.5-10 lakh.
0
2
4
6
8
10
12
14
16
18
less than 1 lakh 1-5 lakh 5-10 lakh more than 10 lakh
male female
LOAN
AMOUNT/GENDER
Male Female Total
Less than 1 lakh 2 1 3 66.7% 33.3% 100.0%
1-5 lakh 14 7 21 66.7% 33.3% 100.0%
5-10 lakh 18 6 24 75.0% 25.0% 100.0%
More than 10 lakh 2 0 2
100.0% 0.0% 100.0% TOTAL 36 14 50
72.0% 28.0% 100.0%
35
PROBLEM WHILE TAKING LOAN & OCCUPATION
Table 13
Figure 12
From the above graph interpret it relationship between occupation and facing problem while
taking loan. 16 salaried person facing problem of lack of knowledge. While 3 salaried person
facing problem procedural delay and non-cooperation. 9 self-employed people facing problem
of lack of knowledge and 4 self-employed people facing problem of procedural delay. So we can
say that salaried person face problem of lack of knowledge more than the professional person.
And only 4 self-employed people face the problem of procedural delay.
0
2
4
6
8
10
12
14
16
professional self-employed salaried other
lack of knowledge proceduraldelay and non-corporetion other
PROBLEMS Professional Self-
employed
Salaried Other TOTAL
Lack of knowledge 3 9 16 1 29
10.3% 31.0% 55.2% 3.4% 100.0%
Procedural delay and
non-corporation
4 4 3 2 13 30.8% 30.8% 23.1% 15.4% 100.0%
Other 1 0 6 1 8
12.5% 0.0% 75.0% 12.5% 100.0%
TOTAL 8 13 25 4 50 16.0% 26.0% 50.0% 8.0% 100.0%
36
INCOME LEVEL AND INTEREST RATE
Table 14
Below 2 lakh 2-4 lakh 4-6 lakh 6 lakh and
above
TOTAL
Fixed
rate
4 12 7 6 29
13.8% 41.4% 24.1% 20.7% 100.0% Floating
rate
1 13 4 1 19
5.3% 68.4% 21.1% 5.3% 100.0% Other 0 0 1 1 2
0.0% 0.0% 50.0% 50.0% 100.0%
TOTAL 5 25 12 8 50 10.0% 50.0% 24.0% 16.0% 100.0%
Figure 13
Above graph interpret it the relationship between income level and interest rate. 12 person
are pay fixed rate whose income is 2-4 lakh, while 13 people pay floating rate whose
income is 2-4 lakh.so there is little difference. Whose income above 6 lakh those people
preferred fixed rate.7 person pay fixed rate whose income is 4-6 lakh.
0
2
4
6
8
10
12
14
Below 2 lakh 2-4 lakh 4-6 lakh 6 lakh and above
Fixed rate Floating rate other
37
INCOME LEVEL AND LOAN AMOUNT
Table 15
Below 2 lakh 2-4
lakh
4-6 lakh 6 lakh
and
above
TOTAL
less than 1 lakh 1 1 1 0 3 33.3% 33.3% 33.3% 0.0% 100.0%
1-5 lakh 2 14 4 1 21 9.5% 66.7% 19.0% 4.8% 100.0%
5-10 lakh 2 9 7 6 24
8.3% 37.5% 29.2% 25.0% 100.0% more than 10 lakh 0 1 0 1 2
0.0% 50.0% 0.0% 50.0% 100.0% TOTAL 5 25 12 8 50
10.0% 50.0% 24.0% 16.0% 100.0%
Figure 14
Above graph interpret the relationship between loan amount and income level. 14 people
havetook loan of rs.1-5 lakh whose income is 2-4 lakh.
0
2
4
6
8
10
12
14
below 2 lakh 2-4 lakh 4-6 lakh 6 lakh and
above
less than 1 lakh 1-5 lakh 5-10 lakh more than 10 lakh
38
SATISFACTION LEVEL AND GENDER
H0: satisfaction level and gender are Independent.
H1: satisfaction level and gender are not Independent.
Level of signification is 5%.
Degree of freedom is (4-1) * (2-1) = 3
Table 16
Calculated2is6.2077
Tabulated 2is 7.815
Since calculated value is lower than the tabulated value so, null hypothesis is
accepted.so, we can conclude that gender and satisfaction level are independent.
Table 16.1
Observed
frequencies
Expected
frequncies
(O-E) (O-E)2 (O-E)2/E
7 5.76 1.24 1.5376 0.266944
10 13.68 -3.68 13.5424 0.989942
17 14.4 2.6 6.76 0.469444
2 2.16 -0.16 0.0256 0.011852
1 2.24 -1.24 1.5376 0.686429
9 5.32 3.68 13.5424 2.545564
3 5.6 -2.6 6.76 1.207143
1 0.84 0.16 0.0256 0.030476
TOATL 6.207794
Value Df
Pearson Chi-Square 6.208 3 Likelihood Ratio 6.253 3
Linear-by-Linear Association 0.157 1
39
GENDER AND LOAN AMOUNT
H0: gender and loan amount are Independent.
H1: Gender and loan amount are not Independent.
Level of signification is 5%.
Degree of freedom is (2-1) * (4-1) = 3
Table 17
Observed
frequncies
expected (O-E) (O-E)2 (O-E)2/E
2 2.16 -0.16 0.0256 0.0118
1 0.84 0.16 0.0256 0.0304
17 15.12 1.88 3.5344 0.2337
7 5.88 1.12 1.2544 0.2133
18 17.28 0.72 0.5184 0.0300
6 6.72 -0.72 0.5184 0.0771
2 1.44 0.56 0.3136 0.2177
0 0.56 -0.56 0.3136 0.5600
TOATL 1.3743
Calculated2is1.3743
Tabulated 2is 7.815
Since calculated value is lower than the tabulated value so, null hypothesis is
accepted. So, we can conclude that gender and loan amount is independent.
Table 17.1
Value df
Pearson Chi-Square 1.224 3
Likelihood Ratio 1.751 3 Linear-by-Linear Association 0.864 1
40
OCCUPATION AND PROBLEMS
H0: Occupation and problems are Independent.
H1: Occupation and problems are not Independent.
Level of signification is 5%.
Degree of freedom is (4-1) * (3-1) = 6
Table 18
Observed
Frequencies
Expected
Frequencies
(O-E) (O-E)2 (O-E)2/E
3 4.64 -1.64 2.6896 0.57965
9 7.54 1.46 2.1316 0.28270
16 14.5 1.5 2.2500 0.15517
1 2.32 -1.32 1.7424 0.75103
4 2.08 1.92 3.6864 1.77230
4 3.38 0.62 0.3844 0.11372
3 6.5 -3.5 12.25 1.88461
2 1.04 0.96 0.9216 0.88615
1 1.28 -0.28 0.0784 0.06125
0 2.08 -2.08 4.3264 2.0800
6 4 2 4 1
1 0.64 0.36 0.1296 0.2025
TOTAL 9.7691
Calculated2is9.7691
Tabulated 2is 12.592
Since calculated value is lower than the tabulated value so, null hypothesis is
accepted.so, we can conclude that occupation and problems are independent.
Table 18.1
Value df
Pearson Chi-Square 9.769 6
Likelihood Ratio 11.856 6 Linear-by-Linear Association 0.298 1
41
INCOME LEVEL AND INTEREST RATE
H0: Income level and interest rate are Independent.
H1: Income level and interest rate are not Independent.
Level of signification is 5%.
Degree of freedom is (4-1) * (3-1) = 6
Table 19
Calculated2is6.3523
Tabulated2is 12.592
Since calculated value is lower than the tabulated value so, null hypothesis is
accepted.so, we can conclude that gender and satisfaction level are independent.
Table 19.1
Observed Expected (O-E) (O-E)2 (O-E)2/E
4 2.9 1.1 1.21 0.4172
12 14.5 -2.5 6.25 0.4310
7 6.96 0.04 0.0016 0.0002
6 4.64 1.36 1.8496 0.3986
1 1.9 -0.9 0.81 0.4263
13 9.5 3.5 12.25 1.2894
4 4.56 -0.56 0.3136 0.0687
1 3.04 -2.04 4.1616 1.3689
0 0.2 -0.2 0.04 0.2000
0 1 -1 1 1
1 0.48 0.52 0.2704 0.5633
1 0.32 0.68 0.4624 1.4450
TOTAL 7.60896
Value Df Asymp. Sig. (2-
sided)
Pearson Chi-Square 7.609 6 0.268
Likelihood Ratio 8.542 6 0.201
Linear-by-Linear
Association
0.014 1 0.907
42
INCOME LEVEL AND LOAN AMOUNT
H0: Income Level and Loan Amount are Independent.
H1: Income Level and Loan Amount are not Independent.
Level of signification is 5%.
Degree of freedom is (4-1) * (4-1) = 9
Table 20
Observed
Frequencies
Expected
frequencies
(O-E) (O-E)2 (O-E)2/E
1 0.3 0.7 0.4900 1.6333
1 1.5 -0.5 0.2500 0.1666
1 0.72 0.28 0.0784 0.1088
0 0.48 -0.48 0.2304 0.4800
2 2.1 -0.1 0.0100 0.0047
14 10.5 3.5 12.250 1.1666
4 5.04 -1.04 1.0816 0.2146
1 3.36 -2.36 5.5696 1.6576
2 2.4 -0.4 0.1600 0.0666
9 12 -3 9 0.7500
7 5.76 1.24 1.5376 0.2669
6 3.84 2.16 4.6656 1.2150
0 0.2 -0.2 0.0400 0.2000
1 1 0 0 0
0 0.48 -0.48 0.2304 0.4800
1 0.32 0.68 0.4624 1.4450
TOTAL 9.8561
Calculated2is9.8561
Tabulated 2is 16.919
Since calculated value is lower than the tabulated value so, null hypothesis is
accepted.so, we can conclude that Income level And Loan Amount Are Independent.
Table 20.1
Value df
Pearson Chi-Square 9.856 9
Likelihood Ratio 10.298 9
Linear-by-Linear Association 5.116 1
43
CHEPTER 5
FINDINGS
44
FINDINGS
1. Majority of the people got loans from SBI and HDFC bank.
2. Most of the people are given important to loan tenure while choosing
loan and followed one is loan eligibility.
3. Most of the customers are facing problem of lack of knowledge because
of they are not aware about different type of facility.
4. Majority of the people pay fixed rate of interest.
5. Most of the people felt that the interest rates are somewhat high and majority of people are satisfied with the services.
6. From the research most of people are male who have taken loan.
7. Most of the people felt that HDFC provide good service compare to other banks.
45
CHEPTER 6
CONCLUSION
46
CONCLUSION
In our study we came to know that many people taken loan and most of
the people have taken loan from the SBI. Home loans have long period
when compare to other personal loans and other loans. So peoples are
confused to take a home loan. Even though the interest rates are high
peoples are willing to take a loan from SBI banks. For disbursement
process is also it will take long time so, many people face the problem of
procedural delay. Finally the whole research was carried out in a
systematic way to reach at exact results. The whole research and findings
were based on the objectives. However, the study had some limitations
also such as lack of time, lack of data, non-response, and reluctant
attitude and illiteracy of respondents, which posed problems in carrying
out the research. But proper attention was made to carry out research in
proper way and to make accurate conclusion for the home loan which
may beneficial for banks to enhance their customer base.
47
CHEPTER 7
REFERANCE
48
REFERENCE
WEBSITE:
www.shodhganga.com
www.starcum.com
www.thinkinvest.com
www.loansnews.com
www.scribed.com
REPORT:
Retail Banking – Emerging Issue in Home Loan” in the year 2005.
Performance of Housing Finance Companies” in the year 2005.
Housing credit situation in eighties “in the year 1984.
Housing Problem and Incompatibility Experience from a South Indian
State” in the year 2004.
Problem of the national housing policy” in year 1980.
49
CHEPTER 7
ANNEXURE
50
QUESTIONNAIRE
1. From which Bank have you taken loan?
1) ICICI 2) HDFC 3) UTI
4) Tata capital 5) IDBI 6) Bank of Baroda
7) SBI 8) Axis Bank 9)Kotak
10) PNB home fin. 11) Others
2. What are the criteria consider while taking a loan? (Give ranking)
Faster Processing Interest Rates Brand image of the Bank
Margin Amount payback period Schemes
Loan tenure Loan eligibility others
3. Which type of interest rate paid by you?
1) Fixed rate 2) Floating rate 3) Other
4. Are you satisfied with the services provided?
1) Highly Satisfactory 2) Satisfactory
3) Averagely Satisfactory 4) Dissatisfactory
5) Highly Dissatisfactory
5. How much loan amount you took?
1) Less than 1 lakh 2) 1-5 lakh
3) 5-10 lakh 4) More than 10 lakh
6. What problems did you face while getting home loans?
1) Lack of knowledge 2) Procedural delays and non-cooperation
3) Any other (please specify) ………………
51
PERSONAL DETAILS
Name: …………………………………………………………………………………...
Age: …………………………………..............................................................................
Gender: …………………………………………………………………………………
Occupation:
1) Professional 2) Self-employed 3) Salaried 4) Other
Which income group do you belong? (Per annum)
1) Below 2 lakh 2) 2-4 lakh
3) 4-6 lakhs 4) 6 lakh and above