Customer Satisfaction of Housing Loan FROM SBI

Presented by :Priyanka Bhattacharya Debojeet Dutta Ayush Agarwal Debjyoti Rakshit

(12DM011) (12DM026) (12DM032) (12DM033)

Objectives of the Study

To understand the customer purpose of the categories of housing loan. To understand and compare how customers rate the services and procedures for loan application and processing in the bank. To find out overall customer satisfaction level on housing loans in the bank.

Methodology
Deciding upon the bank where the study was to be conducted. Deciding on the sample size to be taken for consideration. Finalization of sample size and the bank. Preparing a questionnaire to obtain the feedback from the respondents. Obtaining contact details of bank executives and respondents. Collection of Data through
Primary sources

Secondary Sources

Analysis of findings Conclusion and recommendations

Limitations
Delays in getting appointment from bank. Non permissibility of bank authorities to execute the survey within the Banking premises.

Customers are not willing to respond.

Customers unaware of documentation process.

About State Bank of India

Founded on 1st July 1955

Headquarters in Mumbai
Global Presence

Products include credit cards, Consumer banking, Corporate Banking, Insurance, Investment Banking, Wealth Management
Revenue -$36.95 Billion
"THE MOST PREFERRED HOME LOAN PROVIDER" voted in AWAAZ Consumer Awards along with the MOST PREFERRED BANK AWARD in a survey conducted by TV 18 in association with AC Nielsen-ORG Marg in 21 cities across India.

SBI Home Loans

Provision for on the spot " In principle" approval.

Loan sanctioned within 6 days of submission of required documents.

Option to avail Home Loan as a Term Loan or as an Overdraft facility to save on interest and maximize gains. Option to club income of your spouse and children to compute eligible loan amount. Provision to club expected rent accruals from property proposed to compute eligible loan amount.

Purpose of Housing loan

Purchase/ Construction of House/ Flat Purchase of a plot of land for construction of House Extension/ repair/ renovation/ alteration of an existing House/ Flat Purchase of Furnishings and Consumer Durables as a part of the project cost. Takeover of an existing loan from other Banks/ Housing Finance Companies

Documents required in Home Loan

Completed application form Age Proof Proof of Identity - PAN Card/ Voters ID/ Passport/ Driving License Proof of Residence - Recent Telephone Bill/ Electricity Bill/ Property tax receipt/ Passport/ Voters ID Proof of business address in respect of businessmen/ industrialists Sale Deed, Agreement of Sale, Letter of Allotment, Non encumbrance certificate, Land/ Building Tax paid receipt etc. (as applicable and subject to satisfaction report from our empanelled lawyer) Copy of approved plan and approval from the Local Body Income Proof of the applicant & co-applicant Last 6 months bank A/C statement Passport size photograph of the applicant & co-applicant

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In case of Salaried Employment certificate from the employer, Copies of pay slips for last few months and TDS certificate Latest Form 16 issued by employer Bank statements

In case of Self-employed Copy of audited financial statements for the last 2 years Copy of partnership deed if it is a partnership firm or copy of memorandum of association and articles of association if it is a company Profit and loss account for the last few years Income tax assessment order

Types of Home Loan

Home Purchase Loan Home Improvement Loan Home Extension Loan Home Conversion Loan Bridge Loan Home Construction Loan Land Purchase Loan

Steps involved in Home Loan process

Find your property Know the Home Loan Eligibility Select the Best Home Loan after evaluation Applying for the Loan Documentation & Verification Process Credit & default check Bank sanctions Loan & Offer letter to the borrower Acceptance Copy to the Bank Bank checks the legal documents Signing of agreement & the loan disbursal

Eligibility
Minimum age 18 years as on the date of sanction Maximum age limit for a Home Loan borrower is fixed at 70 years, i.e. the age by which the loan should be fully repaid. Salaried individuals Self-employed professionals/businessmen Monthly income, banks generally keep the EMI to income ratio at 0.45 to 0.50. EMI Disposable Income Duration of Loan (Years) Interest Rate (in %age) Eligible Loan Amount Existing loans - In case you have any existing loans, then the loan eligibility amount will come down to keep the EMI to income ratio around 0.50.

HOME LOANS - INTEREST RATES

With effect from 04.02.2013
All Rate are floating only (Base Rate= 9.70% p.a.)

Loan Amount

Linkage with Base

Rate over the tenor of the loan

Effective Rate

Upto Rs. 30.00

lacs Above Rs. 30.00 lacs

0.25% above Base

Rate 0.40% above Base Rate

9.95% p.a.
10.10% p.a.

No fixed rate option in any limit bracket.

Benefits
Complimentary international ATM-Debit card. Complimentary SBI Classic/ International Credit Card. Option for internet-banking. Concessional package under Credit Khazana for prospective Auto Loan, Student Loan, Personal Loan borrowers whose accounts are conducted satisfactorily. 50% concession in charges in respect of all personal remittances/ collection of outstation cheques. Personal loan at attractive rates under SBI Home Plus scheme tailored exclusively for SBI Home Loan customers.

Margin
Purchase/ Construction of a new House/ Flat/ Plot of land: 20% for loans up to Rs.30 lacs, 20% for loans above Rs.30 lacs and up to Rs.75 lacs. 25% for loans above Rs.75 lacs.

Maximum Repayment Period

For applicants up to 45 years of age: 25 years For applicants over 45 years of age: 15 years

Moratorium
Up to 18 months from the date of disbursement of first installment or 2 months after final disbursement in respect of loans for construction of new house/ flat (moratorium period will be included in the maximum repayment period).

NRI HOME LOANS:

Home Loan Products:

HOME LOANS TO NON RESIDENT INDIANS (NRIs) & PERSONS OF INDIAN ORIGIN (PIOs) Eligibility Non Resident Indians (NRIs) or Persons of Indian Origin(PIOs) The applicants should have a regular source of income. Minimum employment tenure in India/Abroad should not be less than 2 years.

Loan Amount Minimum Loan Amount: Rs. 3 lacs Maximum Loan Amount: No upper cap.
(Other terms and conditions are as applicable to regular Home Loan Scheme)

HOME LOAN AS AN OVERDRAFT

An innovative and customer-friendly product enabling the customers to earn optimal yield on their savings by reducing interest burden on Home Loans, with no extra cost.

The loan is sanctioned as an Overdraft with added flexibility to operate the Home Loan Account like SB or Current Account. Bank also provides Cheque Book/ATM-cum-Debit Card/Net Banking facility for the purpose.
The product enables customers to park their surplus funds/savings in SBI Maxgain (with an option to withdraw whenever required), especially in the wake of low yields on other Deposit/Investment products. Loan Amount Minimum Loan Amount: Rs.5 lacs Maximum Loan Amount: No Cap Interest Rate A premium of 0.25% over and above the applicable Home Loan interest rate for Home Loan > Rs.1 crore is payable. (Other terms and conditions are as applicable to regular Home Loan Scheme)

SBI-Home Equity
It is for granting personal loans to the banks home loans customers against the security of their house property. All home loans customers with a satisfactory repayment record of at least one year and who maintain a Savings bank or current account with the Bank The loan can be used for any purpose, viz. extension/repair of house, purchase of car/ consumer durables, education / medical expenses of family members, personal expenses, etc. There will be no need to obtain documentary evidence for the end-use of funds. However a certificate from the customer in the application to the effect that the loan will not be used for speculative purposes would be obtained.

Minimum Loan Amount: Rs.50.00 Lacs

Maximum Loan Amount: Rs. 2.00 Crores Interest Rate Term Loan 1.25% above Base Rate Overdraft 1.50% above Base Rate

SBI YUVA HOME LOAN

TAILOR MADE HOME LOAN SCHEME FOR THE YOUTH SBI YUVA Home Loan provides 20% higher loan amount than that of normal Home Loan eligibility to Salaried employees of Private Sector Companies/MNCs/Government Undertakings/PSUs & the Government employees. Eligibility Age between 21 years to 45 years. Minimum Net Monthly Income of applicants should be Rs. 30,000/(expected rental income from the proposed property should not be included in the monthly income of the borrower). Repayment Under SBI Yuva Home Loan Scheme, only the interest applied on Home Loan is payable during the first 36 months. The regular EMIs start after completion of 36 months. (Other terms and conditions are as applicable to regular Home Loan Scheme)

SBI REALTY
HOME LOANS FOR PURCHASE OF PLOT FOR CONSTRUCTION OF A DWELLING UNIT

SBI Realty provides an opportunity to the customer to purchase a plot for construction of house. The construction of house should commence within 2 years from the date of availment of SBI Realty Loan. Customers are also eligible to avail another Home Loan for construction of house on the plot financed under the SBI Realty with the benefit of running both the loans concurrently.
Loan Amount : Maximum Loan Amount: Rs.10 crores Repayment Period : Upto 15 years (Other terms and conditions are as applicable to regular Home Loan Scheme)

 SBI PAL
PRE-APPROVED HOME LOAN The SBI PAL provides sanction of Home Loan limits to the customers before finalization of the property which enables them to negotiate with the Builder/Seller confidently. The loan eligibility will be assessed on the basis of income details of the applicant. Non-refundable processing fee as applicable to the Home Loan will be collected at the time of sanction. Validity Period Pre-approved loan arrangement letter (PLAL) will be valid for a period of 4 months. Property papers will be required to be submitted by the borrower within the validity of PLAL. Processing fee will not be levied again. Loan Amount Pre-approved loan arrangement letter (PLAL) will carry the eligible loan amount calculated on the basis of prevailing interest rates Minimum Loan amount: Rs.10 Lacs. (Other terms and conditions are as applicable to regular Home Loan Scheme)

SBI TRIBAL PLUS

SPECIAL HOME LOAN SCHEME FOR HILLY/TRIBAL AREAS 'SBI Tribal Plus' is a Special Home Loan Scheme designed for Hill/Tribal areas (where mortgage of the property is not possible) for extending financial assistance to individuals. Loan is sanctioned for Purchase or construction of a new house / flat (without mortgage of land). Purchase of an existing (old) house / flat which is not more than 10 years old. Repair /Renovation/extension of an existing house or flat. Loan Amount Minimum Loan Amount: Nil Maximum Loan Amount: Rs. 10 lacs Repayment Period Maximum repayment tenure: 15 years

 GRAM NIWAS
HOME LOANS IN RURAL AREAS Scheme covers all Rural and Semi-urban centres having population upto 50,000 as per 2001 census. Home Loans under Gram Niwas Scheme are sanctioned for purchase/ construction/repair and renovation of house and purchase of plot for construction of a house/shed etc. Loan Amount Minimum Loan Amount: Nil Maximum Loan Amount: Rs. 5 lacs

Repayment Period Maximum repayment period :15 years (Processing Charges are waived under the Gram Niwas Scheme)

SAHYOG NIWAS
HOME LOANS TO SELF HELP GROUPS IN RURAL AREAS The Sahyog Niwas Scheme provides Home Loan to Self help groups, having good payment record of 2 years, for on lending to their members for:

Loan Amount

o Purchase or construction of a house exclusively or including the housing needs of activities carried by them (Dairy shed, tailoring shed/shop, grocery stores etc.) o Renovation or repair of an existing house / shed o Purchase of a plot for the construction of house o Extension of existing house / work space to existing house / shed.

Home Loan amount under Sahyog Niwas Scheme is restricted to 10 times of the saving corpus of SHG subject to a maximum amount of Rs. 50,000/ per member.

Eligibility:
Personal Criteria Minimum age 18 years. Valid Indian Passport (for NRIs) / valid foreign passport (for People of Indian Origin - PIOs). Steady source of income. Employed abroad for at least 2 years. Valid job contract or work permit. Minimum Net Monthly Income (NMI) of US$ 500 or minimum Net Annual Income (NAI) of US$ 6000/- (or its equivalent in any other foreign currency). Property Types Non Resident Indians (NRI) and Persons of Indian Origin (PIO) can avail SBI Home Loans for the following: New home Home improvement or extension Land purchase Home furnishings and consumer durables

SBI REVERSE MORTGAGE LOAN

LOAN FOR THE WELFARE OF SENIOR CITIZENS IN INDIA
House-owning Senior Citizens having inadequate income can avail this loan to meet their financial needs for renovation/repairs to house, medical & other personal uses. No compulsion for the borrower to repay the loan amount during his or her lifetime or till such time he or she continues to stay in the house. Borrowers have the options to prepay the loan at any time without any prepayment penalty.

Interest Rate 2.75% above the Base Rate, present effective rate being 12.50% p.a. (Fixed) subject to reset every 5 years. Disbursement Either in Monthly/Quarterly payments or 50% of the sanctioned limit in lump-sum and the remaining in periodic payments.

Quantum of loan
The loan amount would be 90% of the value of property. Loan amount would include interest till maturity. The loan installments payable to the borrower(s) would be as under for a loan amount of Rs. 1 lac (at interest rate of 10.75% p.a.): The maximum loan amount is kept at Rs. 1 Crore (monthly payment Rs. 22,500/- for 15 years) and minimum Rs.3 lacs (monthly payment Rs. 675/for 15 years). Example of arriving at the monthly instalments: Property value:Rs.10 lacs Qualifying loan amount (90% of property value):Rs.9 lacs Tenor:15 years Monthly instalment: Rs. 225 x 9 = Rs. 2,025/-

Loan Tenor (years) Monthly instalments (Rs.) Quarterly instalments (Rs.) Lumpsum payment (Rs.)

10 468
1,423 36,022

15 225
687 21,619

Customer Satisfaction Survey Report

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Conclusion & Recommendations

SBI is the best home loan provider despite stiff competition from HDFC due to following facts:

The SBI has made home loans in India easy. The home loan provides ideal home loan product for the borrowers including ready to move-in property, under-construction property, selfconstructions and lots more. It provides adequate home loans at suitable interest rate and time period. SBI offers excellent customer friendly services. SBI offers housing loan on complete transparency with no hidden costs or administrative costs. Lowest Equated Monthly Installments ( EMI ) Lowest interest rates, currently between 7.50% pa and 8.50% p.a. Unique facilities such in principle approval, overdraft facility, option to enhance loan amount eligibility, free personal accident insurance & varied schemes like the plus schemes.

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But still SBI has to look after certain factors to improve its position.

Recommendations: SBI has to focus on marketing its home loan products in more efficient manner so that not only the customers but also the builders will be well aware of it. Advertisement is essential for any product and it should be given major importance. The features and advantages with SBI over other players are to be comparatively analyzed and displayed for information of others.
It should focus on fast processing of housing loans keeping in mind the pace of other banks. SBI should market the products which are provided specially under NRI housing scheme which has not been geared up , This needs to grow internationally.

Continued.
Special focus to be given to tap the high net worth individuals through personalized services at their door step. Free value added services provided to the housing loan customers and the rewards that the Bank provides for being a regular customer are not within knowledge of customers . This should be highlighted which not only bring more customers but also attracts more business from the existing customers. Effective marketing through wide publicity, personalized services and speedy disposal to be given still more importance by SBI which will undoubtedly lead to increase its market share in HOUSE FINANCE.

Reference
https://www.sbi.co.in/user.htm, SBI home website. www.deal4loans.com www.moneyduniya.com/loan/mortgage/sbi/ www.onlinesbi.com/nri/loans/sbinri_lon_homlon.ht ml

Thank you