1. RESEARCH PAPER
ON
DISTRIBUTION BUILDING – HOME FINANCE
FOR
ADITYA BIRLA HOUSING FINANCE LTD
SUBMITTED BY:
ASTHA LAGHATE

2. INTRODUCTION:
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 of the things that everyone one
wants to own. Home is a shelter to person where he rests and feel comfortable. Many banks
providing home loans whether commercial banks or financial institutions to the people who want
to have a home.
ADITYA BIRLA HOUSING FIANCE LTD (ABHFL):
Aditya Birla Housing Finance Limited (ABHFL) is registered with the National Housing Bank as
a housing finance company under the National Housing Bank Act, 1987. The company offers a
complete range of housing finance solutions such as home loans, home improvement and home
construction loans, balance transfer and top-up loans, loans against property and construction
finance. Through our lending solutions, we enable our customers to own their dream home. Aditya
Birla Housing Finance Limited is a part of the Aditya Birla Financial Service Group.
PRODUCTS OF ABHFL:
HOME LOAN:
ABHFL provides an especially designed home loan to build little piece of heaven and beautiful
memories in to it.
HOME EXTENSION LOAN:
A loan which is required when you need to build an extension to your existing home or when you
need more space in the existing residential property.
HOME IMPROVEMENT LOAN:
A loan which includes repairs and improvements in your existing owned residential property
suiting your needs.
PLOT AND HOME CONSTRUCTION LOAN:
A plot plus construction loan is primarily meant for those who want to purchase a plot and build a
house on that piece of land within the next few years.
HOME CONSTRUCTION LOAN:
This is a loan meant for those who want to construct their residential property on a land they own.

3. FEATURES AND ELIGIBILTY:
 Attractive interest rates
 Loan tenure up to 20 years
 Quick & transparent processing
 Choose between simple EMIs or structured repayments
 Nil pre-payment charges for floating rate home loans given to individuals
 Attractive balance transfer option available
 Door step services
 Minimum age of applicant - 21 years
 Maximum age of applicant at loan maturity - 60 years
 Minimum loan amount - 25 lakhs for Delhi & Mumbai; 15 lakhs for all other locations
 Annual reports of your employer for the last two to three years
DOCUMENTATION:
 Proof of Identity and Address: Includes voter Id, PAN card, Driving License, Passport both
for salaried as well professionals.
 Proof of Income: 3 months’ salary slip and form 16 for salaried employees on the other
hand ITR for 2 years and computation of income by CA.
 Bank statement where salary or income is credited: Latest 6 months both for salaried as
professionals.
 Proof Other Income: Rental Receipt for both.
 Property Documents: Copy of title document and approved sanction plan.
LOAN AGAINST PROPERTY
FEATURES AND ELIGIBILTY:
 Attractive interest rates
 Loan tenure up to 15 years
 Quick & transparent processing
 Collateral: Residential or commercial property
 Choose between simple EMIs or structured repayments
 Attractive balance transfer option available
 Door step services
 Minimum age of applicant - 21 years
 Maximum age of applicant at loan maturity - 60 years
 Minimum loan amount - 25 lakhs for Delhi & Mumbai; 15 lakhs for all other locations
 Loan up to 70% of the residential property value or 60% for commercial property

4. DOCUMENTATION:
 Proof of Identity and Address: Includes voter Id, PAN card, Driving License, Passport both
for salaried as well professionals.
 Proof of Income: 3 months’ salary slip and form 16 for salaried employees on the other
hand ITR for 2 years and computation of income by CA.
 Bank statement where salary or income is credited: Latest 6 months both for salaried as
professionals.
 Proof Other Income: Rental Receipt for both.
 Property Documents: Copy of title document and approved sanction plan.
FEES AND OTHER CHARGES:
Transaction Charges
Loan Processing /Administration Fee Home Loans : Up-to 1% of the loan amount
Other Loans : Up-to 2% of the loan amount
Pre-payment Charges:
Pre-closure is allowed after 12 months from
loan
disbursement date for Long Term Loans
Any part pre-payments made in the last 12
months
prior to closure will be counted towards the
pre-
closure charges
Floating rate loans given to individuals, where
all applicants and co-applicants are
individuals: Nil
Home Loans (other than floating rate Home
Loans to individuals): 2% of principal
outstanding
Loan against Property & Lease Rental
Discounting: 4% of principal outstanding
Other Charges:
Default Penal Interest Rate / Non
Conformance with
any covenants / stipulated conditions
24% p.a. i.e. 2% per month
ECS failure charges 750/- per instance
Accrued Interest As applicable based on actual delayed status or
as communicated by the lender from time to
time
CERSAI charges When facility amount is equal to 5 lacs or
lesser – 250+ST per property
When facility amount is greater than 5 lacs –
500+ST per property You may visit the
website of CERSAI for all such charges at
www.cersai.org.in
Pre-closure quote 1,000/- per instance

5. Request for Copies of any collateral held with
ABHFL
750/- per instance
Duplicate Statement/ Repayment Schedule /
any other document held with ABHFL
request
200/- per instance
Charge For Exchanging ECS mandate 750/- per instance
CIBIL report retrieval fee 50/- per instance for Consumer and 500/- for
Commercial CIBIL
Loan Re-schedulement (at discretion of
ABHFL) charges
0.50% of the loan outstanding + Service Tax
NOC issuance charges 500 + Service Tax
Swap Charges (Fixed or semi-fixed rate to
floating and vice-versa at discretion of
ABHFL)
2% of the loan outstanding
Stamp Duty
Legal and other statutory charges
Insurance Premium
Creation charge with ROC
As per actual, where applicable
REFERRAL ASSOCIATE EMPANELMENT
 This is in the form of Connectors and Direct Selling Agent (DSA)
 Both Connectors and DSA have different payout ratio for both home loan and Loan Against
Property (LAP)
Associates Home Loan LAP/LRD/CP
Connectors 0.40% 0.60%
DSA 0.60% --- up to 2 crores
0.75% --- 2 crores – 5 crores
0.90% ---more than 5 crores
0.85% --- up to 1 crores
1.00% --- 1 – 2.5 crores
1.25% --- 2.5 – 5 crores
1.35% --- more than 5 crores
 Documentation for both connectors as well as DSA are as follows:
1. Profile
2. PAN card
3. Service Tax Registration/ Exemption Certificate
4. Incorporation Documentation

6. 5. Address Proof
6. Identity Proof
7. Recent Photograph
8. Board Resolution
9. Cancelled Cheque
10. Two references with their full contact details including companies email id
COMPETITORS OF ADITYA BIRLA HOUSING FINANCE
 HDFC BANK
 HDFC LTD
 ICICI BANK
 AXIS BANK
 INDIA BULLS
 PNB HOUSING
 TATA CAPITAL
 RELIANCE
 INDUSIND BANK
 BAJAJ CAPITAL
 FUTURE CAPITAL
 MAGMA
 DHFL
 DCB BANK
 RATNAKAR BANK
THE PARAMETERS INVOLVED IN HOUSING LOAN EVALUATION:
There are a number of parameters on which the housing loans are built:
They are:
1. TENURE
The tenure of the home loan refers to the time limit for a customer to repay the loan. Generally,
the maximum tenure of home loans is 20 years, with a few lenders offering tenure of 20 years or
more (ABHFL has recently launched a 30 years loan). The longer the tenure, more a customer
pays in total interest, but monthly payments will be less.
So depending on the earning potential and bank balance of the customer, an appropriate can be
chose. An important requirement of most banks/ HFIs is that they pay up the entire loan before
you retire. The customer can always prepay the entire loan amount before it is due. As long as the
tenure goes up a customer pays more interest which is up to 0.25 – 0.5%, generally above the home
loan rates.

7. 2. AMOUNT PAID BY THE FINANCER/ MARGIN REQUIREMENTS
The financer does not pay the entire amount of the loan, they request the customer to maintain
margin, most banks go in for an 85% funding of the property value including the stamp duty and
charges, and it however varies among various banks.
This is also treated as the margin money or own contribution required to be put by the prospective
loan seeker as the contribution towards the purchase of the house. Most HFIs believe the amount
paid is upfront before they release any disbursement. As a rule of thumb, depending upon the HFC,
the prospective loan seeker has to cough up 15% - 20% of the loan amount as a down payment.
For smaller amounts, this may not be much. But for figures running into lacks, this could make
loads of difference.
For example: An apartment costing Rs. 10lacss may get 85 per cent financing. So, customer has
to arrange for the remaining Rs 1.5lacs. Some banks however make way for the payment for 90%
of financing and about 100% financing for some new projects, however they are subjected to a
large number of factors and constrains.
3. INTEREST RATES
Without doubt the most important parameter to factor into home loan calculations. The interest
rates may vary from institutions to institutions and generally range from about 9.65% - 12.75% to
around 11.5% Repayment is in the form of EMIs (Equated Monthly installments). The longer the
tenure, the more you pay in interest, but your monthly payment will be less.
The two kinds of interest rates available to a customer are:
• Fixed interest rates
• Floating interest rates
Fixed interest rates remain fixed over the tenure of the loan.
Floating interest rates are affected by the rates in the market, they fluctuate according to the rates
issued or changed by the RBI from time to time.
As per the new rate structure, customer will have to pay 10.5% on the home loans with a floating
rate, while the fixed home loan will now invite an interest of 12.5%.
With this increase, the monthly installment on an Rs.1lakh loan for 20 years goes up by Rs70.
Some public sector banks do so only once in 12 months while some private sector lenders do it as
frequently as a quarter. Though the current interest rate quote maybe lower, over the life of the
loan, a customer will be able saved more in the case of a lender who resets your floating rate more
frequently.
The investors are also given the option of changing their option from fixed rate loan to a floating
rate loan, of course by paying a penalty.