A "low interest" loan shouldn't mean you have very little interest in paying it back!
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  • Real Estate Investing and Financing

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  • A small part of the real estate purchase price comes from the savings of the person who is buying the property. However, there are other sources too that can be availed while purchasing real estate.

    The sources can be broadly classified under four categories:

    1. Primary Sources
      • Mutual Savings Banks
      • Commercial Banks
      • Savings and Loan Associations
      • Life Insurance Banks
    2. Financial Middlemen
      • Mortgage Bankers
      • Mortgage Brokers
    3. Other Sources
      • Finance Companies
      • Pension Funds
      • Credit Unions
      • Real Estate Investment Trusts
      • Foreign Funds
      • Individual Investors
      • Farmers Home Administration
    4. Secondary Mortgage Market

    Reasons Why Real Estate Investors Invest on Projects of Housing Finance Companies:

    1. It has been growing at a minimum of 30% CAGR which effectively means doubling the business and profit each 2.5 years which is quite good.
    2. Home loans are the cheapest, safest and best form of loans because of the heavy mortgage of homes as security attached.
    3. Home loans being an emotional attachment to home owners, normally has much lesser defaults.
    4. With the huge need and push for affordable housing, mainly to primary segment, the housing finance domain is poised to exponential growth.
    5. As a thumb rule, scale, business maturity, profitability and growth moves in the following direction:
    6. Labour, Manufacturing, Trading, Technology, Services, Financial Services.
    7. Home finance belongs to the top level of the growth pyramid and it is followed by services, technology and trading.
    8. Home finance people get almost 3 times the money invested for a 20-yrs loan. Hence, you just need to get a customer once and your income for next 20 years is almost guaranteed.
    9. ARPU (Average Revenue per User) in case of home loans is one of the highest across industries due to high Ticket Size of homes, which comes in Lakhs and now in Crores.
    10. Home finance in India is still in a very embryonic stage with a very small percentage of people taking or getting home loans.
    11. RERA, Aadhaar, Main streaming of real estate will lead to more and more organised real estate players in the market which will automatically lead to much higher and safer business for home finance companies.
    12. Due to the strict loan conditions set by the Reserve Bank of India, we are still not at all a highly leveraged society, unlike the USA and other developed countries.
    13. As a thumb rule, the more a country grows, over a period of time, the more interest rate gets reduced (like most developed economies have sub 1% or even negative interest rates). Hence, for a period of 20 years or more, this may be the best time to offer loans at one of the highest rates and hence great profitability as interest rates are going for a downtrend since past sometime.
    14. Unlike banking, the net NPA levels are much lesser in home finance companies as compared to the banking sector.

    Hence, home finance companies may be one of the top three sectors for next few years or even for decades as far as stock investments are concerned.

    Best Housing Finance Companies

    As per our analysis, Order (best to worst) of housing finance companies based on their fundamental strength on the basis of their quality, valuations and financial trend:

    1. CAN FIN Homes
    2. DHFL
    3. Indiabulls
    4. HDFC
    5. PNB Housing Finance
    6. LIC Housing Finance
    7. HUDCO
    8. Gruh finance.
    9. GIC Housing Finance
    10. Indbank Housing Finance
      

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    Real Estate Investing Reviews

    • Punjab National Bank Home Loan
      "Average service"
      0.5 3.0/5 "Satisfactory"
      I have availed Home loan directly through Punjab National Bank .The rate of interest and the processing fee was very high ,I have got the loan amount on delay basis and i have applied for 26 lakhs for the tenure of 15 years.I have not faced any difficulties until i have received the loan .
      Was this review helpful? 0
      , new delhi
      Reviewed on Oct 14, 2019
    • SBI
      SBI Home Loan
      "Excellent Loan Service"
      0.5 5.0/5 "Blown Away!"
      SBI Home Loan is excellent because I've a salary account with them. They offered me a interest rate of 9.5% approximately. I took the loan amount of Rs. 23 lakhs so far i have got only Rs. 16 lakhs since my building is under construction. My EMI is not yet started. They sanctioned the loan in 2 working days.
      Was this review helpful? 0
      , dindigul
      Reviewed on Oct 14, 2019
    • SBI Home Loan
      "Easy and best loan"
      0.5 5.0/5 "Blown Away!"
      SBI is a best bank and they had a better option. There is only simple documentation required and executive came to my place for collecting all the documents. I got the loan within 7 days. SBI did not taken any processing charges and they gave better and cheap interest. They take minimal time and better response from the customer care so i had chosen SBI for my home loan.
      Was this review helpful? 1
      , agra
      Reviewed on Oct 11, 2019
    • Central Bank of India Home Loan
      "Highly recommendable bank"
      0.5 5.0/5 "Blown Away!"
      My home loan was purchased from Central bank of India. The branch offer was approved the loan immediately and they had a good behavior with the customer. I got the better clarity about the loan process as well as the rate of interest in central bank of India is less than compared to others so i have chosen this bank and the Branch Manager helped me in a better way.
      Was this review helpful? 3
      , bhubaneshwar
      Reviewed on Oct 05, 2019
    • DHFL Home Loan
      "Need to decrease interest charges"
      0.5 5.0/5 "Blown Away!"
      From DHFL I have taken a home loan almost more than a year. One of my cousin's friend working there he recommend to apply for a home loan. The process was smooth and sanctioned a loan within 6 days with sufficient amount of 20 years. The rate of interest was high.
      Was this review helpful? 3
      , vijayawada
      Reviewed on Oct 05, 2019
    • ICICI Bank Home Loan
      "Average Loan service"
      0.5 3.0/5 "Satisfactory"
      ICICI bank has provided me a home loan at the time of i want on a immediate basis. Since the necessity is over they have provided me a timeliness loan. I taken the loan amount of Rs. 10 lakhs and the have charged me a higher interest rates which i'm not comfortable with.
      Was this review helpful? 1
      , mumbai
      Reviewed on Oct 05, 2019
    • HDFC Limited Home Loan
      "Excellent"
      0.5 5.0/5 "Blown Away!"
      I have balance transfer for a home loan with existing finance to HDFC LIMITED. One month before only I have a transfer of a loan. They have outstanding amount of 10 lakhs for the tenure period of 10 years. The rate of interest is 8.6% only for mortgage charges for 8 thousands need to pay for it.
      Was this review helpful? 1
      , goa
      Reviewed on Oct 04, 2019
    • review Home Loan
      "Need to decrease charges & improve customer service "
      0.5 1.0/5 "Really Bad"
      I have taken a home loan with SUNDARAM FINANCE on 10 years before which was processed through them directly. The amount which was given for 13 lakhs for the tenure period of 20 years. There was lot of issues I faced with them customer service is not good response. The rate of interest was high of 14% compare to other.
      Was this review helpful? 1
      , goa
      Reviewed on Oct 04, 2019
    • SBI Home Loan
      "Excellent Service"
      0.5 5.0/5 "Blown Away!"
      I have taken home loan directly through State Bank Of India .The rate of interest and the processing fee was nominal ,I have got the loan amount on time and got a clear picture about the loan process ,I have availed this loan for the tenure of 20 years .I have completed only 2 years of EMI so far .,
      Was this review helpful? 3
      , vizianagaram
      Reviewed on Oct 04, 2019
    • Central Bank of India Home Loan
      "Average service"
      0.5 3.0/5 "Satisfactory"
      I have taken Home loan directly through Central Bank OF India ,I have got the loan on exact time ,The rate of interest and the processing fee was nominal ,I have got all the details about this loan very clearly through bank agent.The process was very easy and still this loan is active .
      Was this review helpful? 1
      , ramanathapuram
      Reviewed on Oct 04, 2019
    • SBI Home Loan
      "Good"
      0.5 5.0/5 "Blown Away!"
      Nearly 11 years before I had taken a home loan with STATE BANK OF INDIA which was processed directly to them.The loan amount was sufficient for the tenure period of 15 years. The rate of interest and processing fee are nominal. They have sanctioned a loan within few days and the process was good.
      Was this review helpful? 1
      , itanagar
      Reviewed on Oct 04, 2019
    • Central Bank of India Home Loan
      "Easily accessible bank"
      0.5 4.0/5 "Great!"
      I have just applied the home loan from Central bank of India. I had a reference over there hence i applied the home loan from Central Bank of India. Documentation process was hassle free. They have offered me a interest rate of 10.1% and the processing fee was 1% of the interest amount +18% GST charges. They have dispatched the loan 20 days. The staffs are so friendly
      Was this review helpful? 2
      , bangalore
      Reviewed on Oct 01, 2019
    • HDFC Limited Home Loan
      "Customer friendly loan service"
      0.5 4.5/5 "Excellent!"
      HDFC was the only bank which is offering for the home loan in the area where i have purchased the house so i opted with HDFC LIMITED. I had applied the loan amount of Rs. 28 lakhs and the given interest rate is 8.5% and they charged me a processing fee of nominal one. I took the loan 3 years ago and they took 40 to 50 days to sanctioned the loan.
      Was this review helpful? 2
      , ambala
      Reviewed on Oct 01, 2019
    • Punjab National Bank Home Loan
      "Very ease to get the loan"
      0.5 4.0/5 "Great!"
      I took a home loan with PNB Housing Finance Ltd because the terms and conditions are very liberal at that time, I have been expecting higher loan amount for my purchase. They have fulfilled my requirements and its more than 90%. The rate of interest is little bit higher and they are not following RBI guidelines. When interest rate is increased, they have started charging more but not reduced when it got reduced.
      Was this review helpful? 1
      , palakkad
      Reviewed on Sep 29, 2019
    • HDFC Limited Home Loan
      "Excellent"
      0.5 4.0/5 "Great!"
      I have completed my home loan with HDFC BANK before 3 years ago. I did foreclosure and that time the interest rate is not much. I bought a residential property and the loan procedure is very easy because my papers are strong and clear to proceed faster.
      Was this review helpful? 1
      , madurai
      Reviewed on Sep 29, 2019
    • Bank of Baroda Home Loan
      "Good Service"
      0.5 3.0/5 "Satisfactory"
      I have applied for Home loan directly through Bank Of Baroda and got the loan on stipulated time .This loan was upto 15 years and got the loan amount on time ,The agent gave all the required information about the loan process .I have got all the required details about the loan process and there was no drawbacks faced as well.
      Was this review helpful? 2
      , surat
      Reviewed on Sep 29, 2019
    • LIC Housing Home Loan
      "Not satisfactory"
      0.5 3.0/5 "Satisfactory"
      I am not happy with rate of interest which was given by LIC Housing Finance. I have purchased the Flat in 2017August. The loan amount was 40L and its 15 years tenure. The processing fee is not applicable. The customer service is good. But every year, they are raising the interest rate which was not good.
      Was this review helpful? 2
      , visakhapatnam
      Reviewed on Sep 28, 2019
    • Punjab National Bank Home Loan
      "Average Banking Services"
      0.5 3.0/5 "Satisfactory"
      Chosen the home loan from PNB housing but the charges are very high and the services are not upto the mark. Its Government undertaken organization hence i got the loan from them. They do not take so much time to deliver the loan. They have sanctioned the loan in 20 days. Their interest rate is 10.75% hence now i want to transfer the loan to some other bank.
      Was this review helpful? 5
      , new delhi
      Reviewed on Sep 24, 2019
    • ICICI Bank Home Loan
      "Need to be very clear with the process"
      0.5 1.0/5 "Really Bad"
      I am running a home loan with ICICI BANK and making the payments time to time from last 3 years. They have provided me 31L to purchase residential property but the loan process and services are not good, whatever I enquire they don't know that. The interest rate was very good.
      Was this review helpful? 1
      , hyderabad
      Reviewed on Sep 24, 2019
    • LIC Housing Home Loan
      "Interest rate should be ecnonomic"
      0.5 4.0/5 "Great!"
      My home loan running with LIC, I availed Rs. 32 lakhs the process was hassle free. The field executive gave me the door step service and within 20 days I received the money based on the builder plan in one shot. But the drawback with them is the rate of interest is higher than others.
      Was this review helpful? 2
      , ghaziabad
      Reviewed on Sep 23, 2019
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