CREDIT POLICY STAR HFL - CREDIT TEAM - : Star Housing Finance Ltd.
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CREDIT POLICY
STAR HFL
CREDIT TEAM
VERSION 1.1Credit Policy
Sl No Version Author(s) Date Dept.
Mr. B.S Kacchawaha
1 1.0 26.05.2016 Credit & Risk
Mr. Ashish Kothari
Mr. Shakir Sheikh
2 1.1 20.01.2021 Credit & Risk
Mr. Sudhir Menon
Approval Note -
VERSION 1.0 - The policy was drafted by Mr. Ashish Kothari (Credit Manager) and
was reviewed by Mr. B.S. Kachhawaha and approved by board in the year 2016. The
same was presented to the board for approval on 26th May, 2016. The Board of
Directors and management Committee approved the policy on the same date.
VERSION 1.1 - The policy was revised by Mr. Shakir Sheikh (Mortgage Consultant)
and was reviewed by Mr. Sudhir Menon (Chief Manager – Credit), Mr. Ashish
Kothari (Credit and Risk Manager ) and Mr. B.S.Kachhawaha (Chief Risk Officer). The
same was presented to the board for approval on ---------------. The Board of Directors
and management Committee approved the policy on the same date.
1|PageCredit Policy
Statement of confidentiality –
This document is for limited circulation and will be available to
all employees only in the concerned department on need basis.
Notice of distribution
Any request to update this document will need a management
approval.
This document contains proprietary and confidential
information of STAR Housing finance Limited. The recipient
Notice of confidentiality
agrees to maintain this information in confidence and not
reproduce or disclose the same.
Document Control –
Description Name Date
Author Mr. Shakir Sheikh 20-01-2021
Mr. Sudhir menon,
Reviewed and
Mr. Ashish Kothari --------
recommended by
Mr. B.S. Kachhawaha
Approved by Mr. Ashish Jain --------
2|PageCredit Policy
INDEX
Sr. No Contents Page No
1 PURPOSE, SCOPE AND RESPONSIBILITY 04
2 MORTGAGE MARKET OVERVIEW 05
PROFILE OF SHFL
2 06
VISION:
VALUES:
3 OBJECTIVES OF CREDIT POLICY 07
4 PRODUCT RANGE 08
5 KYC DOCUMENTS 10
COMMON CREDIT UNDERWRITING QUALIFIER FOR ALL
6 11
PRODUCTS
7 PRODUCT GUIDELINES 21
UNDERWRITING STANDARDS
8 24
ADDITION INCOME TO BE CONSIDERED
INCOME NOT TO BE CONSIDERED
9 UNDERWRITING METHODS 27
10 INCOME OWNERSHIP MATRIX 29
11 APS PROCESS & CRITERIA 31
12 PRICING MATRIX 32
13 DISBURSEMENT RECOMMENDATION CHART 44
DEVIATION MATRIX
GENERAL
14 CREDIT BUREAU 46
LEGAL
TECHNICAL
3|PageCredit Policy
PURPOSE & SCOPE- RISK & CREDIT ASSESSMENT PROGRAMS –
This manual defines the Underwriting process for the credit department, credit has to
ensure that the credit decisions falls within the Credit Policy & guidelines. All credit
decisions will be made by the Credit Managers with defined credit authorities as
approved by MD &CEO / Executive Management Committee / National Credit
Manager. Subsequently all files are checked by the operations team at centralized
operations for compliant of the policy before sanction / disbursal and booking on the
system. It is instructional in nature with the main intention being the communication
of the policies and procedures of the company to all the staff involved in the lending
process. The main objectives of the Credit Operating Manual are: (what about desired
composition of the portfolio such as to geography, rating, occupation and similar
other classifications).
To promote a sound, healthy, viable and cost effective housing finance model to
cater to identified target segments and to integrate the model with the overall
financial system.
To manage & monitor credit risk in lending
To build a robust process with co-ordination, support of all concerned
departments
To act as a learning & reference tool for all employees
To generate business in a competitive environment by having sound processes,
good credit decision & better service to the customer
To keep a balance between profit, delinquency, company reputation & customer
interest
To build the goodwill of existing & new customers through clear & transparent
guidelines
To enable the customer to realize their dreams of owning a home
RESPONSIBILITY –
The Credit department will implement credit procedures consistent across all delivery
channels of STAR HFL in line with its goals and objectives. Its primary responsibility
will include management of company’s complete loan portfolio and all aspects of the
lending support activities including analysis, underwriting, processing,
documentation, record retention and review functions to ensure existing and
proposed loans adhere to established regulatory and policy guidelines.
4|PageCredit Policy
POLICY OWNER –
NATIONAL CREDIT HEAD, CREDIT AND RISK COMMITTEE AND MD AND CEO
OF STAR HFL.
MORTGAGE MARKET OVERVIEW: LOW COST HOUSING - THE KEY
GROWTH DRIVER –
Home loan is one of the most important products in the retail consumer segment. It
has a huge bearing on the customer acquisition/ retention strategy. Housing Finance
Industry is one of the fastest growing Industry in India with roughly Rs.10 trillion
Mortgage Market, and has immense untapped potential with more than 90% of
shortage in Low Cost Housing segment. Penetration from formal lending source is
less than 10% of total Mortgage Finance, which is far below as compared to the other
Countries in the World.
Mortgage as % of GDP
100%
88%
81%
80%
60%
48%
39% 41%
40% 32%
26% 29%
17% 20%
20%
9%
0%
While several Housing Finance entities like Public and Private Sector Banks, Housing
Finance Companies, Co-operative Societies, and other informal Loan bodies exist in
current economy, retail level financing of affordable Low cost housing largely remains
untapped and unaddressed. This happens typically due to the lending systems which
is based on formal evidences of customer’s Financials for lending, and the unserved
and Under-served segment continues to remain unattended.
5|PageCredit Policy
Significant increase is expected in households in LIG and MIG income bracket of The
Next Billion, primarily due to large scale urbanisation.
In addition, with Government’s relentless focus on providing housing to all and
thereby stimulating economic development and growth along with Social well-being,
the Housing Finance sector in India is looking at exciting times ahead.
Another interesting development is that around one third of new Home Loans market
in terms of units, has started flowing in the low-cost housing segment. According to
Bankers trust, there’s an estimated housing shortage of 39.3 million in rural India, the
reason why financial intermediaries still have huge scope to serve this Industry.
PROFILE OF STAR HFL –
Star Housing Finance Private Limited (SHFL) is a Housing Finance Company,
Registered with National Housing Bank (NHB). Head Quartered at Udaipur, we aim
to expand in various locations, Cities and States in the near future.
We Deeply Believe and endeavour to serve the Customers who have passion and a
Dream to build their First Home.
Our Business focus is to reach across to the large untapped potential of Unserved and
Under-served Segments where the Urban Housing Shortage exists. We aim at
unwavering commitment towards providing financial accessibility for First Home
buyers in this category of the Semi Urban and Rural Areas of India.
We at SHFL believe there is an enormous potential to make a difference by enabling
scalability, enhanced customer analytics by offering Customized products, addressing
the challenges in assessment of formal Income and repayment capacities of Customer.
On Technology and Service side, through door step easy, convenient and assisted on-
boarding, and by being Transparent, our focus will be on Financial Literacy and
Operational efficiencies with meaningful Customer Service ethics.
VISION –
Cater to Home Finance needs of customer segment which has limited access to Long
Term Finance & provide best in class personalized service at affordable cost with key
thrust on “Convenience, Relevance & Simplicity”.
6|PageCredit Policy
OUR VALUES –
Integrity, Transparency, Customer Centricity & Simplicity.
CREDIT POLICY
STAR HFL has laid down the credit policy and guidelines for the assessment of
borrower, which helps in the effective verification of the details provided by the
applicant and evaluation of ability of the applicant. The Credit policy is driven by a
detailed appraisal of the applicant’s Credit Worthiness with emphasis on the 5 Cs of
credit summarized as Character, Capacity, Capital, Collateral and conditions. There is
also an emphasis on complete and proper documentation that ensures security to each
transaction and provides adequate protection to the Bank’s rights on the asset
financed. Home loan processing involves assistance from certain vendors for
providing various legal, technical and verification services to the business and is also
the external stakeholders.
The Credit policy is prepared with the aim to promote a consistent, informed and
practical approach and standard framework of all the activities to be complied with,
in the Life Cycle Management of loans.
The Policy sets forth the procedures, processes and standards to be complied with, for
all activities including first time Customer touch, Loan boarding, Disbursal and Life
Cycle Management of loans. It further provides the Standard Operating Procedures
(SOP’s) which are informative on carrying out various activities within the function
as well as with the customer.
The Policy is provided as a reference that may be informative when carrying out
various activities within the function as well as with the customer. This Manual
incorporates the process in relevance to the NHB guidelines & amendments.
OBJECTIVES OF CREDIT POLICY
The Objectives of Business Process are:
Establish Standard Operating Procedures (SOP's) for each activity in the purview
of Organizational work.
Document the processes and internal and regulatory reporting requirements.
7|PageCredit Policy
Establish key controls and Procedures that will add to the Company's overall Risk
Management and Control Measures.
Serve as a guide for understanding the Work flow within the Department.
Comply with various guidelines of National Housing Bank (NHB) and Financial
Intelligence Unit (FIU), like Anti Money Laundering (AML) practices, Know Your
Customer Policy (KYC) etc., which aim at educating and creating awareness
among the employees to understand customers in a better way to manage the risk
associated with funding.
Follow Fair Practice Code to promote good practices, adopt transparency and
thereby encourage market forces.
All the functions within the Organization are framed with the objective of having
dedicated focus on each activity across all the functions.
USERS -
The Credit Policy standards will be accessible to all the members in the Organization
who are responsible for implementing its instructions.
The relevant sections of this Policy must be read by the concerned employees of the
Company. It should be used as a basis for guidance, training and updating procedural
knowledge for implementation.
PRODUCT RANGE –
No. Product type Product Name Validation
New Purchase - Flat
Loans will be extended for
/House/ Bungalow/
purchase of residential properties
Row House from
in approved locations. The
1 Home Loan Builder/ Allotted by
residential properties can be New
Development
Home purchase or Resale Property
Authority/ Registered
purchase.
Society
8|PageCredit Policy
Resale - Flat/ House/
Row House by
Allottee/ Member of
Registered Society/
Allotted by
Development.
Authority.
Loans will be extended for
purchase of under construction
Residential properties. Property
should be part of Approved
Builder/ Society/ Development
Home Renovation/ Extension Authority. End use of this loan
2
Improvement of Owned House should be towards acquisition of a
residential dwelling and
construction of the dwelling/unit
should be minimum 40% complete.
Disbursement will be based on the
stage of construction.
Home Loans will be extended for Home
Construction Construction of House Construction on Self–Owned Plot.
3
on Self - on Self-owned plot Disbursement will be based on the
Owned Plot stage of construction.
Balance Transfer of Loans will be extended for Balance
Loan from HFC/ Transfer from other Financial
Bank/ Co-operative Institutions, which may arise out of
Society interest rates, service issues etc. In
Balance
4 Balance Transfer + Top addition, Top Up loan option for
Transfer
up personal use and additional loans
for extension/renovation will also
Balance transfer+ be made available as per the
extension/renovation eligibility norms.
loan
Business Loan against MSME loans will be extended to
Micro, Small Property Collateral for the Small Entrepreneurs looking
& Medium Expansion, Working for business growth. The loans will
5 Enterprise Capital needs or any be provided for purchase of fixed
(MSME other specific business assets, Machinery, Equipment’s,
Loans) need (Non- Procurement of stocks and other
Speculative). business improvement activities.
9|PageCredit Policy
(Applicable for existing These loans will be made available
& New customers) only against Property Collateral.
Loans will be extended for
Plot purchase purchase of plot from
In this product ,
+ individuals/builder/society and
customer can avail loan
6 construction- for Home Construction on Plot.
for buying plot and
composite First Disbursement will be for
construction thereon
loan buying plot and subsequent based
on the stage of construction.
KYC DOCUMENTS –
Particulars Details
Identity Proof Aadhar Card – Mandatory
PAN card - Mandatory
Driving License
Voter’s Identity Card
Valid Passport
Job Card issued by NREGA duly signed by State Government
officer.
Residence Aadhar Card
Proof (any Residential - Sale deed / Registration Certificate.
one, Latest Telephone Bill or Mobile Bill (not older than 30 days) of
Applicable any Service provider.
for Borrower /
Latest Utility Bill - Electricity Bill or Water Bill (not older than 30
Co-Borrowers
days & accompanied by Rental / Lease Agreement).
& Guarantor)
Registered Rental / Lease Agreement on Stamp Paper.
Consumer Gas Connection Card / Book / Gas Bill / Statement of
Account or Pass Book of a Scheduled Commercial Bank /
Certificate from the Post Office / Post Office Savings Pass Book /
India Post Bank / Small Finance Banks showing transactions of
past 3 months (The entire address should be clearly visible in the
document & photo should be verified with Seal and Signature of
the Bank Officer). In States where the Banks are using stickers on
Passbook instead of Authorized Seal - it can be accepted if the
sticker bears issuing Bank details).
Recent Premium Receipt from LIC of India (with the Current
Address mentioned).
10 | P a g eCredit Policy
Certificate by Village Extension Officer (VEO)/ Village Head or
equal Rank Officer.
Domicile Certificate with Communication Address and
Photograph.
Proof of Residence issued by Local Authorities (Gram Panchayat).
Business Valid Shop & Establishment Registration Certificate.
Address Proof Business license from local municipal authority.
(any one) GST Registration Certificate.
Local Municipality, Nagar Parishad, Gram Panchayat or similar
Trade Authorities certificate or Receipts of Payment made to such
authorities.
Original Trade Purchase & Sale Bills which are at least 2 years old.
Property Tax Receipts / 8A Abstract / Utility Bill/ Electricity Bill
or Water Bill (latest and valid).
Sale Deed of business premises.
Registered Rental/ Lease Agreement on Stamp Paper.
Financial Updated Bank Passbook or Bank Statement of all Bank Accounts
Documents (not older than 15 days) showing transactions of the past 12
months.
Balance Sheet/ Audited Financial Reports with ITR of last 2 years
(if available).
Repayment Track records of all live Loans for last 12 months or
Bank statement showing track for 12 months along with sanction
letter for the credit facilities availed.
Signature Signature verification from Bank
Verification Pan Card
(any one) Passport Copy
Clearance of application fees cheque copy
Driving Licence
KYC KYC Verification of Pan Card & Aadhar Card is mandatory thru
Verification bellow mentioned authorised web address
(Mandatory) Pan Verification: https://incometaxindiaefiling.gov.in/
Aadhar Verification: https://uidai.gov.in/
ALL PRODUCT COMMON CREDIT UNDERWRITING QUALIFIERS
Particulars Details
11 | P a g eCredit Policy
Minimum Age at Minimum 21 years
entry (Applicant
/ Co- Applicant)
Maximum Age at For Salaried individual, 60 years or retirement age whichever
loan maturity is Higher.
(Applicant / Co-
Applicant) For Self Employed individual, 70 years of age at loan
maturity.
Property Age Property Age maximum 35 years at the time of login
The residual life of property should not be less than loan
tenure.
Security Mortgage to be created in Builder Purchase, Resale, Home
Improvement, Balance Transfer cases and unless otherwise
specified in Sanction Letter / Legal Report.
Registered Mortgage to be executed in the states where it is
compulsory and in BT Cases where previous lender has
executed Registered Mortgage.
Registered mortgage in high risk customer profile as
perceived by Credit /Management.
Negative Properties purchased on multiple POA basis.
Properties Properties in the name of HUF Entities.
Properties in the name of Minor.
Commercial / Agricultural / Industrial Zone Properties.
Properties in place falling under Company’s Negative Area
List / Un-approved Location.
Properties without an independent access or common access
as part of the approved plan / physical verification.
Properties not identified under residential zone.
Properties identified by Technical Valuer as High Risk.
Red Zone Areas of Gram Panchayat / Municipal
Corporation and Blue Line Areas.
Seized Properties.
Negative Area Property should not be in negative area.
Customer’s residence should not be in negative area.
Customer business set up should not be in negative area.
Property in vicinity of Slums / Notorious Localities / Illegal
Business activities
Negative area for a branch to be decided by BCM and Unit
head.
Negative Profiles Practising Lawyers
12 | P a g eCredit Policy
Stock/ Commodity/ Mutual Fund Broker/ Lottery Agencies
Real Estate Agent/ Builder/ Developers & Individual Brick
and Sand Suppliers
Cable Operators
Owner of Motor Driving School / RTO Agents
Owner of Bar/ Wine Shop (family restaurant cum bar can be
considered)
Film / TV Artists
Owner & Employees of DSA/ Verification agencies/
Recovery Agents
Money Lender/ Pawn Broker/ Plantation Company/ Multi-
Level Marketing Companies (MLM)
Butcher Profile without Business Entity Registration
Tour & Travels
Diamond Traders
Police Department/ CRPF/ Merchant Navy Staff/ NRI
Individuals with Political/ Criminal Background
Minimum Carpet The Minimum Carpet area of the residential unit/property
Area to be funded should be 250 Sq. Feet. For government allotted
properties/projects, lesser carpet area ( 200 sqft ) can be
considered.
Acceptable Property to be mortgaged should have perfect & marketable
Properties title and mortgage must be enforceable and SARFAESI
Compliant.
Prohibitive No Transaction between family member will be funded
Transaction under home loan purchase product.
If the transaction is done with arm’s length on purely
commercial consideration & duly stamped & registered
instrument, the same may be considered on case to case basis
with prior approval.
Borrowers and Minors cannot be taken as Borrower / Co-Borrower in the
Property Loan.
Ownership
All Property Owners will have to be Co-Applicants to the
Loan.
Spouse, Parents, Brother staying in same Family, Son,
Unmarried Sister can be taken as Co-Applicant to the Loan.
Income of Co-Applicant can be considered for eligibility (refer
Income Grid)
13 | P a g eCredit Policy
Borrower SALARIED (FORMAL- DOCUMENTED INCOME ):
Segment Individuals working in full/part time employment for fixed or
variable monthly remuneration with proper proof of salary are
categorized as Formal Salaried Segment. Salary credited in
bank. If TDS deducted form no 16 available. PF/insurance
deducted if applicable.
Applicants working with the below mentioned entities can be
broadly categorized as belonging to Formal Salaried Segment:
Proprietorship firm
Partnership firm
Private Limited Companies
Govt. Institution / Semi-Govt. Institution
Public Sector Undertaking
SALARIED (SEMI FORMAL- SEMIDOCUMENTED):
Individual working on full/ part time employment for fixed or
variable Monthly Remuneration/ Cash remuneration but
PF/ESIC being deducted from salary or if TDS deducted form
no 16 available. Bank account showing transactions to establish
monthly cash inflow. RTR if any proving repaying capacity of
EMIs.
SALARIED (INFORMAL- UN-DOCUMENTED- Individual
working on full/ part time employment for fixed or variable
Monthly Remuneration/ Cash remuneration, but not having
proper proof of salary is categorized as Informal Salaried
Segment. However credit can verify the salary through
voucher/register maintained by employer. Bank account
maintained.
SELF EMPLOYED PROFESSIONAL (SEP):
Individuals engaged as Registered Medical Practitioners
(Homeopathic Doctors, Ayurvedic Doctors), Path Lab Owners,
Tax Consultants and other Professional Degree holders having
independent practices are categorized as Self Employed
Professional (SEP).
Self Employed Non-Professional: (SENP)
Individuals engaged in any Trade / Business of Manufacturing,
Wholesale, Retail or Service Industry like Bakers and
Confectioners, Cloth Business, Dairy Supplier, Provision Stores,
Fabricators, Laundry and Dry-Cleaning Stores, Packing &
Packaging Business, Tailoring and Embroidery, Hotel Business,
Handicraft, Automobile Business, Beautician etc. are
categorized as Self-Employed Non-Professional (SENP).
NOTE- SEP AND SENP are also categorized as documented,
semi documented and undocumented basis on income proof
available. Pricing and loan exposure cap fixed basis on the
14 | P a g eCredit Policy
category of income proof available.
AGRICULTURE INCOME ASSESSMENT METHODOLOGY
LAND OWNERSHIP- Applicant/co-applicant should own
agriculture land.
LAND OWNERSHIP PROOF- land revenue records (
7/12 extract/ jamabandi/ b1 p2/ patta/chitta/A extract
)in the name of the customer.
PHYSICAL VERIFICATION OF LAND AND INCOME
ASSESMENT BY CREDIT PERSONNEL OF THE
BRANCH-
A. Credit needs to visit on site and to check the area
of land and match with the revenue records.
Possession of land of our customer to be verified from
the documents as well as to check with the neighbors.
B. Take details of each crop ( Rabi/Kharif) and
quantity produced, expenses of cultivation and sale
value of crops, and then derive the net profit.
C. Supporting/bills of crops sold and or verify the
receipts of warehouse.
D. Cross verification of agriculture income-
Certificate issued by competent authority (village
officer/ talati/patwari) can be considered.
E. Agriculture Income declared in income tax returns
can be also taken into consideration but the assessed
income would be finally considered for calculation of
loan eligibility.
F. Bank statement to be checked for minimum one
year to understand the average bank balance and
inflow of income.
G. The credit team suggested to gather information
regarding the crops cultivated in their areas, average
productions per bigha/acre/hector and expenses
incurred for the cultivation and sale value of crops so
that net income from agriculture land can be
derived.
Guarantor Guarantor to be taken when stipulated by Credit
Guarantor can be a friend / business associate of the
applicant who is ready to guarantee the loan.
15 | P a g eCredit Policy
Guarantors Residence and Business/ Office Verification
should be positive.
Guarantor should not have adverse Credit history.
Guarantor should be of comparable age, income and net
worth.
Application Fees Application Fee + Taxes to be collected at the time of login.
Cheque This will be non-refundable Fees. – Rs. 3500/- including GST.
Legal and technical fee/expenses payable separately to the
vendors by the borrower.
Credit Bureau Two mandatory Credit Bureau checks will be carried out, of
check which CRIF HIGH MARK is essential. Apart from that one
more check by CIBIL/ Equifax / Experian will be done.
Loan Amount Product Loan Amount
Home Loan 2.0 Lacs – 25.0 Lacs incl.
Insurance
Home Improvement 2.0 Lacs – 25.0 Lacs incl.
Insurance
Self-Construction 2.0 Lacs – 25.0 Lacs incl.
Insurance
Composite (Plot + 2.0 Lacs – 25.0 Lacs incl.
Construction) Insurance. No loan on plot
purchase.
BT & BT + Top-up BT- 2.0 Lacs - 25.0 Lacs
BT+ extension/renovation Top-up: To be restricted
loans max 20% of BT Amount or
Rs.2 Lacs whichever is
lower
For extension/ renovation-
BT loan outstanding plus
80% of new constructions.
Combined LTV 80 % to be
maintained.
Customer seeking BT must
pay minimum 12 EMIs. BT
of PEMI cases can be also
considered if customer is
having guanine reason to
shift is part disbursed loan.
Loan Tenor Product Tenure (In Years) Max
Home Loan 20
Home Improvement 20
Self-Construction 20
Composite (Plot + 20
Construction)
16 | P a g eCredit Policy
BT & BT + Top-up/ BT+ 20
extension/renovation
FOIR - Fixed Fixed Obligation to Income Ratio: In this method, Loan
Obligation Amount Eligibility is determined by considering Fixed Loan
Income Ratio Obligations of the Applicant at the time of applying for the loan.
Method for Loan Fixed Obligations do not include Insurance Premium,
Eligibility Professional Tax, Charity Work.
Calculation
Net Income/NAS per FOIR
month- Rupees
Up to 20000/- 45%
Rs. 20000/- to 30000/- 50 %
30001- 50000 55%
Above 50000 60% - NO DEVIATION
APPLICABLE
New House
Max Loan to 80% of Registered Agreement Value + Stamp Duty +
Value (LTV) Registration fees. Deviation on Market Value of property as
per matrix.
Resale
80% of Fair Market Value or Agreement value whichever is
lower. Deviation on Market Value of property as per matrix.
Extension/ Improvement
80 % of Extension/ Improvement Cost estimated by Certified
Engineers or Technical Valuator whichever is lower.
Self-Construction
80% of Construction Cost validated by Certified Engineer or
100% of Plot Cost or the Product cap whichever is lower.
Balance Transfer
100% of Principal Outstanding subject to existing LTV norms.
Minimum track record of 12 months with the current financier
required.
Special Norms Product/profile cap to be complied
Note: As per NHB guidelines LTV not to exceed (i) 90% for Loans Up to 30 Lacs,
(ii) 80% for loans above Rs.30 Lacsbut upto Rs. 75 lacs and; (iii) above Rs. 75 lacs
not to exceed 75%, Including Loan Shield Insurance. (Ref: NHB Master Circular;
Para No 27-a)
The Loan to Value (LTV) ratio shall be computed as a percentage with total
outstanding in the account (viz. “ principal + accrued interest+ other charges
pertaining to the loan” without any netting) in the numerator and the realizable
value of the residential property mortgaged to the company in the denominator.
The valuation of the property should be done by the empanelled valuer and in
accordance with the valuation policy of the company compiled as per the directions
of National Housing Bank.
17 | P a g eCredit Policy
Validity:
Sanction Letter The Sanction Letter validity will be for 60 Days (If 1st
Disbursement is not availed within 60 days’ time frame, case
will have to be re-appraised as a New case.
Credit Bureau Credit Bureau Report will be valid for 30 days.
Reports Residence and Business / Office Verification, Document
Verification etc. will be valid for 30 Days.
Verification Legal & Technical report will be valid for a period of 60 days.
Reports
Legal and
Technical
Reports
Valuation and Valuation of the Property to be done prior to disbursal, to
validity of determine the Stage of Construction and Market/Realisation
constructions of Value of the Property.
Property Valuation to be done through an approved Valuer of SHFL.
The Valuation Report, amongst other things must contain
Certifications on the following:
That the construction is as per Approved Plans/ licensee
engineer’s plan , and Progress thereon.
Market Rate/Realisable value/DLC of the Property.
Future expected rentals.
Date of Site Visit.
Any FSI deviations and the impact of the same on the
Property to be financed.
For purchase of readymade old house, licensee engineer
building plan is considerable.
If approved plan not available and licensee engineer’s
building plan is available, construction cost would not be
considered while assessing the valuation of the property and
LTV to be maintained on plot/land valuation only. However
on advice of panel technical vendor, valuation of permissible
constructed areas with indemnity bond of customer to
compound the same can be considered.
Certification on the current cost of Construction per sq.ft.
with the amenities suggested in the flat/house/unit.
Legal Clearance Legal Opinion Report from an Empanelled/ Internal Lawyer
certifying Clear & Marketable Title to the Property will be
required prior to disbursal.
Own In Builder Purchase case, Own Contribution Receipts (OCR)
Contribution or Margin Money Receipts(MMR) must be paid by way of
Receipts (OCR) Cheque/ NEFT (Maximum 2 Lacs Cash allowed in entire OCR/
MMR Contribution as per Government guidelines. Cash
18 | P a g eCredit Policy
or Margin Money Declaration and Source of Funds Declaration mandatorily
Receipts (MMR) required in such cases).
In Self-Construction case, customer must invest his OCR/
MMR on upfront basis (Refer Matrix).
Minimum 75% of required MMR/OCR to be paid by way of
Cheque/NEFT
Stages of In Self Construction/ Home Improvement/ Extension cases
Disbursal - disbursal will be as per Stage of Construction and
Disbursement Matrix.
In New Property Purchase case (from Non-APS Builder) –
disbursal will be made subject to minimum of 35% stage of
Construction is complete and as per Disbursement Matrix.
In case of extension of existing property/residential unit ,
advance disbursement (25-35 % of sanctioned loan amount
)can be done on prior approval from head of credit.
Mode of In Builder Purchases cases, Disbursement to be done
Disbursement through Cheque / RTGS.
In Resale cases, Disbursement to be done through Cheque
/ DD.
In Self-Construction/ Home Improvement cases,
disbursement to be done through Cheque/ RTGS.
In Balance Transfer cases, the Outstanding amount to be
paid directly to the HFC / Bank through Account Payee
Cheque/ DD.
In MSME Loan cases, disbursement to be done through
Cheque / RTGS.
Insurance Property to be insured at the time of first disbursement
against fire and earthquake.
Credit Shield Insurance to be mandatory for all cases.
Pre-EMI Interest Pre-EMI Interest is the Interest charged on disbursed
amount for the differential period from date of disbursal to
one month prior to 1st EMI Due date.
For all Under construction/ Self Construction Properties, Pre-
EMI will be applicable till full Disbursement is not availed.
Borrower can opt (against specific request) for repayment of
full EMI post 85% of Disbursement. During the construction
Stage, Borrowers must pay the interest every month on due
date through NACH.
19 | P a g eCredit Policy
Equated Monthly All Individual Loans to be repaid in Equated Monthly
Instalments Instalments (EMI).
(EMI)
Moratorium 1 month from date of disbursement for all cases except in
case of self construction and renovation where the
moratorium period will be decided as per construction period
but not exceeding 12 months.
Repayment Due Common Due date available will be 10th of every month.
Date
Differential 1st Repayment due will mandatorily be Interest for
Period Interest Differential Period.
Mode of EMI NACH / ECS mode of Repayment will be mandatory (ECS
Repayment Mode to be taken where NACH is not applicable and ECS to
be Verified on all copies by the Banker).
The NACH / ECS mandate should be accurately filled as per
format and instructions rolled out from time to time.
Repayment to be provided from Salary Account in case of
Salaried Class and from Main Operative Account in case of
Non-Salaried Class. In Balance Transfer Cases, repayment
should be from the account from where the previous EMI was
repaid from.
Security Cheques 5 Security Cheques required in all NACH / ECS Mode of
Repayment.
Part Payment/ 10% of present outstanding can be paid as Part Payment /
Pre-Payment Pre-Payment, permissible 4 times in year
Target Market Expansion on Board/Management Approval
States/
Branches/
Location
Business Branch Sales Team
Sourcing Direct Enquiry/ Star HFL Marketing Programs/Direct Selling
Channels Agent
Loyalty Marketing Programs
Cross Sell Programs
Customer Referrals
GEO LIMIT For rural housing – Refer rural housing program
For semi urban and urban areas - 100 km from hub location
and 75 km from RR locations.
Rate of Interest Interest rate offered are fixed on SHFL base Rate plus risk
premium according to risk profile of the borrower (Refer Price
Matrix).
Processing Fee Application Fee: Rs.3500/- incl. GST (Non- Refundable)
Legal and technical expenses are payable by borrower to
vendors through in-house team.
Processing Fees: 2% Sanctioned Loan Amount + GST
20 | P a g eCredit Policy
Mode of Fees Application Fees: Thru Cheque from NACH Participant Bank
of EMI repayment Account
Processing fees /Legal/Technical / CERSAI/ NOI: Thru
Demand Draft / Banker cheque only.
Other Charges CERSAI: Rs.250/- for loan amount up to Rs. 5 lakhs
Rs.500/- for loan amount above Rs.5 lakhs
Stamp Duty/Registration: At Actuals + GST
Notice of Intimation (NOI – Applicable in State of
Maharashtra): Rs.3000/-
Legal, Technical& Title Search Fees:Rs. 3000 + GST
PDC / ECS Bounce Charges: Rs.500/- per instance + GST
Delay Payment Charges: 3% per month for the number of
days of delay +GST
Field Visit Charges: Rs.250/- (in case collection is done at
customers place) +GST
Disbursement Cancellation Charges – 4% of principal
outstanding +GST
NACH/ECS Swap fee - Rs.500/ +GST
Statement Request (Duplicate Interest Statement/
Statement of Accounts/Duplicate NOC/ Foreclosure Letter):
Rs.500/- per statement
Retrieval of copy of documents: Rs.500/- +GST
Restructuring/ Switching Fee (Applicable on outstanding
principal amount): 1.00% +GST
Duplicate No dues certificate: Rs.500 /- +GST
Debit Card Swipe Charges: 1% of Swipe Amount + GST
Pre-Closure Charges:
Home Loan: Own Source – Nil
: Loan transfer: 4 % of Principal +GST
Non-Home Loan: 4 % of Principal Outstanding + GST
PRODUCT GUIDELINES –
Product Home Loan (New) Home Loan Self-Construction on
Parameters Resale plot
Purpose Purchase of New Purchase of Resale For Construction on a
Property from Property Semi Built-up
Builder Residential Property
or for construction
from the plinth level
21 | P a g eCredit Policy
Loan Amount 2.0 - 25 Lacs 2.0 - 25 Lacs 2.0 - 25 Lacs
(Rs.)
Tenor Max 20 years Max 20 years Max 20 years
LTV 80% of Direct 80% of Registered 80% of Construction
allotment letter/ Sale Deed or Cost validated by
Registered Sale Deed Agreement to Sale Certified Engineer or
or Agreement to Sale + Stamp Duty + 100% of Plot Cost or
+ Stamp Duty + Registration fees) the Product cap
Registration fees) or or 70% of Fair whichever is lower.
80% of Fair Market Market
Value/Realisable Value/Realisable
value whichever is value whichever
lower. is lower.
Legal Legal Opinion from an Empanelled/ Internal Lawyer certifying a
Clear & Marketable Title to the Property, prior to Disbursal.
Technical Technical opinion from an Empanelled/ Internal Valuator
certifying Current Market Value/Realisable/DLC value of the
Property and stage of Construction.
Security Equitable/ Equitable/ Equitable/ Registered
Registered Mortgage Registered Mortgage to be
to be executed. Mortgage to be executed.
executed.
Completion Properties need to be completed within 12 Month from the first
Period for disbursement date, a written confirmation from customer need to
Self- be taken in all such cases.
Construction
Property
Product Home Improvement/ BT + Top- up MSME Loans
Parameters Extension
Purpose Home Improvement/ Takeover of Loans to Small
Extension of Residential existing Home Entrepreneur’s
Property. Painting Loans from for Working
(Internal & External), approved Capital/
Tiling & Flooring, Grills Financier. BT Loan Expansion/
and Aluminium Works, to be of minimum Other Business
Plumbing & Sanitary 12 months’ vintage Requirements
22 | P a g eCredit Policy
Works, Structural with no instance of
changes, External 30+ DPD in last 12
Repairs, Water months.
proofing, Boundary
Wall Construction, Takeover should be
Bore-Well of the cases which
Construction, are primarily for
Construction of Rate arbitrage or
Underground/ due to service
Overhead Water Tanks, issues with existing
Fitting of Doors and Financiers.
Windows.
Loan Amount 2 - 15 Lakhs 2 - 25 Lakhs 2 - 5 Lakhs
(Rs.) Top-up: Loan
Amount to be
restricted to
Maximum 50% of
Balance Transfer
Amount or Rs.10.00
Lakhs whichever is
lower.
Tenor (Years.) Max 20 years Max 20 years 2 - 5 years
LTV 80% of Extension/ Principal Outstandi 70% of Realisable
Improvement cost ng as per Value.
estimated by Certified Foreclosure
Engineers or Technical Statement or
Valuator whichever is Statement of
lower. Account or 70% of
Property Cost or
Realisable Value
whichever is lower.
Legal Legal Opinion from an Empanelled/ Internal Lawyer certifying
Clear & Marketable Title to the Property will be required prior to
disbursal.
Technical Technical Opinion from an Empanelled/ Internal Valuator
certifying a Marketable Value of the property will be required
prior to disbursal.
Security Equitable/ Registered Equitable/ Equitable,
Mortgage to be Registered Registered
executed. Mortgage to be Mortgage to be
executed. executed.
23 | P a g eCredit Policy
Completion Improvement should be done within 3 months from the date of
period for first disbursement a written confirmation from customer needs to
Home be taken in all such cases.
Improvement
UNDERWRITING STANDARDS –
Credit Criteria Salaried SEP SENP
Professional Employee of Practising Doctors / CA/ Individuals
Qualification Government & CS/ Cost Accountants/ engaged in any
Non- Certified Engineers/ Trade / Business be
Government Architects it Manufacturing /
Organisation, Whole Sell / Retail
Public & Private / Service Provider
Ltd. Companies, etc., with sound
Partnership Financial
Firms & background.
Proprietorship Agriculturist:
Individuals
engaged in
agriculture/ allied
activities
Minimum Rs.1 Lakh (Gross Rs.1 Lakh (Gross Taxable Rs.1 Lakh (Gross
Annual Income)- this Income)- this would be Income)- this
Income (per would be joint joint family income and would be joint
annum) family income for individual minimum family income and
and for monthly income should for individual
individual not be less than be 5000/- minimum monthly
minimum income should not
monthly income be less than be
should not be 5000/-
less than 5000/-
Income Proof DOCUMENTE DOCUMENTED DOCUMENTED
D INCOME-3 INCOME- ITR of last 2 INCOME- ITR of
months’ Salary years along with last 2 years along
Slip and Salary Computation of Income with Computation
reflection in Certified by CA. ITR filed of Income Certified
Bank Statement, in proper 6 months Gap. by CA. ITR filed in
if TDS deducted Business license available proper 6 months
24 | P a g eCredit Policy
Form 16 required. Business Gap. Business
required. running in permanent set license available
up. Average bank balance required. Business
SEMI is sufficient to service the running in
DOCUMENTE regular monthly EMIs. permanent set up.
D INCOME–3 RTR is also available for Average bank
months’ salary supporting to repayment balance is sufficient
certificates of EMIs. Net income is in to service the
required. increasing manner. regular monthly
Salary by cash EMIs. RTR is also
but SEMI DOCUMENTED available for
PF/insurance INCOME – ITRs not supporting to
deducted or if regular/ one year ITR. repayment of EMIs.
TDS deducted Business license available. Net income is in
form no 16 Average bank balance is increasing manner.
available. sufficient to service the sale –purchase bills
regular monthly EMIs. . available. Stock
UNDOCUMEN maintained.
TED INCOME – UNDOCUMENTED Business running
salary by cash. 3 INCOME- ITR not filed. with permanent set
months salary Business license available. up.
certificates. Bank account maintained.
Positive SEMI
verification by DOCUMENTED
credit officer. INCOME – ITRs
not regular/ one
year ITR. Business
license available.
Average bank
balance is sufficient
to service the
regular monthly
EMIs. Sale –
purchase kaccha
bills/register/vouc
hers available.
Business running
with permanent set
up.
UNDOCUMENTE
D INCOME- ITR
25 | P a g eCredit Policy
not filed. Business
license available.
Bank account
maintained. Sale –
purchase kaccha
bills/register/vouc
hers available.
Business running
with permanent/
temporary set up.
Work Minimum 2 Minimum 2 years’ work Minimum 2 years’
Experience years’ work experience in same in same Business
experience Profession
without gap
Residence Minimum 2 Minimum 2 years’ Minimum 2 years’
Stability years’ Residence Residence stability in the Residence stability
stability in the same City & 1 year in the in the same City &
same City & 1 Current Residence. 1 year in the
year in the Current Residence.
Current
Residence.
Mandatory Residence, Employment & Business Premises Verification.
Verifications All Original Income Documents to be verified during Personal
Discussion and Visit.
ADDITIONAL INCOME TO BE CONSIDERED AS PRIMARY INCOME IN ALL
CATEGORIES –
Source of % For Eligibility Docs Required
Income
Agricultural 50% of Agricultural Income. Latest ITR Or Crop
Income Receipts
Existing Rental 100% Net Rental Income Registered Rental
Income (after deduction Tax, Agreement &
Repairs etc.) Bank Credit
verification.
75% of Net Cash Rental Rental Agreement/
Income. Receipts and
26 | P a g eCredit Policy
Confirmation from
50 % of net cash rental Tenants during
income Personal Discussion of
Credit.
Rental agreement not
available but
Confirmation from Tenants
during Personal Discussion
of Credit.
Interest Income 50% of last 3 years Average Reflection of Regular
Credits in the
Bank Statement and TDS
Certificate confirming the
same.
Agricultural 100% of Agricultural Khasra Girdavri/copy of
Income Income. Khata, Milk Diaries, Copies
(Agriculturist) 100% of Allied activities of sales bills of agri
produce.
For agriculture income assessment and consideration please refer rural housing
program.
Income not to be considered in Eligibility Calculation
Capital Gains
Speculative Income
One-time Income / Arrears received
Income from Dowry / Gift
Any income which is not fixed / or only for one time
UNDERWRITING METHODS –
Content Salaried Self Employed
27 | P a g eCredit Policy
Applicability Salaried Formal/ Self Employed Self Employed Non-
semi formal and Professional (SEP) Professional (SENP)
Informal
Net Adjusted After statutory NA NA
Salary Method deductions. Loan
EMIs payable
below 12 months
can be added back
Income NA On Declared Income On Declared Income
Method or assessed income- or assessed income-
which ever lower whichever is lower
Income NA 2 time of Average PAT of 2 years
Multiplier
Method
Net PAT (No NA Average of last 2 years Profit after Tax (PAT)
Multiplier) + Average of last 2 years Depreciation
Method
Gross Margin NA Eligible Income for all cases will be 10% of
Method the Average Gross Turnover or Actual
Average Gross Profit of last 2 years
whichever is lower.
50% of average production of last 2 years in
case of agriculturist.
Gross Receipt NA Eligible Income NA
Method for all cases will
be 100% of
Average Gross
Receipts of last 2
years as reflected
in Profit & Loss
Account.
Depreciation not
to be added back
in to Average
Gross Receipts.
Gross Receipts
must reflect
increasing trend.
28 | P a g eCredit Policy
Banking NA Eligibility would be derived based on
Surrogate availability, quantum and satisfactory
level of Banking habits. Average Bank
Balance for the past 12 Months > 2 times
of EMI (Average Bank Balance to be
calculated on 10th,20th& 30th of every
month.
Bank Account should be at least 1 yr.
old.
OD and CC account will not be
considered.
Max 3 account will be considered for
eligibility.
Repayment NA 18 Months seasoned 3/ 4-Wheeler/ HL/
Track Record MSME Track without DPD.
(RTR) EMI Eligibility: 1.5 times* Existing EMI
Loan should reflect as Closed in
Statement of Account or NOC to be
collected.
Foreclosed Loan should not be more
than 60 days old at the time of login.
No Clubbing of Co-Applicants Income
for eligibility.
LOW LTV For - Self LTV – 35 %
PROGRAM employed FOIR- 65 %
business class and INCOME ASSESMENT NORMS- as
professionals described herein above.
NOTE - Assessment income derived by credit personnel would supersede on declared
income. However the income (assessed or declared) whichever is lower will be taken
into consideration for the purpose of loan eligibility.
INCOME OWNERSHIP MATRIX - CLUBBING OF INCOME
Case I
When Father and/or Mother is/are the Owners of the Property
29 | P a g eCredit Policy
Son’s income can be clubbed with the parent’s income provided either (i) the Son is
the sole child or all other successors of the property owner/s join as Co-Applicant/s
or as Guarantor/s in the Loan Application.
When Father and / or Mother is the owner of the property
Daughter’s income can be clubbed with the parents’ income provided the daughter is
the sole child.
Case II
Joint Ownership with (Father &/or Mother) + Son
Son’s income can be clubbed with the parents’ income provided that either (i) the son
is the sole child or (ii) all other successors of the property owner/s join as Co-
Applicant/s or as Guarantor/s.
Joint Ownership with (Father &/or Mother) + Daughter
Daughter’s income can be clubbed with the parents’ income provided daughter is the
sole child.
Case III
When Son is the Owner
Parents’ income can be clubbed even when Son is not the sole child.
When Daughter is the Owner
o Parents income can be clubbed provided Daughter is the sole child
o To prove sole succession, Affidavit OR Declaration on a requisite Stamp Paper has
to be submitted. Preferably ration card to be obtained.
30 | P a g eCredit Policy
o If the other successor/s join as Co-Applicant/s, Income Proof/ Bank Statement is
not necessary as income will not be considered, however all other formalities
required for a borrower will have to be undertaken.
o If the other successor/s join as Guarantor/s, Income Proof/ Bank Statement will
not be required. However, all other formalities required for Guarantor will have to
be undertaken.
31 | P a g eCredit Policy
Case IV
When Ownership with two Brothers
Income of one brother can be considered. Two brother’s incomes can be clubbed
provided the housing units are separable or property owned jointly by brothers.
When ownership with two Sisters
Income of one sister can be considered. Income of both the sisters can be clubbed
provided the housing units are separable or jointly owned.
When ownership with one Brother and one Sister
o Income of one person can be considered. Income of both brother & sister can be
clubbed provided the housing units are separable.
o To prove separable housing unit, prior inspection report should be submitted.
APPROVED PROJECT SCHEME (APS) - PROCESS AND CRITERIA –
The approval of any Scheme / Project under APPROVED PROJECT SCHEME (APS)
is to facilitate disbursements and avoid repetitive documentation from different
customers for the same Scheme / Project.
Credit appraisal of the customers would be done as per individual appraisal norms.
In case of apartment, property should be 85% complete as per the Technical Report
for it to be considered as Ready Property. If property is less than 85% complete it
should be treated as Under Construction Purchase and APS approval should be
obtained as detailed below. APS is a mechanism through which a specific residential
Builder Project is approved upfront from legal standpoint and technical valuation of
the entire project is conducted at regular intervals.
Selection Criteria The Builder should have an experience of over 5-yrs in the line.
Where-ever proposed Builder/ Developer’s Project is yet to be
approved by any Financier, SHFL can initiate the APS process
and the cost arising out of this to be recovered from Builder.
Legal Mandatory Legal with Clear and Marketable Report.
Assessment of Original Documents to be Verified by the Lawyer.
Project
Original Verification report to be part of the approval process.
32 | P a g eCredit Policy
Valuation Report Mandatory at the time of approval.
of the Project
Mandatory Agreement to Sell, NOC from Developer, Own Contribution
Mortgage Receipts, NOC from Financier (in case of Project Finance cases),
Documents
Demand Letter,
Some locations have practice of upfront Registration of UDS, in
those locations registration to be mandatory as per legal advice.
Approving Internal Legal Team/ Legal Office to initiate Mail with all the
Authority details / Builder Information Report (BIR) as per format, and
seek approval from CEO.
Project Valuation Quarterly Project Valuation to be done to monitor Progress of
Construction, Price trend for the project from internal team to
be kept on records
CIBIL CIBIL Verification of all Partners/ Directors/ Owners, to be
Verification done mandatorily.
Deemed Project If the project is approval from the bellow mentioned HFC/ Banks
Approval will be considered for APS
HDFC Bank Citi Bank
ICICI Bank /ICIC Home Finance LIC Housing Finance
SBI Bank Can Fin Homes Limited
DHFL Can Bank Home Finance Ltd
Gruh Finance PNB Housing Finance
Corporation Bank L&T Housing Finance
Tata Capital Housing Finance Axis Bank
HDFC Ltd.
PRODUCT MIX AND PRICING MATRIX -
PRODUCT MIX CONCEPT FOR STAR HFC - Housing finance companies are facing
tough competition due to the inclination of mainstream HFCs and banks towards the
affordable housing segment and funding at a lower rate by taking business calls on
income and property parameters HFCS recently received COR are also intended to
focus on the affordable housing segment due to high returns. We at STAR want to
create a quality portfolio at a weighted ROI of 16 % and also to have a presence in the
builder's and high income net worth segments and thus we need to have product mix
with multiple lines with pricing mix concepts.
33 | P a g eCredit Policy
Product mix, also known as product assortment, refers to the total number of product
lines a company offers to its customers. We being HFC, Pricing is a critical element for
us and we must need to have a pricing mix as well.
Being HFC , our product mix is the most important part of developing our marketing
strategy. In the current competitive scenario of the housing finance market it is
essential for us to have multiple products for the targeted affordable housing segment.
Selling a variety of financial products helps us increase our sales and profit potential
and would reduce our dependency on a conservative housing product and policy.
DIFFERENTIATING BRAND - In addition to factors like multiple options for selling
home loans products, enhancing staff productivity, one stop home loans products,
product mix is essentially for mass marketing and our brand identity. It is, after all,
why customers shop with us. In classic marketing theory, a key business success is
having a unique selling point or proposition (USP). What’s different about our brand
that customers can’t find elsewhere – a product, service and experience that makes
them choose our products y over our competitors and keeps them to refer to others.
PRICING MATRIX - Suggested pricing mix is ranging between 14 % to 24 % and
weighted average ROI to be maintained minimum 16 percent.
LOWER ROI RANGING 14-15 % suggested only for builder's tie up and documented
income customers.
HIGH ROI RANGING 16-17.50 % suggested for semi urban and urban properties-
currently we are doing it
HIGH ROI RANGING 18-24 % (to be offered basis on documented and
undocumented income profiles and consideration of agriculture income) suggested
for rural housing properties. Rajasthan, MP, Gujarat, and TL are potential markets for
rural housing finance at higher ROIs.
HOW TO MAINTAIN WEIGHTED AVERAGE ROI OF 16 % - Branches need to
funding at least 30 % of monthly disbursement portfolio at higher ROI 18-24 % and
30 % at 16-17.50 % and 40 % at 14-15 % as to maintain average weighted ROI of 16 %.
However branches are having free hands to maintain weighted average of ROI above
16 percent if they want to be focused more on rural housing finance.
34 | P a g eCredit Policy
PRODUCT MIX - WEIGHTED AVERAGE ROI TO BE MAINTAINED AT 16 %
SN PRODUCTS POLICY ROI REMARKS
1 Rural Housing- Credit HL ROIs– 18-24 % Please refer rural
properties situated underwriting ROI to be charged housing product
at gram Panchayat norms as per based on income
areas existing credit profile and
policy. deviations to be
Special taken on income and
provisions to property aspects.
be complied
2 Urban and semi Credit HL ROIs- 16- 17.50 We are currently funding
urban Housing ( underwriting % in this customer’s
Normal Product )- norms as per ROI to be charged segment- Refer pricing
properties situated existing credit based on income grid
in city and policy. profile and
outskirts areas deviations to be
taken.
3 Builder’s Tie ups Credit HL ROIs- 14-15 % Builder’s projects
Individual Buyers underwriting ROI to be charged would be
norms as per based on income recommended by
existing credit profile and Regional heads and ROI
policy. deviations to be tie up would be
taken. approved by MD- refer
pricing grid
4 High income Credit HL ROIs- 14 -15 % Minimum monthly
group customers underwriting ROI to be charged income 25k and only
norms as per based on income documented income to
existing profile and be considered. Refer
policy- deviations to be pricing grid
minimum taken.
monthly
income Rs. 25
k plus
NOTE – for maintaining weighted average of 16 % branches need to first create high
ROIs portfolio and then move for lower ROIs. Regional heads are required to watch
35 | P a g eCredit Policy
on weighted average ROIs on monthly basis and they are responsible and accountable
for marinating weighted average.
PRICING GRID FOR SEMI URBAN AND URBAN CUSTOMERS- SALARIED
CUSTOMER INCOME TYPE INCOME ROI AND
PROFILE RANGE –PM LOAN CAP
SALARIED DOCUMENTED – BY UP TO 25000/- 15 %
CHEQUE/RTGS/
PF/INSURANCE/FORM
16 AVAILABLE ABOVE 25000/- 14 %
SEMI DOCUMENTED- UP TO 25000/- 16 %
SALARY IN CASH BUT
PF/INSURANCE
DEDUCTED AND OR
FORM NO 16 AVAILABLE ABOVE 25000/- 15 % LOAN CAP
20 LACS
UNDOCUMENTED- CASH UP TO 20000/- 17-18 %
SALARIED- PROOF
AVAILABLE TO VERIFY LOAN CAP 10
LACS
JOINT INCOME COMBINATION OF UP TO 25000/- 15 %
FORMAL AND SEMI ABOVE 25000/-
FORMAL/ INFORMAL 16 %
INCOME
LOAN CAP 15
LACS
PRICING GRID FOR SEMI URBAN AND URBAN CUSTOMERS- SENP
CUSTOMER INCOME TYPE INCOME ROI AND LOAN
PROFILE RANGE –PM CAP
SENP DOCUMENTED – UP TO 35000/- 15 %
REGULAR 2 YEARS ITR
ABOVE 35000/- 14 %
SEMI DOCUMENTED- UP TO 35000/- 16 %
ONE YEAR ITR OR
IRREGULAR ITRs FILED
36 | P a g eCredit Policy
ABOVE 35000/- 15 % LOAN CAP
20 LACS
UNDOCUMENTED- NON UP TO 30000/- 17- 18 %
ITR MAXIMUM
LOAN CAP IS 10
LACS
JOINT INCOME FORMAL AND SEMI UP TO 50000/- 16 % LOAN CAP
FORMAL OR INFORMAL 20 LACS
PRICING GRID FOR SEMI URBAN AND URBAN CUSTOMERS- SENP/SEP
CUSTOMER INCOME TYPE INCOME ROI
PROFILE RANGE –PM
SEP DOCUMENTED – UP TO 35000/- 15 %
REGULAR 2 YEARS ITR
WITH 6 MONTHS GAP
ABOVE 35000/- 14 %
SEMI DOCUMENTED- UP TO 35000/- 16 %
ONE YEAR ITR OR
IRREGULAR ITRs FILED
ABOVE 35000/- 15 % LOAN CAP
20 LACS
UNDOCUMENTED- NON UP TO 30000/- 17 % LOAN CAP
ITR 10 LACS
JOINT INCOME FORMAL AND SEMI UP TO 50000/- 16 % LOAN CAP
FORMAL OR INFORMAL 20 LACS
PROGRAM - FUNDING FOR CUSTOMERS HAVING PROPERTIES IN RURAL
AREAS.
BACKGROUND - The shortage of housing across the country is being increasing
every year. Housing Shortage Will Increase to 70 Million by Year 2020. We need
around 40 million houses in rural areas only. 47 % existing houses in rural areas are
having Kaccha roofs and 90 % houses are toilet less. The gap of demand and supply
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