May 04, 2006 01:08 PM
8987 Views
(Updated May 04, 2006 01:24 PM)
This review is written after speaking, calling, interacting and preliminary dealing with ICICI Home Finance, Standard Chartered Bank, ABN Amro Bank, IDBI Bank - Home Loans and HDFC Bank. In some cases, you get a personalised response, in others, they just take your number and never bother to call back.
Firstly, do your own research and ascertain who you deal with from the lending bank. Never proceed on the basis of a builder's contact or referral when approaching a bank for a housing loan. In most cases, the sales representative is too junior a person to answer queries properly or be able to commit to your specific requirement.
The topics/questions I normally cover when speaking to the representatives include:
1. Volume of business the institution does in a year: Remember, it is the VOLUME, not the value. I want to be able to choose a institution who are not desperate or hungry for business that they will just about promise you anything to get you to sign on the dotted line and then dump you. At the same time, do not go to an institution whose volumes are so low that the housing finance departments are shortstaffed as the business does not justify it.
2. Amount of loans and limits and how they are calculated i.e. with reference to property value, market value, agreement value, etc
3. Interest rate mechanism i.e. fixed or floating and how they move in line with rate changes announced by the RBI
4. Security - What documentation is required and how is it safeguarded. This is very important because you do not want to repay your loan and have to wait for 6-8 months before your original property deeds are returned to you(this has actually happened to three couples I know who had all taken their loans from ICICI Housing Finance, one kid almost turned bald, no jokes!). Ask how the institution keeps your documents under safekeeping properly and not lose them.
5. Repayment ahead of turn - What are the charges? How can you repay? When and where can you repay? Are there any hidden costs for advance payments? so on and so forth.
6. Relationship of the institution with the builder - This is critical, especially if you need some paperwork completed quickly and sent back and forth between builder - lending institution. Always ask whether the builder/seller is empanelled with the bank and whom you will contact in case of an emergency. More often than not, we need an NOC or some such thing and a good relationship always helps.
7. Customer service - The person who meets with you and explains your questions, spends time to take you through the process, this is a literal handholding issue and can take almost 1-2 months in some cases. They should walk you though the entire process, be upfront on what they can or cannot do or agree to and most importantly the person dealing with you never raises the expectation bar unnaturally. Friends, this is a very personal issue and the more you deal with people and sales representatives, you will understand what I am talking about.
8. After sales service - Critical, you want to be informed properly of any interest rate changes, any policy changes that affect your loan midway, you need a helpline to call and be attended to properly, most importantly, you need a case officer who you can call. People speak to me about efficient call center personnel but I can assure you that they are few and far between.
These are the main issues that I evaluate. I also make it a point to speak to at least 5-10 people who have take home loans recently(in the preceding 6 months or so) and evaluate their experiences
Based on all this, my own experience with the above banks/lenders has been this:
The websites of all the banks I dealt with are informative and very useful, 90-100% marks for them. It gets tricky when you call them and want to start the negotiation process.
Standard Chartered Bank - Very courteous but take too much time in responding. Also, what they tell you and the fine print differs.
ABN Amro Bank - Took my numbers, never bothered to call back.
ICICI Home Finance - Bad on almost all counts. They send 2-3 different sets of people after your business, each one claiming to be able to get you the best deal and they make all sorts of tall claims. In effect, you have people from the same company competing amongst themselves. Also beware of paying them the processing fees, they actually encashed the processing fee cheque without my permission and I had to fight them tooth and nail to get them to return my money. Its not the Rs. 5, 510 they charged, its the principle of making a buck and then bullying a customer into accepting that they are right. These guys are hungry for business and will take you so far down the path, you will be under pressure to sign and not even look at another bank who could have dome something better for you.
HDFC Bank - Took my numbers, never bothered to call back; but look at the way their parent entity responded.
HDFC Limited – This is like saving the best review for last. I think this organisation excelled in all counts. Right from the day I went to their website at https://hdfc.com. The website is very informative and easy to navigate. I called their Home Line and left my contact information. I then received a call from a single person(my case officer) who hand held me all the way through signing the documents and beyond. All questions answered professionally and courteously. Time lines that were given were adhered to and all promised made honoured. BEST OF ALL, no calling an Interactive Voice Recognition service or a call center to find out where you stand. I think the service could not get more personalised. As an example, the case officer I am dealing with is proceeding on maternity leave. She is in the process of introducing me to her colleague who will be a one stop contact for all my queries. I asked around and am informed that their security and efficiency of process is very good.
So you have it, my not so small review on taking a housing loan and my experiences. Hope this is helpful to you. Good luck in your search for a dream home!
