Promoted by the Shriram City Union Finance Limited, the Shriram Housing Finance Company Limited is registered with the National Housing Bank. The company has been in the market since December 2011 and provides finance to individuals for housing purposes. The shares in the company to the tune of 77.25% are held by their promoters Shriram City Union Finance Limited and the remaining 22.75% are held by Valiant Mauritius Partners FDI Limited.
The products offered by Shriram Housing Finance Company Limited purely deal with one or the other aspect of housing finance since that is the core operating sector of the company. Three types of housing finance products are provided by the financial institution which is as follows:
- Home Loan
- Loan against Property
- Project Finance
This loan is provided to individuals who are Indian residents and are salaried or self-employed earning a steady source of income for various housing purposes which can be –
- Purchase – this means purchase of a new or a pre-owned house. The maximum amount which the company grants as loan is Rs.75 lakhs while the minimum amount is Rs.1 lakh.
- Purchase of plot and construction thereon – If the purpose of utilizing the loan is purchase of a residential plot and construction of a new house on the same plot of land, loan is provided up to a maximum of Rs.50 lakhs which reflects 80% of the cost of plot including construction of the house.
- Construction –Individuals availing loan only for construction purposes on a plot of land pre-owned by them can also avail of this loan. In this case, 80% of the construction cost subject to a maximum of Rs.75 lakhs will be granted as loan.
- Extension – any sort of extension carried out on an existing residence is funded in this section. 70% of the property value subject to a maximum of Rs.25 lakhs is available as loan
- Balance transfer with or without additional finance – any existing home loan can be transferred to the company and additional finance can be sought if required up to a maximum limit of Rs.75 lakhs
- Renovation and Repair – loans for any sort of refurbishing or repairs carried out on an existing home comes under this category which limits the quantum of loan to Rs.25 lakhs.
All home loans, taken for whatever purpose, may vary in their quantum, but the repayment period is same and is up to 20 years. Moreover, a floating rate of interest of 15% is charged for all the above instances
Loan against Property
A mortgage loan which is taken pledging a residential or commercial property with the bank. Here also there are three variants which are:
- Loan against Residential Property – this loan is granted against the mortgage of a residential property for personal or business financing. The maximum tenure of the loan is 12 years and the quantum ranges from Rs.1 lakh to Rs.150 lakhs.
- Loan against Commercial Property – this loan can be availed against any commercial property with the same tenure of up to 12 years and the same range of Rs.1 lakh to Rs.150 lakhs
- Purchase of Commercial Property – this loan allows an individual to buy a completely constructed commercial property for his business use. The maximum tenure is extended to 15 years and the range is similar as in the above two cases, i.e. Rs.1 lakh to Rs.150 lakhs.
In all the above cases of loans against property, a salaried or a self-employed person who has completed 21 years of age is eligible to avail the loan and a floating rate of 15% is charged on every loan.
The USP of Shriram Housing Finance Company Limited
The company boasts of several benefits which are provided in the interest of the borrowers. These benefits include:
- Complete transparency and no hidden charges on loans
- A network spread all over the country in 16 states and 1 Union Territory
- No penalty is charged if the customer makes any part-prepayment on the loan or there is pre-closure of the loan by completing the EMI payments early.
- They have flexible schemes which cater to the requirements of the informal sector of salaried or self-employed businessmen where the income proof of self-employed individuals is not required
- Existing loans affected from other banks or financial institutions can be transferred to the company whereupon the company also provides the facility of additional financing in case it is required for any business or personal use.
- The company has a tie-up with third party insurance companies who provide insurance which covers the property risk and also the mortality risk of the borrower protecting the outstanding loan from any contingencies.
The online facility of making transactions is used by the Shriram Housing Finance Company Limited in accordance to the directions of the National Housing Bank. Customers and applicants can make payments online via their computers from anywhere without having to locate and visit the branch of the company personally. Moreover, these online payments also generate an e-receipt which becomes a proof of payments made. Thus, making transactions online is secured without any chances of fraud and are also recognized by the company.
Customers who wish to apply for a housing loan but are unaware of the monthly instalments required to be paid against their borrowing can now easily make use of the company’s EMI calculator to know of the same. This facility enables potential borrowers to know their EMIs before they apply making the loan transparent. An individual would simply have to provide the loan quantum sought the tenure within which the loan is expected to be paid and the corresponding interest rate of the loan to get the monthly instalments calculated instantly.