The sector of housing finance in India has increased substantially in the past few years. This business contributes 6% to our GDP. As the cities are full of opportunities, more people migrate to metropolitans every year and they try to find their own little addresses.Increase in numbers of nuclear family is causing the latest demand for affordable housing to rise due to the emergence of new customers. Our national capital Delhi itself has seen an increase of 2 million people in the past 8 years. Our economic capital Mumbai too has seen an increase of 3 million in population.Going to housing finance companies turned has been a popular option to get a house for last 20-25 years as the houses have become unaffordable. While the earlier generations believed in buying a house from their savings, currently almost all of the houses that are bought are financed.
According to Domestic rating agency ICRA, the affordable housing segment has a big possibility to grow over 30% over the medium term and to become the key growth driver for the mortgage finance market as well. Though post demonetization, the delinquencies in the affordable housing and self-employed segments has seen an increase, from 1.07% on September 2016 to 1.25%, still this sector is slated to grow 35-40% year on year at least for the next 5-7 years.
The penetration of Housing finance in India is hovering around 9% which is considerably low as compared with that of the developed countries. However due to potential of affordable housing coupled with Government’s policy push which is attracting, both, the suppliers of housing and housing finance in India is expected to cross 20% in 3-5 years.While the Housing Finance in India is growing at a CAGR of 18% in the last 5 years, the Affordable Housing finance is growing at a CAGR of 40%. The growth rate in Affordable Housing Finance is impressive even if one considers the small base.
The affordable housing business and its possibility is realized by investors as well as housing developers. Many Finance Institutions exist and cater to this segment while all the other banks / HFCs have opened their branches for this segment. While Developers have realized the huge demand that translates into quick business for them. Companies have also realized the benefit of tax sops & infra-status providing the affordable housing by the Government of India.
Earlier, there were a handful of companies existing in this business but as the idea of home loan became the easiest solution to the people, more companies came into the foray. Now there are about 90 companies in this business. In the region of Delhi NCR, there are finance companies like IFL Housing Finance Ltd, DHFL, Shubham and Artfc, who are widening their reach and making the connection strong across the country.
IFL Housing Finance Limited
“IFL Housing Finance Limited” is a closely held limited company, established in 2015 with the objective of doing business of Affordable Housing Finance. IFL Housing Finance Limited is a wholly subsidiary of India Finsec Limited (IFL). India Finsec Limited is a registered NBFC in business of funding of Loan against property & unsecured Loans primarily in Delhi NCR. IFL is BSE listed company having an experience of years in insurance and investment banking.National Housing Bank approved, IFL Housing Finance Ltd is amongst the first organizations in India to claim disbursal in 3 days. IFL Housing wishes to reach out to the lower part of the society, those who are in Low Income Groups, EWS category & people with informal income to fulfill their dream of having a home for themselves, in a hassle-free, simple, speedy & transparent process. Their goal is to spread across all the states of this country and to serve each and every family needing their help to get their own house. IFL offers from home loans to top up loans and against the property loans to the customers. With the loan amount starting from 8 lakhs to 25 lakhs they continue to serve the community.
Shubham Housing Development Financial company
Shubham housing a is a company based on Gurugram, Haryana who claims that they are amongst the first organizations in India to transcend from document-based underwriting to customized credit programs for each customer and have become a leading home loan provider.With the sole purpose of offering customized and affordable housing finance solutions, they believe that everyone deserves a better and safer home to call their own. They have their offices in 84 cities of 12 states across the country with a number of 1000 employs working for them. Subham’shome loan plans vary from 1 lakh to 20 lakhs with an interest of 17 % to the customers aged from 21 to 65 years lasting with a tenure of 20 years. Not only they provide house loans, they also provide housing improvement plans for those in need.
DHFL (Dewan Housing Finance Ltd)
Dewan Housing finance limited was established in 1984 to open the idea of affordable housing finance to the population having lower and medium income in semi-urban and rural parts of India. DHFL is the second housing finance Company that was established in this country.The Company claims to have provided the opportunity to hundreds of thousands of people to make the upward journey by simplifying financial solutions and introducing them to home loan products, insurance services and unique fixed deposit schemes according to their needs.Based in India’s commercial capital Mumbai, DHFL strives to reach its customers through its massive network of 348 offices spread across the country. They provide a range of home loans, home construction loans, plot loan, NRI home loans and transfer Loans against Properties. Their policies of home loans last up-to tenure of 35 years and with an interest of minimum 8.35%. To this company, one has the possibility to take a loan from 1 lac to 300 lacs.
ART Affordable Housing Finance (India) Limited (AAHF)
ART Affordable Housing Finance is a housing company registered under the National Housing Bank. This company provides long-term housing loans to customers belonging to the Low Income Groups and middle income group of the population in peripherals of urban India and semi-urban India.AAHF offers a series of innovative and flexible home loans to enable purchase, construction, extension and renovation of houses with a focus on affordable segment. The company also provides Loan against Property, commercial property, with a clear focus under privileged section of the society. They haveloan tenure up to 20 years with amount starting from Rs. 3 Lacs to Rs. 50 Lacs.
AVIOM India housing finance limited
AVIOM India is an Affordable Housing Finance company providing families in mostly semi urban areas in realizing their dream of owning their home. They provide financial assistance for home buying, home improvement, extension and construction to families from semi-formal, informal sectors and with low income to medium income. AVIOM provides home loan without any income documents. They offer a loan of Rs. 3 lacs to 15 lacs to families with tenure of 15 to 20 years.
Basic eligibility criteria to apply for an home loan
Basic eligibility criteria to to apply for a home loan is explained below:
- Borrower should have a bank account
- Borrower should be an Indian Resident
- From 21 up-to 65 years of age at loan maturity
- Salaried and self-employed segments
- Formal and Informal Income Segments
- Eligibility is dependent on applicant’s income and repaying capacity, age, employment/business vintage, assets and liabilities, cost of the proposed property
You build your own house only once in your lifetime and If you are thinking about taking home loans in the housing finance segment of this country; so many big names appear on your mind. You may want to check all the companies those who serve different communities and different income groups. While you choose, you should keep your demands on the table and scrutinize all the companies and step forward to build your own house of dreams.