AN EMPIRICAL STUDY OF REFINANCING (BALANCE TRANSFER) OF HOME LOANS
Abstract
The Indian real estate market went through a sea change in the year 2018. Various shades of the domestic market came on surface. Certain geographic pockets witnessed a dip in terms of property valuation and sales volume, while other pockets witnessed property price appreciation and sharp growth. Impact of landmark regulatory policies such as RERA, GST and the Benami Transactions Prohibition Act along with demonetisation also changed the real estate landscape. ‘Affordable Housing’ was the buzzword for the real estate industry from 2018 onwards, courtesy government’s schemes like Pradhan Mantri Awas Yojana (PMAY).The supply-demand scenario was expected to improve and unsold inventory levels were likely to decline further. Affordable housing was expected to drive supply and demand, backed by several government reforms. The study is an in-depth study about the balance transfer facilities offered by the financial institutions. The study was undertaken to understand the increasing competition among housing finance institutions to emerge as a successful lender of housing finance. With the market being customer sensitive, it is important for Housing Finance Companies (HFC’s) to serve their customers as per their needs and refrain them from transferring their home loan to another financial institution. However, with HFC’s offering attractive benefits to persuade customers to transfer their home loan, it is crucial for HFC’s to understand the reasons for which customers are willing to transfer their home loans and thereby suggesting the areas of improvement for HFC’s.The study provides an in-depth understanding about the balance transfer facilities offered by financial institutions and identifies the reasons for which borrowers transfer their existing home loan from one financial institution to another. Customer satisfaction level with the services of the financial institution after the home loan is transferred has also been studied. The study revealed that rate of interest and customer services were the two most important reasons for balance transfer of home loans.
References
Garg, S. K., & Kumar, G. (2014, October). Housing Finance in India: A comparative study of public and private sector banks. Journal of Commerce and Trade, IX(2).
Geete, V., & Thakur, A. (2014). A comparative study of home loan scheme of private sector bank and public sector bank (with special reference to SBI and HDFC). International Journal of Research in Management and Social Science, 2(2), 12-21.
Gupta, V., & Sinha, R. (2015). A comparative study on factors affecting consumer is buying behaviour towards home loans (with special reference to State Bank of India and Life Insurance Corporation Allahabad). IOSR-Journal of Business and Management, 17(2), 13-17.
Kumar, A. (2016, April). Growth and impact of Housing Finance on Indian Economy: A review. International Journal of Research in Management Science and Technology, 4(1), 58-64.
Nallathiga, R. (2008, September). Affordable housing in cities: The need of the hour. Professional Banker, XI(12), 21-24.
Patnaik, B. C., & Satpathy, I. (2017, August). Home Loans - A conceptual framework. Journal of Advance Management Research, 5(3), 68-75.
Pushpalatha. (2007, May 1). A comparative study on economies of owning a flat house and a single house: A micro study. Southern Economist, 46(1), 50-52.
Tiwana, J., & Singh, J. (2012). Regulatory framework for housing finance companies in India. VSRD International Journal of Business Management and Research, 2(9), 488-495.
