Home Loans vs Personal Funds

There are payment options for the property purchase, one to make the entire payment paid in advance, at the time of the booking. For that, you need to have much cash available. The other pertains to the safety of the capital, until the reputation of the seller is reliable.

Advantage in the first case is that the purchaser is relieved of keeping track of payments and ensuring that the installments are not missed, another being the upfront discount usually given by builders. The payment for purchase of property can also be made in installments.

In case the purchaser is taking a housing loan, such installments are paid by the bank directly to the builder.
Most builders keep payment schedule on a time basis. The purchaser is required to make a payment at the time of booking of the apartment, ranging from 10-25% of the cost of the apartment, and the balance amount is spread over a period of time. The final payment is to be made before the handing over of possession, to the purchaser.
Some builders also give the option to link the payment schedule with the pace of the construction work, including an upfront payment at the time of booking, followed by installments depending on the stage of construction completed.
A purchaser needs to plan and track the payments  and also, in case one has opted for a loan, he has to pay interest on a higher amount and for a longer duration. All these costs are normally payable with the last installment, once the apartment is ready for occupation, and just before the possession is handed over.
Generally, stamp duty and registration charges are payable along with the last installment and the recovery of the EMI starts only after disbursement of the entire loan amount.

Post a Comment

You must be logged in to post a comment.