Different Plans Available While Purchasing A Property

With the increasing competition in real estate sector and decreasing sales to attract customer and meet their requirements, many developers are introducing various offers and discounts to lure the buyers. Many developers tend to give attractive bundled plans rather reducing the prices of apartments. All methods of attractive payment plans are given to the customers to attract them to purchase and make the deal more profitable.

This payment option is beneficial for the end user but it’s necessary for us to understand the outflow under such plans so let’s understand these plans in details:
 
80:20 subvention scheme
Subvention Scheme is a new form of bank financing for home loans. According to this scheme, after an individual applies for a loan for a property under construction, the concerned person need not pay any Pre- EMIs till fixed period that means all the interest till fixed period or possession will be paid by the developer. Under the subvention scheme, the banks or financial institutes disburse 80 percent of the value of the property to the company and instead of passing the Payment discount to the customer the Company pays the PRE EMI component to the bank on behalf of the customer for the specific period as per the subvention scheme plan. The loan is sanctioned or disbursed by the bank based on the eligibility of the customer to service the loan.

10:80:10 subvention scheme
In 10:80:10 subvention scheme here  buyer has to pay  just 10 percent of the property value of a home at the time  of  booking,  and  80  per cent  home  loan will  be taken care by the bank 10  per cent the  customer  will  pay at  the  time  of possession. It’s very similar to 80:20 subvention scheme just the breakup of the amount to be paid is different. Subvention schemes are now been taken by a lesser number of banks and are hugely replaced by conventional construction linked plan.

Construction linked plan
Under the Construction Linked Payment Plan’, the bank disburses instalments to the developer on your behalf for pre-decided construction slab. Every time as there is progress in the project, the bank will release some percentage of the loan amount. These Construction-linked payment plans are planned and made in such a format that by the time of the last slab is laid, 95 percent of the unit’s price has been collected by the developer. The remaining 5 percent is demanded from the buyer when the developer offers possession of the unit. Only after the handover, the buyer will begin repaying the loan to the bank. His first EMI starts right after possession.
 
Possession linked plan
Under the possession linked plan method payment is made in two stages. While 20-25 percent of the total cost is paid at the time of booking, the balance is paid after the buyer receives the possession of the property. The biggest advantage of this plan is it reduces the development risk-the risk that the project may be delayed or not have the ability to get developed at all for the buyer. Since the buyer has paid only 20-25 percent of the total cost, he has lesser money at stake. Thereafter, you get two-three years the time it takes to develop the project to accumulate more money.
 
Real estate systematic investment plan [SIP]
A Systematic Investment Plan or SIP is a smart and hassle-free mode for investing money in housing property. In this method developer at beginning of the year take a lump sum amount from the customer and rest is converted into equal monthly instalments similar to the SIP which allows you to invest a certain pre-determined amount at a regular interval. A SIP is a planned approach towards investments and easy on the pockets of the buyer as the amounts are in the form of small instalments. Such plan is usually used to purchase a property in the range of Rs 60-80 lakhs.
 
Standard – deferred payment plan
In this plan, the buyer needs to pay comparatively higher booking amount as compared to subvention plan. Booking amount is around 30 percent and for the remaining amount, the buyer gets a loan at a later date. This plan has two important advantage one is you could choose a bank of your choice and second being there is always an exit option at any point of time as the amount has to be paid at the time of possession. As a good part of the amount is paid initially so it’s easy to get a loan at the convenient time of 2 to 3 years when it’s closer to the project completion.
 
Additional benefits given by the developer
Just to attract more customers and make the deal more exciting developers provide with additional discount and freebies. Usually, the discount ranges from 8 percent to 18 percent. The developers also give special inaugural offer festive discounts for the early bookings, waiver for floor rise charges, registration charges; stamp duty charges etc. The developer may also provide an electrical appliance, car, gold coins, fitted kitchens etc.