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2 Alternative House Financing Payment Plans You May Want to Consider

Gurugram: As Gurgaon has become one of the top areas in India in terms of financial and industrial growth, its lucrative economy makes it a wise choice for a newcomer to the country or for any locals who want to have a taste of what one of the finest cities has to offer. This is made even more attractive due to builders in Gurgaon like Unitech who have constructed self-sustaining communities within the area, meaning easy access to facilities such as schools, hospitals, and even retail services. But before you invest all of your life savings into a single piece of property, you might want to look into other options you can try when it comes to financing your new home. Let us take a good luck at some examples in this article, as well as why you may want to consider them.


Construction-Linked Plan

Most building companies offer construction-linked payment schemes, wherein you are only expected to place a small deposit of anywhere from five to ten percent, another small amount within three months, and then one slightly bigger deposit by the six months’ mark. These amounts can be anywhere from five to ten percent for the first two payments, and twenty percent for the last one. The remaining amount of money is only paid out to the builder once they have reached certain goals that you have both agreed upon.

By choosing this type of plan, you will be able to protect yourself from any excessive delays on your project, since the builders will not get any more money until they finish the next part of their agreement with you. In the unfortunate case that you may not have seen much progress, then you will have only shelled out a small amount of money instead of the total sum, as most people do when they choose to take advantage of a home loan.

Subvention Plan

Most of the time, subvention plans require you to place a 30 percent deposit, and then take out a loan for the remaining 70 percent. As construction on the house goes on, the builder is then responsible for paying the interest on the loan back to the bank. The bank then gives the builder the funds required as more work is done on the house.  This is ideally done to give the builder an incentive to not allow the project to get delayed.

This is an advantageous financial scheme for people who do not currently have possession of a large amount of extra money. It is also good for those who are currently renting a different property, as they will not have to pay for the monthly interest on the house while it is still in the process of being built. However, there are also possible roadblocks you may run into by choosing this option. Since the loan is usually under your own name, your credit score may be damaged if the developers somehow do not make their monthly interest payments on time.

Pick the Plan That Works for You

There is usually no single method that fits everybody’s needs, so it is important to analyze exactly what your current financial status is, how much you can afford to spend every month, and what types of risks you are willing to take. These are but a few of the factors that you should help you make a final choice in terms of how to budget for your potential new residence. Regardless of which financial option you decide to go for, you will surely be more than satisfied with the location you have chosen.