Which option is better Down payment or Construction link plan for home loan?
Down payment or Construction link?
Which option is better Down payment or Construction link plan for home loan?
It depends - if you go for a Down payment plan, builders generally give a discount ranging from 10-15% on the base price (that is a plus point here but then your EMI starts from day one and if there is a delay inconstruction, you tend to end up giving more interest). However if you opt for a CL plan, one gets to have that flexibilty in making payment to the builder as and when he demands. For example if there is a delay in construction from the builder, the demand for next installment would be extended from his side, So this factor gives that extra cusion. I would suggest you make full calculations on both the pricing for full term period of your loan and then decide.
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I am speaking from experience and my own personal views above - I am not an advisor, nor an expert.
now-a-days, when most of the builders are running way behind their schedules
Originally Posted by mintz
If possible, go for a fully-constructed flat or near to completion flat. It will cost more to your pocket, but you can be assured that WHAT-YOU-SEE-IS-WHAT-YOU-GET. Now a days, most builders alter the building plan along the way of their construction without informing the buyers, and chasing the builders is not a easy job given the monetary and political might they have. Most of the builders ( even big one's) are cuming up with pre-excavation plans and their date of project completion is mostly 24 months . In the time of recession, blocking the hard-earned money with them for 24 months carries a huge risk. I believe tht the cost of the flats will come down in the coming months and you can stuck a better deal with the builders ( BIG no no to Middle-men) if u can hold on for some time. Reality bubble has burst and the effects are started to trickle down. Having a hard bargaining attitude will surely help.
* SAFE
Self Appointed Financial Expert
In current senario when the due to recession builders are not able to complete the projects on time go for Construction link plan.
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