{"id":8582,"date":"2022-11-18T13:21:12","date_gmt":"2022-11-18T13:21:12","guid":{"rendered":"https:\/\/www.homebazaar.com\/knowledge\/?p=8582"},"modified":"2025-01-02T10:53:17","modified_gmt":"2025-01-02T10:53:17","slug":"construction-linked-payment-plan","status":"publish","type":"post","link":"https:\/\/www.homebazaar.com\/knowledge\/construction-linked-payment-plan\/","title":{"rendered":"What Are Construction-Linked Payment Plans? What Can Be The Best Plan For You?"},"content":{"rendered":"

What are<\/b> Construction-Linked Payment Plans?<\/b><\/h2>\n

The construction-linked payment plan is a flex payment method which brings together buyers, builders, and financial institutions so that each party may make the arrangement into a successful business transaction.\u00a0<\/span><\/p>\n

\"Construction-Linked<\/p>\n

In this payment method, the money is paid to the builder by bank institutions on behalf of the homebuyer based on the project construction stage.<\/span><\/p>\n

Even though the buyer has restricted money for purchasing property, he still is capable of booking a property.\u00a0<\/span><\/p>\n

Due to this, the developer gets the funds in advance from this transaction for the construction rather than using their own funds or borrowing from other institutions.<\/span><\/p>\n

The buyer is subjected to paying EMI once the bank starts the money disbursement to the builder.<\/span><\/p>\n

Note:<\/strong>
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How is CPL Payment Plan Implemented?<\/b><\/h2>\n

In the CPL payment plan, the bank is responsible for paying the money to the developer which is dependent on the progress of the project construction.<\/span><\/p>\n

Keep in mind that the bank institution is actually providing the funds to the buyer in this case rather than the builder directly.\u00a0<\/span><\/p>\n

However, because the development is still only on paper, it gives the builder the loan amount in instalments based on how far along the development is.<\/span><\/p>\n

In simple words, the banks will transfer to the builder a fraction of the total money borrowed from the buyer each time a specific stage of the project is finished.<\/strong><\/span><\/p>\n

How can you calculate EMI in a Construction-Linked Payment Plan?<\/b><\/h2>\n

There are a lot of misunderstandings regarding the payment in CLP plans.<\/span><\/p>\n

The buyer must first understand that these are not similar to subvention schemes, where they are exempt from making EMI payments until they take ownership of their property.\u00a0<\/span><\/p>\n

In a construction-linked plan, the EMI begins as soon as the bank gives the builder a particular segment of the loan amount.\u00a0<\/span><\/p>\n

The EMI keeps rising in line with the expansion of the bank’s loan disbursement to the builder.<\/span><\/p>\n

You can also calculate the EMI with the help of an <\/span>EMI calculator<\/span><\/a>.<\/span><\/p>\n

Also, check out <\/span>What is a Home Loan Protection Plan and What are its benefits?<\/span><\/a><\/p>\n

What are the <\/b>Advantages of a Construction-linked payment plan<\/b>?<\/b><\/h2>\n

\"Advantages<\/p>\n

Buying a property which is still under construction comes with a lot of benefits such as the price of the property being relatively less compared to the ready-to-move-in property.\u00a0<\/span><\/p>\n

Also, under-construction property gets a good appreciation rate until the project completion.<\/span><\/p>\n

Another benefit of investing in under-construction property is the Flexi payment option for buyers.\u00a0<\/span><\/p>\n

Here are the advantages of a Construction-linked payment plan for buyers.<\/span><\/p>\n