Planning to buy a new home, you surely would have been flooded with options where in you can pay in different time limits. These are different payment modes made available to the customers to make buying a home more easily convenient and affordable.

But how do you understand which one stands for what and most importantly which one suits you the best?

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Here’s a brief on the most common payment plans offered to customers and in which scenario should they be selected.

  1. Down Payment Plan – This is the first payment plan usually offered to the customers where in usually you need to pay 95% in the first 30 – 60 days of booking.Now, this payment plan is most suited for people who have surplus money and are looking to invest it somewhere. The biggest advantage of this payment plan is that per square feet price in this case is the lowest. Therefore, you end up paying the least for the same apartment as opposed to any other payment plan you opt for.
  2. Construction Linked Payment Plan – This is again a very common payment plan offered to the customers. In this case, the payment pattern is linked to the construction of the project as the name suggests.As the construction keeps happening, after every landmark the customer is expected to pay a certain amount, which is predefined. For example, 5% of the total amount on excavation, 10% on laying the foundation, 5% on completing the 4th floor and so on and so forth.Since one is paying as per the construction, there is no question your money going in vain. Therefore, this is the best payment plan for those who put their life’s savings into it.
  3. Subvention Plan – This is a very convenient and friendly payment plan been introduced in the real estate industry lately. Here in you just need to pay a certain percentage in the beginning at the time of booking and post that you would only be paying after offer of possession.To help explain this payment plan better lets take an example of the most common subvention scheme offered, that is, 10:80:10. In such a case, the customer needs to pay 10% at the time of booking, the next 80% is covered by bank loan for which the EMI begins only once the customer gets the offer of possession. Till then, the pre EMI to the bank is paid by the developer. And the last 10% is to be paid to the developer at the time of offer of possession. This is best suited for people who are currently living in rented houses. This is because you can book your home with a booking amount and your EMI begins only once you get the offer of possession. Therefore, you move in and start living in your new house and convert your house rent into your EMI.

Analyze the payment options wisely before deciding on one and make the best deal for yourself.