Buying your dream real estate property is not always a straightforward process. Buyers who choose to avail loans while living on a rented property are always under the tension of the project not being completed on time.
While the government has been working to resolve all such issues to create transparent real estate market; buyers too can keep themselves up to date on what is latest in banking to ensure they are never in troubled waters.
One such facility that a buyer can avail is the Subvention Loan.
A subvention loan is typically oriented towards home buyers taking home loans. A subvention loan has three stakeholders: the builder, the bank, and the buyer. The three involved parties sign an agreement. As per the agreement, the buyer has to pay an initial down payment, while the bank pays the balance amount to the builder just like a normal loan. However, the differing factor is that till the buyer receives possession (or some other condition), the builder has to pay the interest on the buyer’s home loan and the banks release payments as per the construction schedule of the builder.
Two Reasons why subvention loan is necessary:
Some of the benefits of the Subvention Loans are:
Subvention loans have some drawbacks as well, which can be found below:
While subvention loans have many benefits, it is important to read all the documents about terms and conditions attached to the loan before signing the papers.
Since RERA has been implemented, a significant number of delusionary schemes that were being used by the developers will stop and that will work to benefit the buyers.
However, buyers should verify the developer’s credibility before investing in subvention loans.
Subvention loans can be beneficial for home buyers, especially the first-time home buyers if the possession is done on time and there are no hidden clauses from the buyers.
ANP HOLDING: http://www.anpholding.com/blog/
ANP Atelier & Associates: http://atelier.co.in/blog/