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Subvention scheme in home loan is a new form of bank financing for home loans. As per this scheme, once an individual applies for a loan for an under construction property, for the first 2 years of the loan period, the borrower need not have to pay any EMIs, i.e., all the interest for first two years will be paid by the concerned builder/ developer. So, principally you own a property without having to pay any interest for 24 months. Currently, banks have agreed to this form of financing only for Class A builders.
The scheme allows a buyer (after paying upfront amount and getting the balance amount financed by banks) to hop paying any EMI (Equated Monthly Installment) for a property under construction -- till the time of charming its possession. The statement sounds interesting: the developer will pay the EMI till the property is not ready. It is only after that the building work is complete that the owner needs to pay to the bank the principal amount along with the interest.
For example, X buys a property of 1000 sq ft for the rate of Rs. 2000 / sq ft. X decides to avail a home loan for this and hence, makes an initial down payment of Rs. 4, 00,000 and the bank finances Rs. 16, 00,000. After necessary calculations X realizes that he has to pay Rs. 17000 EMI every month.
In 2 years time, the property value has shot up to Rs. 3000/ sq ft.
X just pays Rs. 4, 00,000 in the first 2 years. (Only down payment, no EMI for the first 2 years).
Hence, with enhance in the property price in 2 years, X has seen a gain of 150%.
So, visibly with the bank subvention scheme, investors benefit more.
Below are popular projects funded under Subvention Plan are:
Orris Aster court Premier..
Vatika Premium floor
Gurgaon golf course
Emaar Marbella Gurgaon
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Home Loan Interest Rates
|HDFC Bank||10.75% - 11%|
|Barclays Bank||11% - 11.25%|
|HSBC||10.75% - 11%|
|Kotak Mahindra Bank||11.25% - 11.50%|
|DHFL||11.25% - 11.50%|
|First Blue||10.50% - 11.75%|
|Citi Bank||10.50% - 11%|
|Standard Chartered Bank||10.75% - 11%|
|Axis Bank||10.75% - 11%|
|ICICI Bank||10.50% - 11.75%|
|Deutsche Bank||10.75% - 11%|
|T & C apply*||Know More|