Category Archives: mode of payment

Process of Home Repayment- Mohali

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Process of Home repayment in Mohali , you must understand that When you are planning to buy a house, it is very important to choose the right mode of payment, the most difficult part in buying the house is the payment plan, because of which investors back out from purchasing a house. Whenever you are planning to buy  identified property in Mohali  it is very important to discuss the various modes of payment with the builder and understand them very carefully to avoid any further confusion after you bought the house. In India the popular modes of payments are:-

Road of Mona City Project

  • Down payment plan.
  • Construction linked payment plan.
  • Felix payment plan.
  • Time linked payment plan.

Let`s analyse these plans in details

Down payment plan:- Under this plan generally to have to submit 10% of the total amount at the time of booking, 80% payment within the next 60 days and the remaining amount at the time of possession, however the thing to keep in mind here is that when you are making the final payment it is not just the remaining amount you have to pay but also 5% of the total amount as stamp duty for registration, property taxes, society maintenance charges, club house charges, parking charges any other charges applicable and payable at the time of possession.

Construction linked plan:-

Under this plan at the time of booking you have to pay 10% to 12% of the total amount, rest is payable in different stages which is linked to different stages of construction, the moment construction reaches a particular stage you will get a demand note for payment generally it is around 20%. This plan is beneficial because it is linked to the performance of the devloper however the loan gets a bit costlier simply because till the time you get the final possession of your house you only have to pay the interest of the loan amount and the actual repayment starts only after possession hence the term of the loan gets longer and becomes expensive.

Flexi payment plan:-

This plan is a combination of the both Down payment and construction linked plan, under this the buyer needs to make one third payment of the total amount and the rest is paid according to different stages of construction, the remaining amount is paid at the time of possession.

Time linked payment plan: –

Under this plan bank loan is taken and payment made according to a specified time and made proportionately, however the biggest risk here is that if there is delay in possession of the house, it affects your repayment plan in this scenario it is important to calculate how much interest you will further incur and how much can you save.

It is imperative that you do not invest in any property without properly studying various payment options, prepare yourself beforehand on down payment, EMI, possession date given by the builder and you will end up making a smart deal.


Housing ministry sets tougher builder norms

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property in mohali

Property in Mohali

People waiting to get possession of their houses may get is sooner than expected, the housing ministry went ahead and said okay to tougher builder norms and accepted the parliamentary committee recommendation on the real estate bill that prohibits developers from diverting more than 50% of money collecting from the buyer to other projects.

The ministry also said that the panel recommendation to empower the state governments to impose stricter guidelines for the developers and see that the developers are not going against the norms, the housing ministry has accepted and agreed to all the recommendations made by the panel, comprised of 21- member select Rajya Sabha committee.

The ministry will go to the cabinet very shortly to the cabinet to get the changes approved so that the bill is presented in the parliament in the winter session. One important recommendation that was accepted is a provision that all projects over 500 sq mt must be registered with the proposed real estate regulator. Earlier the provision was for 1000 sq mt. The interest rate paid by the developer in case of default however stays the same. Real Estate observers and experts feel that these recommendations will go a long way to protect the home buyer`s interest and will further give a boost to the industry and encourage investments.

The government in turn will have to see that the projects are not stuck up in red tape and there are no unnecessary harassment and delay for the developer. This bill which was in cold storage since 2009 covers both residential and commercial projects and there is also a proposal to set up a real estate regulator. Developers will have to submit all the details of their projects like plans, project delivery time schedule, and status of all the mandatory approvals required etc.

If the developer fails to comply with these guidelines there would be a penalty of 10% of the total cost of the project. If the developer violates these guidelines again there would be again a penalty of 10% of the project cost and there could be a jail sentence for the developer.

Read Blog , Click Here  About How to Save Tax Buying Home

Buy your first Home For Save Your More Income Tax

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Buying a new house/apartment for a first time buyer is difficult but it is a profitable step. Now a simple but important question that engenders is, how will it be profitable? To know about this, first we need to have some knowledge about the Indian taxation system. Indian taxation system has big structure with large number of protocols and different sections. To know every protocol/rule is impossible for the common working people. So here we are describing few sections of taxation system which will give you some idea about how buying a home is a profitable step. Before going to taxation section we have to understand the word “Income tax”.

buy home for tax save

Income tax: Income tax is a tax which is directly gathered on personal income. India has well developed tax structure with shared authority of central & state government. Indian government gathers taxes on income except agricultural income which is collected by the state government. If a person earns an income then he/she will pay tax under the following category:

  • Income from salary
  • Income from business
  • Income from house or property
  • Income from other sources.

Section 80C, 80CCC and 80CCD:

About the section which is helpful to save tax, Section 80c, 80ccc and 80ccd are three sections that are very useful but 80c is the most important section. Section 80c allows deduction on your gross total income. These deductions are available to an individual. This deduction is allowed for various deduction and payments. Total limit cannot be exceeding 1.5 lakh for financial year 2015-16 under section 80C, 80CCC and 80CCD. Now coming to Section 80CCC, it allows deduction for any amount paid /deposit in insurance sector/companies or purchasing security bonds. 80CCD allows deduction in respect of contribution in pension account.

Outer area J90 project

Above is a simple explanation of how to benefit from income tax but here is an explaintion how buying home will help you save tax. We all know that in India every working class family buying home avails a home loan facility, which is provided by various banks under different interest rates. Income tax benefit under home loan scheme comes under different section of Income tax Act. To explain tax benefit under home loan, we would be dividing the repayment of home loan into two parts which are as following:

1: Repayment of the actual amount.

2: Repayment of interest on home loan.

Tax benefit on home loan is governed by section 80c, section 24 and section 80EE. We are describing few details about these sections.

Section 80C: it will give benefit on repayment of principal amount of home loan in current financial year. If a person pays some part of principal amount of loan to bank then taxation policy allows him/her relaxation on income tax(limit 1 lakh to 1.5 lakh).

Section 24: this section will give benefit on repayment of interest on home loan. This deduction is allowed under income from house/property category. We all know that a bank always takes interest on every loan. Income from house/property shall be reduced by amount of interest paid on home loan but here some contradiction in section 24. Section 24 especially states that tax deduction on repayment of interest on home loan shall not be allowed before construction of property/house is complete.
Section 80EE: this section is helpful for the first time buyers. This section states that additional tax deduction of 1 lakh rupees to first time home buyers in respect of interest on home loan. Home loan does not exceed 25 lakhs and value of your buying property does not exceed 40 lakhs.

Most often people buy a home using the home loan facility. We all know every working person wants to save tax. There are many way to save tax but buying home with home loan is one of the best ways to save tax. There are two types of profit while buying home.

1: Buyer has own home

2: Tax benefit under home loan facility.

Buy Home For Tax Save

This facility is little more beneficial for first time buyer as compared to the second time buyer. The reason behind this factor is section 80EE. Section 80EE is available only for first time buyers. However the second time buyers need not worry as much as it is a marginal difference on profit. So buying a home using loan facility is a smart choice to save money. In India, a house is the biggest purchase for most families in their lifetime and government realizes that. Government has decided to give some relief to working class family during their tax payment so they are doing many amendments on taxation policy in every financial year continuously to provide some relaxation. To understand how a tax payer gets benefit on home loan, we take an example in four-different conditions:

For Book Your Home Visit :

Loan and Possession of home in same financial year.

Loan now and possession of home later.

Borrower and Owner are different.

During Loan Period Home is given out in rent.

1: Loan and Possession of home in same financial year

Meaning of above statement is that if you took loan and got the possession of the home in the same year. You can take tax benefit on section 80c, section 24 and section 80EE (applicable for first time buyer).

2: Loan now and possession of home later

Meaning of above statement is that if you took loan and got the possession in the next year or later, i.e. taking loan before completion of home construction. In the pre-position period, borrower can claim tax rebate under section 80C and section 80EE(applicable for first time buyer). Section 24 is not applicable before possession. Once borrower takes the possession of house, he/she can claim rebate of pre-possession period in five equal installments subject to condition of pre-possession claim.

3: Borrower and Owner are different

If a person took a loan for another person, either a relative etc, in this condition borrower will not be able to get benefit in tax.

4: During Loan Period Home is given out in rent

It is an important concern for many borrowers who cannot live in their home because of any reason. So they don’t have to worry about it. Still they can apply for relaxation during tax payment.

The above information is only general information provided to you to take the benefits of various tax benefits however we do not take responsibility of any in correct information. It is advised that you take a decision after meeting your chartered accountant or the tax authority.

For More Info Visit : Income Tax Department of India

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