Home loan in India is supposed to be among one of the best credit tools available in today’s investment scenario. There is a wide array of Home loans available to suit the needs and requirements of the homebuyer. Various banks offer a loan for Under construction property, where the home is not yet completely constructed. Under this, the loan is disbursed in small parts based on the construction phases and progress. The builder will pay interest on this loan amount till the house is completed and possession is given over to the buyer. Once the house is handed over to the customer, he will start paying the EMIs.
The bank or the financial institution handing out the loan and the builder will have an agreement as to when the loan will be disbursed and the various stages of the project. The bank will release the loan as per the agreement only on the confirmation of the stages of construction within the time frame.
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One of the important clauses under the home loan under construction is the Time period. It includes –