Construction-Linked vs Time-Linked Payment Plans
When you buy an apartment that is still being built, how and when you pay matters as much as the price. These are the structures buyers commonly see.
1. Construction-linked plan
You pay in instalments tied to construction milestones, such as completion of the foundation, a number of floors, internal finishing and possession. Your payments follow the work on site, so you pay more as the building progresses. Ask for the exact milestone list and the percentage due at each stage in the agreement.
2. Time-linked plan
Payments fall due on fixed dates or after fixed intervals, regardless of the construction stage. This can be easier to plan for, but you should check what happens if construction runs behind the payment calendar.
3. Down-payment or subvention-style plans
Some builders offer a large upfront payment in return for a discount, or schemes in which a part is paid later. These can look attractive, so ask for the full cost and the exact terms in writing, and compare with the standard plan. If a bank is lending part of the amount, confirm the lender's disbursement rules before you agree.
What RERA says buyers should know
- A promoter cannot take more than 10% of the cost as an advance or application fee before a registered agreement for sale is signed.
- For registered projects, the promoter must deposit a portion of the money collected from buyers into a separate project account, to be used for that project's construction and land cost.
Check the current provisions on the K-RERA site or with a lawyer, as rules and state notifications can change.
What to check in the agreement
- The payment schedule, milestone by milestone, with percentages
- The possession date and the remedy if it is delayed
- Interest or penalty terms for late payment, and whether they apply equally to the builder
- Which charges are extra, such as parking, club membership and maintenance deposit
See also our ready to move vs under construction guide and the EMI calculator to test what each plan does to your monthly outgo.
This guide is general information to help you ask better questions. It is not legal, tax, financial or loan advice. Rules and rates change, so confirm current requirements with the relevant authority, your lender or a qualified professional before you decide.
