PREPAYMENT PLAN

POSTED BY anil kumar ON September 26, 2012 4:50 pm COMMENTS (5)

Good evening Ashal

I’m Anil BG . Recently I went for a Studio Apartment in the commercial belt near Yamuna Xpressway being built by the Earth Infrastructures Pvt Ltd. The builder here is offering 12% assured return on the 95% of the full amount paid in advance with bank guarantee.5% one has to pay on completion.

1. Builder is asking for 95% of the 30Lacs in advance and further via an agreement assuring the 12 % of the assured returns on the said amount.

2. The property in question will be completed in the time duration of 03 yrs.Till then the builder is paying 12 % assured return with bank guarantee.

3. If unable to complete the said property in time,will then even pay the applicable interest on the amount in question.

Following could not be understood:-

(a) What is this assured return ?

(b) In an approx 03 yrs of time builder is repaying almost 12 lacs to the invester thus roughly the investor has got 40 % of his invested amount back.From where the said amount is being generated?

(c) What profit does the builder gaining as per the said scheme?

(e) Why there is no construction link Plan option available for the customers?

(f) Last but not the least,Is it wise to go in such a high risky plan for a common man like me?What if the builder vanished before the completion of the said project.

 

Sir pls help me out as I am thinking to get one Studio apartment in this site.Thanking You

Ani BG

3.

5 replies on this article “PREPAYMENT PLAN”

  1. TheZionView says:

    @anil kumar

    Simple if something is TOO good to be true, It most definitely is NOT TRUE

  2. anil kumar says:

    Sir every thing is secondary at first pls accept my hearty thanks for responding unexpectedly,in a very prompt manner thanks for it………But sir if the said builder happen to be truthful towards his obligation then I would be getting the said property in near about 24 Lacs.Sir why are they not having the Construction link plan?And if they happen to run away then is there any legal procedure through which I can get my amount back.

    1. Biswa Singh says:

      Anil,

      If the property is at appropriate place then in normal scenario also the price should rise by 10-12 % in 3 years or may be more. Paying 95% percent upfront is a complete no no… What if the builder is a fraud one? In case of any issue its not that easy to recover money from builders. If you recover also you have to go through so many hassels.

      The overwhelming offer seems to have some serious implications that you need to figure out. But if i were you then i would have completely avoided it. Everything that glitters is not gold. All the best!

    2. Dear Anil, on one hand you have faith on your builder & another hand you are not sure of safety of your money. Actually you are not the first person who is facing such situation or posting such query. Actually it’s a fight between your own brain & greed. Brain is thinking right that such deal is too much sweet & how it’s possible to get this kind of deal, that’s why brain is posing uncomfortable questions to itself (you). But your greed is trying to keep your brain shut.

      Just spend some time to read so many horror stories of people of similar kind deal, available on internet. I w’d ask you, if the same studio apartment is so good, why are you not purchasing an already built property where you can see stable return in the form of rent if possible. More to it, If we assume, the property ‘ll be indeed ready in next 3Y, w’d you go there to live in?

      Thanks

      Ashal

  3. Dear Anil, I w’d like to answer the last point first –

    Please do not invest at all in such deals for your own good. Why?
    You are paying around 28.5L Rs. upfront. As per proposal, 12% of this 28.5L Rs. ‘ll be your earning from the project till completion. Which is in simplified term 1% mly return to you.
    So you ‘ll earn 28500 Rs. mly.
    Now think again are you earning or actually it’s your own money which you are gettin back over the period of time?

    Think & answer me.

    Thanks

    Ashal

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