What is CLP in Real Estate?

The full form of CLP

in real estate stands for "Construction Linked Plan." It is a payment plan commonly used by real estate developers for under-construction properties.

What is the Meaning of CLP?

Construction Linked Plan or CLP full meaning, involves the payment schedule that is linked to the stages of construction progress. 

• Typically, the total cost of the property is divided into several installments, and each installment is payable by the buyer as construction milestones are achieved.

• The number of installments and the percentage of payment at each stage may vary depending on the developer and the project.

• The buyer pays a certain percentage of the total cost of the property as a booking amount at the time of booking the unit.

• The remaining amount is divided into several installments, and each installment is linked to the completion of specific construction milestones such as foundation, plinth, structure, brickwork, flooring, etc. As each stage is completed, the buyer is required to make the payment for that stage.

• The payment schedule and the percentage of payment at each stage are typically mentioned in the buyer's agreement or allotment letter provided by the developer.

• CLP offers flexibility to buyers as they pay for the property as per the progress of construction. It also provides transparency as buyers can track the construction progress and ensure that payments are made accordingly.

• In many cases, developers provide an interest-free period during the construction phase, allowing buyers to save on interest payments until possession. Once the construction is completed and the property is ready for possession, the buyer is required to make the final payment and take possession of the property.

• CLP is a popular payment plan in the Indian real estate market as it offers a structured and transparent payment schedule, reducing the financial burden on buyers compared to other payment plans like down payment or time-linked plans.

However, buyers should carefully review the terms and conditions of the CLP offered by the developer before making any commitments. This is the

full form of CLP.

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I am a real estate investment advisor and over the past few years, I have noticed that there have been many ups and downs in the Indian real estate market. Every time the market experiences a low, the industry develops novel strategies to boost sales and entice customers. Following the fashion, builders and developers create a number of cutting-edge payment plans, some of which are now very well-liked by consumers. One such programme is a CLP. CLP full form in real estate is a Construction-Linked Payment plan. Let me help you understand this concept clearly.

What is CLP meaning in real estate?

A tripartite agreement between the buyer, builder, and loan/financing business is known as a CLP plan. The purchaser gives the down payment. Following that, the bank or financing company pays the builder in instalments upon the completion of the project's predetermined construction milestones, known as slabs.

When the project is finished, the last payment is made. The buyer pays the bank a pre-EMI interest on the home loan during this time. After the building is finished, the buyer begins making EMI payments to the bank or finance company.

What is CLP in real estate advantages and disadvantages?

The main benefit of a CLP plan would be that the consumer only needs to make payments as the construction advances. CLP plan in real estate, however, has its share of drawbacks.

Advantages:

• The middle-class buyers who are unable to make significant financial commitments are best served by the payment plan.

• Only after taking ownership of the site does the buyer start paying the bank back.

Disadvantages:

• Only after taking ownership of the house does the buyer make the EMI payments. He must, however, pay the pre-EMI, which is the loan's interest component, as well as the rent for his present home.

• Developers may withdraw 90% to 95% of the money from the banking institution, delaying the project's ultimate handover by 2 to 3 years. The buyer suffers at the whims of the builder, not only being refused the goods but also having to pay loan interest.

I hope now you understand CLP full form in real estate.