Can You Buy A Home With Your Credit Card?
Real estate companies are known to seek cash payments from home buyers. In today's age of online payment, card payment and digital payment, property developers in India are also adopting non-traditional methods of payment. Recently, Tata Housing started accepting payments either through credit cards or debit cards.
Through card payments, realty companies can make it convenient for investors and home buyers to make payment while buying property in India. Interested parties can make the payments online via the cards, reducing travel and other inconveniences of a face-to-face meeting. This can also ensure that the legwork during a property purchase is reduced.
Why cards?
Until now, no other real estate company has tried this method of payments. The booking and upfront payments are mostly done in cash or through cheque. This move by Tatas also coincides with the government's and the Reserve Bank of India's efforts to reduce cash usage and make electronic payments more prevalent. Use of credit cards and other forms of electronic payments in property purchases might discourage use of black money in the real estate sector.
How can cards help?
Credit cards help buyers of upcoming properties in India especially when it comes to making payments without having the entire cash in hand. Real estate investments are financially stressful and empty a person's bank account in times of need. Credit cards can come handy at this point. Also, making a real estate payment requires a lot of time for a home buyer to turn his money liquid. A credit card payment will ensure that the person will not have to miss a good offer to make a down payment days or even weeks ahead, than in other forms.
Card payments can also cut down real estate fraud. Many fraudulent companies which either claim to be a part of big realty majors or otherwise insist on cash payments. What makes it tougher for a person to differentiate between fraudulent and genuine companies is the fact that even large realty companies developing upcoming flats for sale in India take cash payments. Making a payment online on a company website is a much more secure way of investing. In case a person is being cheated, an online payment can always be reversed easily. This would also solve the need for escrow that many people use as a method of payment for real estate.
Comfort factor
As online, mobile and digital banking are becoming popular, more and more people prefer these methods of making payments while buying property in India. The need for security offered by a credit card company is also becoming necessary to ensure users, who like this method while making large payments, that the transactions are safe and secured. Real estate companies are only becoming consumer-friendly by stepping into this area.
(The writer has been working as a business journalist for the last nine years, and has covered beats across banking, pharma, healthcare, telecom, technology, power, infrastructure, shipping and commodities)