Undoubtedly buying a home is a dream and a huge milestone for many. With the soaring real estate rates, investing in a house seems like a far-fetched dream for many. Arranging money for such a huge investment is a challenge.
When it comes to saving for a home, there are several ways to do so – from home loans to traditional savings accounts and recurring deposits. Traditional home loans often come with high interest rates, lengthy paperwork, and strict eligibility criteria. If you are looking for a smarter and more flexible way to finance your dream home, why not consider a chit fund for a home purchase? Before getting into the world of Chit Funds and how it can help you buy your dream home, let us first know what exactly is a chit Fund and how it works.
What are Chit Funds? Chit Fund is a type of financial group saving plan popular in India. It has been a popular investment option among Indians for a long time. In this, a group of people contributes a fixed amount every month into a pool.
Every month, one member wins the collected amount through a bidding process or by lottery. The beauty of chit funds is that you can either save or borrow from the fund depending on your needs. This acts as both a saving as well as a credit product.
If you are planning to buy a house with a chit fund, you can use the winning amount towards the down payment or even to cover a big portion of the property cost. Chit Funds for Buying a Home Using a chit fund for home purchase offers several be.
