Is a 10:90 Payment Plan Better Than a Construction-Linked Plan?
See how a construction-linked payment plan stacks up against a 10:90 structure so you can pick the right way to fund a Mumbai home. Compare both today.
Choosing how to pay for an under-construction home in Mumbai is rarely just about the numbers on a brochure. It’s about choosing a payment plan that works for your cash flow, matches your comfort with risk, and, most importantly, gives you confidence that the builder will deliver the project on time. In short: a 10:90 plan asks you to pay mostly at the end, while a construction-linked plan asks you to pay as the building actually comes up.
A quick summary:
- What separates a 10:90 plan from a construction-linked payment plan in practice
- How each structure affects your EMIs, interest outgo, and loan eligibility
- Which buyer profile does each plan tend to suit
- Why the developer's delivery record matters more than the split itself
What is a 10:90 Payment Plan?
A 10:90 plan does what its name suggests: the buyer pays roughly 10% of the property value upfront at booking, and the remaining 90% is deferred, typically payable at or near possession. It suits markets where developers want a low entry barrier, or projects already close to completion, where the builder is confident enough to carry the funding risk itself.
What is a Construction-Linked Payment Plan?
This structure works quite differently. Rather than deferring most of the cost, it ties each instalment to a verified milestone: plinth completion, slab casting, brickwork, and so on. A demand letter goes out only once that stage is certified, so the buyer's money moves in step with real, physical work on site.
Under the Real Estate (Regulation and Development) Act, 2016, 70% of buyer collections must be placed in a dedicated escrow account for that project, with withdrawals certified by an architect, engineer, and chartered accountant. A typical milestone-wise schedule may look like this:
- Booking and agreement: 10%
- Plinth/foundation completion: 10-15%
- Slab completion (per floor or in stages): 20-30%
- Brickwork and plastering: 15-20%
- Finishing and fittings: 10-15%
- Possession/OC: 5-10%
Read Also: Benefits of Buying Property in an Under-Construction Project
Core Differences Between the Two Plan Types
Once you move past the headline percentages, the two structures differ on a few practical factors:
Cash-Outflow Timing
With a 10:90 plan, the upfront cost is small (10%). The bulk of the money (the deferred outgo) only comes due closer to possession or when the loan is disbursed.
MahaRERA oversees this in Mumbai and the wider MMR; developers cannot collect more than 10% of the property's value before a registered sale agreement is signed.
A construction-linked payment plan works almost the opposite way. Every time a milestone is hit, there's a milestone release, and a part of the payment goes out.
Risk Exposure
A 10:90 plan puts nearly all your eggs in one basket: timely delivery. If the project runs late, a big chunk of your money has just been sitting there, waiting on a promise that hasn't been kept yet. That's the delivery risk.
A construction-linked payment plan trades that for a different kind of exposure: a progress-linked risk, where you're only paying for work that's already happened, but you're still trusting that each milestone was certified honestly. It's not risk-free either way.
Interest and Carry Cost
A construction-linked payment plan usually starts drawing down your home loan early, which means the lender starts charging interest sooner too, even if it's just on whatever's been disbursed so far.
A 10:90 plan pushes most of your interest payments closer to possession. You pay later, but the total interest can still end up being just as much.
Eligibility and Loan Fit
A construction-linked payment plan works the way most lenders prefer. They release the loan in stages as construction progresses, making the loan process smoother.
A 10:90 plan can sometimes need a closer look before lender approval comes through, simply because a large, single payout near possession is a different kind of commitment for the bank.
Best-For Profile
At the end of the day, it comes down to you. If you're expecting a lump sum later (say, from a bonus, an investment maturing, or selling another property), a 10:90 plan might suit your risk appetite. However, if you'd rather pay steadily and keep an eye on the site as it develops, a construction-linked payment plan fits that budget better.
Read Also: Understanding the 30:70 Payment Plan for Aden, Cleon, and Stella: Own Your Dream Home.
Side-by-Side: 10:90 vs Construction-Linked
Here's a side-by-side comparison, so you can weigh it against your own budget, risk appetite, and possession timeline:
Why the Developer Behind the Plan is What De-Risks It
No payment structure, on its own, guarantees anything. What determines whether your money is safe is whether the builder honours the schedule and hands over the keys when promised.
That's the philosophy behind "It's Thoughtful, It's Rustomjee", a 29-year track record of doing exactly that:
- 17,000+ homes delivered
- 25 million+ sq. ft. developed
- 280+ buildings completed
Rustomjee's own plan reflects that thinking: 10% of the Agreement Value on booking, a further 10% near the Occupancy Certificate date, with the home loan funding 75% across construction milestones and 5% at final demand.
Construction-period interest is covered by Rustomjee, so there's no EMI until possession, arranged through lending partners including ICICI Bank and Axis Bank on select residences.
Which Plan Fits Which Buyer
There isn't a universally "better" option here. Before signing either plan, it's worth asking yourself:
- Can I comfortably fund the balance amount whenever it falls due?
- How does the disbursal schedule line up with my existing rent or EMI commitments?
- What is the developer's track record on past possession dates?
- Does the payment schedule match what's registered with MahaRERA?
- Am I comparing total cost of ownership, or just the upfront figure?
- Has my lender disbursed against this developer's schedule before?
Conclusion
In the end, neither plan is automatically better. The payment split is just the structure; the real confidence comes from choosing a developer with a proven track record of delivering on time.
If that's what you're looking for, a plan with minimal upfront pressure and a builder with the track record to back it, take a closer look at Rustomjee Vista Bay in Parel Extension or Rustomjee Stella in Bandra East today.
Frequently Asked Questions
Basically, instead of paying it all upfront or waiting till possession, you pay a bit at a time; each instalment goes out only once a particular stage of construction is actually done and verified.
A 10:90 plan defers roughly 90% of the cost to possession after a small upfront payment; a construction-linked payment plan spreads payments across the build period as milestones are certified.
Usually just pre-EMI interest on the loan amount disbursed so far, not the full EMI, until the loan is fully disbursed or you take possession.
Because no schedule protects you if the builder doesn't deliver on time. A strong, MahaRERA-verified delivery history is what actually reduces your real-world risk.
