Home Loan: If you can afford a higher down payment on your home loan, you should. This will save you a significant amount of interest and lower EMIs.
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Home Loan: Due to rising property prices, buying a home has become extremely difficult for the common man these days. At the same time, a home is a must. Therefore, to fulfill your dream of owning a home, one has to take out a home loan. After taking out a home loan, people become overwhelmed by the EMI payments. Sometimes, people wonder when they will finally be free from the hassle of EMIs. If you also want to repay your loan quickly, we’re offering some tips that could save you lakhs of rupees.
Banks offer loans with EMIs up to 50% of a customer’s salary. However, you must not have any other existing loans. Getting loans has become so easy these days that people often have multiple loans. This can lead to a poor debt-to-income ratio. If you’re considering a home loan, consider paying off your other loans first. This will help you secure a larger home loan at an affordable interest rate.
Pay one extra EMI every year
If you have a home loan , try to pay at least one EMI each year. If you pay an extra EMI, it will be deducted directly from the principal amount, not the interest. This will reduce the interest burden and reduce your loan tenure from 25 years to 20 years. This method doesn’t require much effort. Simply save an extra portion of your monthly salary or use your job bonus to pay it off.
Loan prepayment
The easiest way to get rid of a home loan is through prepayment . You can prepay your home loan from your savings, reducing your interest. You can make small prepayments over a period of time. This amount is added directly to the principal. This will not only reduce your interest but can also reduce your loan term and EMI.
Make extra payments in between
You can also close your loan early by making an additional lump sum payment. A lump sum payment is a one-time payment in which you pay a large sum to the bank. This covers your interest and principal amount. This method is used by most people.
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