Tips to reduce the burden of home loan EMIs

Published on : 12:49 PM Dec 04, 2021

Of late, owning a house has become easy, thanks to banks, which are lending home loans with an affordable interest rate. But, soon or later, the buyers either face problems in clearing loans or have extra money received by selling a property or inherited from the ancestral property. So, to clear their doubts on EMIs, 'Siri' will provide tips to those who wanted to lead a tension-free life by clearing their home loans.

Hyderabad: Buying a house is everybody's dream and in order to realise it they take home loans. With banks competing with each other to grant home loans those who wish to own a house are approaching them. In turn, banks, too, are sanctioning loans with lower interest rates. But, homebuyers should know how to reduce the burden of EMIs with a meticulous plan.


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Once the buyers decide to buy a house, they need to draw up a proper plan. With 40% of the earnings earmarked for housing EMI, buyers need to figure out how to manage other expenses and savings in the remaining amount. Hence, the plan to wriggle out of the burden of monthly installments at the earliest has to be carefully planned.

A few tips to ease out the burden on home buyers

One additional installment: The buyer usually pays 12 installments a year, but if he wants to complete the loan installments quickly, he needs to shell out 13 installments. For this extra installment, the buyer needs to utilise extra money earned through other sources or by pruning down their regular expenses. By this, the principle amount of the loan will be reduced and the loan can be repaid before the scheduled time. Banks and housing loan lenders do not charge any upfront fees on home loans provided at a floating rate. Paying EMIs in advance will improve your credit score as well.

Unable to meet expenses...

After paying housing installments, if the buyer is unable to meet his other expenses. Need not worry. With the reduction in interest rates, the EMIs are bound to be reduced. It is better to check out with respective banks and housing loan lenders for more details. Also extending the term of the loan, which eventually reduces the EMI, is another good option after checking out the eligibility factor. This will allow the buyer to look after his household expenses without any problem and also if there is a hike in earnings, do not forget to enhance the EMI proportionately.

Furthermore, if buyers get good money after selling any property, or by inheriting a lump sum amount from elders. In that case, the money can be given to the lender towards principle amount to repay the loan at the earliest. Therefore, the interest payments will be reduced.

Currently, housing rates are getting lower than ever. If the buyer is still paying high interest on the loan, he needs to re-think. Rather, he can try to transfer that loan to another bank. If there is a lower interest rate, which will reduce the EMI burden to some extent. However, consider fees and other charges before taking a decision otherwise drop the plan.

Finally, EMI's shouldn't exceed 40% of the earnings for a decent living. So, try to reduce the burden of installments as much as possible.

Also read: Home loan demand rising in mid, high-range segments

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