Tips and Tricks to Reduce your Home Loan EMI

With feasible home loan opportunities, it has now become possible to fund buying or constructing the home of one’s dreams. However, a housing loan comes with equated monthly instalments (EMIs), which are determined by two factors, the interest rate that an individual pays and the loan’s length. Paying large home loan  EMIs means less disposable income, which could lead to drastic lifestyle adjustments. As a result, the home loan EMIs will continue to affect the borrower’s expenses and income for a long time. 

Some tips to lower EMI on home loan interest rate in India are:

1) Compare Rates Online

Browsing is an excellent way for house loan borrowers to compare home loan offers. Several websites and online portals summarize the interest rates, fees, and other costs charged by various lenders. By scouring the internet and visiting stand-alone portals or aggregator websites that provide a summary of various home loan ROIs, fees, and other expenses, one can find the best home loan interest rates. An individual can also avail of PMAY Home loan benefits by simply meeting the PMAY eligibility criteria. 

2) Go for a Longer Repayment Tenure

When one chooses a longer loan term, their home loan EMI is lower, but they pay more interest on their outstanding balance. One should only choose longer loan payback terms if they believe they’ll not afford higher EMIs. Before taking out a home loan, one should carefully analyse the terms and interest rate alternatives accessible to them. The borrower can use ET Wealth’s housing loan EMI calculator for this.

3) Try to Make a Higher Down Payment

It is advisable to pay a higher down payment to lower the expense of EMIs as no lender will provide the loanee with a loan for more than 80-90% of the property value. However, the remaining 10-20% will be required as a down payment on a home loan. So, once a loanee makes a 20% down payment, they’ll have to worry about paying interest on the remaining 80% of the home’s worth. A larger down payment raises one’s home loan eligibility, which increases the chances of loan acceptance. One can also easily check their home loan eligibility with the home loan eligibility calculator.

4) Negotiate the Service Terms with the Existing Lender

One can negotiate the service terms of the home loan if they have an amicable relationship with their current lender. This might help reduce interest rates on their loan amount. Alternatively, if an individual discovers that another lender is willing to give them house financing at a lesser return on investment, take advantage of it. Switching lenders amid a loan term to lower one’s home loan EMI is not a problem, and it is sometimes recommended.

5)  Make Prepayments From Time to Time

If the borrower receives a yearly bonus, incentive, or other forms of additional income, he/she can choose the prepay option for the pre-closer of the portion of their loan amount. Doing this will cut their home loan EMI and term by a few months or years.

 With these housing loan facts in hand, an individual would be able to spot an advantageous deal. Indian Companies offering home loans are a solid choice to explore in this regard. They have a low-interest rate on home loans, a tenor of up to 30 years, a high-value sanction, and a Home Loan Balance Transfer facility. To qualify, simply meet the easy home loan eligibility criteria, submit the minimal documentation required to process the loan, and await loan approval.


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