Worried About the Monthly Home Loan Installments? This Guide Is for You!
Posted on May 29th, 2020
Even with low-interest rates, home loan EMIs can be expensive owing to the high-value financing. Borrowers may find it difficult to pay the same, especially at times of emergencies.
Few of the ways they can manage their loan EMIs effectively are as follows –
- Calculate EMIs before applying
Individuals should use a house loan calculator before applying. This way, they will be able to ensure they can pay the monthly installments without any hassle.
The calculator will help them pick the right tenor and loan amount that keeps their EMIs affordable.
At all times, borrowers should ensure that their existing debt along with the home loan EMIs is not more than 50% of their income. Keeping a low debt-to-income ration helps them to address other financial worries comfortably.
- Make a larger down-payment
Usually, the ideal down-payment that borrowers should make is 20%. However, a larger margin will lower the loan amount, which will reduce the EMIs and also the total cost of the loan.
- Part-prepay when possible
Part-prepayment is a facility that enables borrowers to pay a lump sum amount to reduce the outstanding loan balance. It will either reduce the EMIs or loan tenor.
Home loan borrowers should tray and part-prepay during the initial months of repayment. Doing so will help them to save more on interest.
These were the few ways through which customers can manage their housing loan EMI efficiently.