What Are Some Simple Ways To Reduce Your Home Loan Emi?

A home loan ensures a sizeable credit facility, allowing borrowers to purchase their dream homes. Moreover, attractive offers, low interest rates and longer tenor make it a popular financing option to fund real estate purchases. However, when it comes to repayment, borrowers need to be wise about paying monthly instalments.

If you are planning to avail a housing loan, here are some of the ways to reduce home loan EMI efficiently:

3 tips to lower home loan EMI

Following are some of the effective tips to reduce home loan EMIs:

Tip 1: Make a substantial down payment

Usually, financial institutions fund up to a certain percentage depending on the property’s market worth as a home loan. The borrower will pay the remaining amount as a down payment. As per rule, a substantial down payment refers lower principal, thereby reducing the monthly instalments. Moreover, the borrower’s loan eligibility is also enhanced when applying for the best home loan with lower LTV as the risk of borrower’s loan default is reduced significantly.

In this regard, borrowers can also use a home loan eligibility calculator to determine the exact amount they are eligible for and apply accordingly.

Tip 2: Switching lenders

If borrowers think that their current home loan interest rate imposed by financial institutions is on the higher side, they can consider a home loan balance transfer. Transferring the remaining principal amount to another lender at a favourable interest rate will allow borrowers to save a considerable amount over the tenor.

Tip 3: Choose a longer tenor with part-prepayment

Ideally, a longer tenor ensures reduced EMIs, but the interest outgo will be higher. Therefore, before availing of a home loan, draft your upcoming liabilities and prepare a prepayment plan accordingly. In this regard, an EMI calculator can be a good help. With the help of this calculator, borrowers will know how to calculate home loan EMI and plan their repayment efficiently, thereby reducing monthly monetary strain.

To sum it up, now that borrowers know how to reduce home loan EMI with the help of these effective tips, they can significantly ensure hassle-free repayments.

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