How to reduce Home Loans EMI?
Owning a beautiful home is a dream that everyone cherishes. However, for a middle-class person, things seem a bit out of control without a home loan. So, here is how you can reduce your home loans EMI seamlessly.
Most perhaps, EMI for a home loan is one of the major monthly expenditure that a myriad of people is dealing with. With EMI’s taking away 35 to 40% of an individual salary, it becomes quite difficult to concentrate on other expenditures.
In such a scenario, just to lessen their EMI burden, people end up extending their tenure, which can usually have a negative impact as they tend to give higher interest rates. So, here are few steps through which you can easily reduce your home loan EMIs.
Pay More forDown payment:
Generally, the EMI and the interest amount are calculated on the basis of the principal amount. So, the lower the amount, the lesser will be the EMI. Therefore, upon buying the house, try giving as much amount as you can as a down payment so that you wouldn’t have to get a larger amount sanctioned while availing a home loan service.
Prepay One EMI:
Another way through which you can decrease your EMI is by paying 1 EMI extra every year. You can use your annual bonus or savings to pay this additional amount. It is not compulsory to pay only one within a year, if you can, then you can add as many as you can afford, just to bring down the burden.
Reduce the Tenure:
Most of the times, in pursuit to get lower EMIs, people seem to have no problem in paying back for a longer period of time. However, the thing that they don’t realize is that by increasing the tenure, they increase the interest rates as well. Therefore, you can consider lowering down the tenure.
Refinancing the Loan:
Another considerate option is to refinance home loan. If you think that you are facing some issues with your current lender, whether in terms of interest rates or services, then you can simply choose this option. It is nothing but getting a new loan sanctioned. Through this loan, you can pay off the earlier debt and can get a new one at comparatively fewer interest rates.
Increase the EMI Amount:
If nothing else, then you can simply increase your monthly EMI amount. Every year, keeping any rise in the pay scale, you can increase the amount by a specific percentage. For instance: if you have got a hike of 5% in your salary, then you can increase the EMI amount by 5%. By doing this, you would be able to pay your loan very quickly.
While getting online home loans sanctioned is an easy thing, repaying back is the most difficult ones. So, in case your tenure is going up to 15 or 20 years, execute these above-listed ideas to lower down your EMI amount and your burden subsequently.
