1. Pay lumpsum from your surplus often:-
a) By prepaying a lumpsum amount from your bonus or salary hikes, you can save substantial interest outgo and also reduce the tenure of your home loan.
b) It is better to make lump sum payments in the early years of the loan when the principal outstanding is high.
2. Pay higher EMI amount to cut interest:-
a) Starting with a bigger EMI is better, if you can afford it, because an extended tenure with a lower EMI will actually increase your interest outgo than if you had opted for a higher monthly outgo over a shorter period.
b) An EMI can become much lesser if the tenure is raised, but you will also pay substantially more in interest.
3. Pay an extra EMI every year:-
a) There is usually no prepayment charge for floating rate term loans.
b) By paying an extra EMI every year, you can considerably reduce your overall outstanding principal amount over your total home loan period.
4. Pay your EMI on time always:-
a) Any delay severely impacts your credit score, besides penalty.
b) Always maintain a few months' EMI buffer as an emergency fund.
c) Close a few investments with lesser interest rate than your home loan rate for having an adequate amount for EMIs.
a) By prepaying a lumpsum amount from your bonus or salary hikes, you can save substantial interest outgo and also reduce the tenure of your home loan.
b) It is better to make lump sum payments in the early years of the loan when the principal outstanding is high.
2. Pay higher EMI amount to cut interest:-
a) Starting with a bigger EMI is better, if you can afford it, because an extended tenure with a lower EMI will actually increase your interest outgo than if you had opted for a higher monthly outgo over a shorter period.
b) An EMI can become much lesser if the tenure is raised, but you will also pay substantially more in interest.
3. Pay an extra EMI every year:-
a) There is usually no prepayment charge for floating rate term loans.
b) By paying an extra EMI every year, you can considerably reduce your overall outstanding principal amount over your total home loan period.
4. Pay your EMI on time always:-
a) Any delay severely impacts your credit score, besides penalty.
b) Always maintain a few months' EMI buffer as an emergency fund.
c) Close a few investments with lesser interest rate than your home loan rate for having an adequate amount for EMIs.