Home Loan EMIs – Five Ways To Maintain And Repay In The Best Way

Home loan EMIs are a big part of your life once you buy your home with a housing loan. A borrower can spend as many as 20 to 30 years of his life repaying home loan EMIs and thus it is very important to do it the right way.

A home loan EMI calculator is essential for anyone who is seeking a home loan. You should be well informed about your EMIs so that you can prepare yourself for this expense every month. Missing even a single home loan EMI can have bad repercussions on your credit score.

Here are some tips on how to manage your EMI payments like a pro.

1. Schedule your EMIs wisely: Always schedule your EMI payment close to when you get your salary credited to your account. That way you can ensure that you always have sufficient funds when the time pay comes. Just like failure to pay your EMIs can reduce your CIBIL score, paying EMIs on time can boost your creditworthiness.
2. Use extra money to repay your loan: If you happen to come into any money, for example if your inherit money or get an insurance pay out or even receive bonuses or a large increment, use that money to repay your loan instead of putting it in savings. This way you can begin your repayment of home loan and even reduce tenure.
3. Choose higher home loan EMIs: Choose higher home loan EMIs for a short period rather than lower home loan EMIs for long period. You may think that a higher EMI is an added expense, but when you pay lower EMIs for a longer period, you end up paying more interest. With higher EMIs you can pay off your loan faster and pay less in interest as well.
4. Income and debt ratio: Always maintain your income and debt ratio. This means that if your income increases, increase your home loan EMIs as well. This will not only help you repay your home loan faster, but will also help in saving more in terms of home loan interest.
5. Pay an extra EMI every year: This may be a struggle at first, but can help you in the long run. If your home loan EMI is 36,000 INR then try to save 3,000 every month and then use that saving to pay an extra EMI at the end of the year.