Mr. Abhishek Mahapatra, a resident of Cuttack, and a Marketing Manager by profession had availed a Home Loan 2 years before. He had a decent income and also some investments which ensured no issues in the repayment of the Home Loan EMIs.
However, he was of the opinion that since a Home Loan was for a longer duration, it would keep his savings and income directed towards its repayment. It also meant not being able to target other financial goals when the Housing Loan is active.
That’s where he wanted to know some easy methods that could help him manage his Home Loan interest rates and pay the loan quickly. If you are stuck in a situation like above, let’s provide you some easy tips to manage Housing Loan interest rates and repayment! The biggest hurdle that people face is paying the Home Loan EMIs for a longer period and not being able to do anything for other financial goals. Why? It’s because it’s not easy to handle the unexpected overheads.
Here are some easy ways to breeze pas the repayment process faster and manage your interest rates.
1) Pay more than your EMIs if you can
Always know that the Husing Loan interest rate will come down if you pay more money towards the principal availed from a lender. Thus, paying smaller EMIs for longer tenor will keep you occupied with its liability for a longer time. Thus, to control the interest rates and to pay the House Loan quickly, try to pay a higher EMI if you can. By paying higher EMI, you can possibly save months or years of the repayment period. You should also invest some amount smartly to be able to reap its ROIs to be able to pay higher Home Loan EMIs.
2) Manage your funds
The mission while managing your investments and loans is to streamline the cash flows. Make it a point to compare your monthly returns (investments) with monthly payments. If you see that a certain investment is not reaping expected ROI, you can close it and use the amount towards the Home Loan EMI payment. It would be suggested to invest in a vehicle that gives you more interest benefits than your Home Loan rates. You can use the differences between the two to prepay a Home Loan account.
3) Opt for partial pre-payment
Be informed to know that the longer you will take to pre-pay the loan amount; you will be paying more Home Loan interest rates. Yes, making prepayment is a great option to lower your loan tenor, Home Loan EMIs and overall obligation. What’s more, leading banks and lenders do not charge extra amount for prepaying your Home Loan. Thus, you can be sure of not paying any penalty while using the facility. You can also ask your lender for more information!
4) Move to a lender that offers a lower Home Loan rate
One of the other methods to lower down your Home Loan interest rate is moving to a new lender that offers a lower rate. Yes, you can opt for the Home Loan balance transfer facility and switch an old account to a new lender and make it affordable. What’s more, lenders also give you a top-up loan option up to Rs.50 lakh to cover other needs. You can also get a 3 EMI holiday to streamline your budget accordingly before starting to pay EMIs to your new lender.
The Bottom Line
You just went through some of the prudent tips to manage your Home Loan interest rates so that you can pay off a Housing Loan easily. Start implementing them today if you are finding it tougher to manage your Home Loans! Good luck!
