Buying a home of your dreams is one of the huge financial responsibilities you might ever take. With so many banks and financial institutions offering attractive home loan interest rates, buying a home has become quite a seamless experience for many home aspirants. Furthermore, in today’s market, anyone can choose a home loan with the aid of home loan eligibility calculator. This can help you gain a detailed insight on your eligibility criteria for housing loans. Getting a home loan and paying them back through Equated Monthly Installments (EMIs) has become a trend for the millennial of our generation.
A home loan is a long-term contract with the bank of your preference. A loan repayment period can take up to 10 or 20 years and sometimes even more. Also there might be some unforeseen circumstances which can result in ending up in a situation where you are unable to meet your EMI payments on a regular basis. The reason for non-repayment could vary from loss of job to improper financial planning to poor health, disability or even demise of the borrower. As such, for many new home buyers, EMIs comprise of a significant portion of regular savings and paying them regularly can seem an uphill task.
Non-payment of EMI brings penal interest and charge. Although you cannot predict your financial difficulties, here are some of the methods which can help you plan for your future EMIs and avoid defaulting on your home loan:
Plan your investments
It is quite essential to work out your finances before opting for a home loan. You can also avail the assistance of home loan eligibility calculator to determine your budget and allowance. Additionally, you can also begin investing your remaining funds into investment portfolios, so as to be prepared for emergency situations. This can help you significantly in timely EMI payments later on.
Home loan interest rates may vary across different banks. Hence, you need to choose the one which offers you a competitive interest rate and suits your budget accordingly.
Prepayment of EMIs
Minimise your overall interest on your home loan or reduce your EMIs with regular part prepayments. Even a tiny portion of money saved can significantly assist in prepayment of EMIs.
Refinancing of Home Loans
When you avail home loan refinance, a top-up loan can reduce the burden of EMI repayment. This can significantly assist to avoid being defaulted.
These tips can come handy in avoiding delays in home loan installments. Before you get a housing loan, do check all the details, interest rates and other aspects of the loan to avoid defaulting in your Home Loan EMI.