Home loan are the two most heavy weight words in life. Thus, we people think before applying for this type of loan. The interest rates, documentation, and other technicalities make the loan sanction procedure tiring and lengthy. Unfortunately, not every home buyer has a strong financial background to pay the entire cost from his or her pocket.
In this situation, we opt for a home loan that helps in the property purchase. Also, we get time to repay the loan. But, it’s always better to close the home loan books as soon as you for possible.
Now the question arises about arranging funds in order to repay the entire home loan in a short period. Worry not because here are the tips for the same.
1. Save Money using SIP – Systematic Investment Plan
What? The SIP is for investment and it is ranked as a one number idea to repay the home loan. Well, it might sound wrong. But, it is actually right. Let us understand it by an example. Let say you have to pay rupees 70,000 to the bank in a year. This naturally means you have to pay rupees 6,000 per month. So, save this 6,000 rupees amount every month by investing in the Systematic Investment Plan and pay total 70,000 in one go. This will bring down your EMIs for twelve months. So, it is a good option to finish the repayment of the home loan early.
2. Increase Your EMIs
The amount of EMIs is defined at the time of loan sanction. Fortunately, the banks offer the flexibility in order to increase the EMI value. So, if you have cut down expenses and have more saving than before. Then definitely, you must visit the bank and ask them to increase the value of your EMIs. Understand with an example.
Suppose you are paying rupees10,000 every month as EMI. But, you can now afford to pay rupees 13,000 every month. Then, deposit this increased value of EMI as it will decrease your loan burden by a huge margin.
3. Opt for Loan with Lower Interest Rate
Compare the interest rates offered by all the banks and apply for a home loan from the one that is offering minimum interest rates on the home loan. This will make the loan repayment easy.
4. Pay in Lumpsum
Try to pay a hefty amount one a year. This brings down the loan amount and also reflects in sooner completion of the home loan. Therefore start saving as it is one of the ways to get relief from the home loan repayment. This is one of the things you must know regarding the home loan repayment.
5. Use Incentives for Loan Repayment
A majority of people get bonus or other cash back on policies. So, use this additional money for repaying the home loan. This will decrease your EMIs and also help you close the home loan account at the earliest.
This five-pointer guide is a simple way to live a stress-free life even after availing the home loan.