Reduce Home Loan EMI vs Reduce Tenure: Which option can help you save Rs 30 lakh & 5 years on Rs 65 lakh loan

The prepayment enactment is simply a mode of paying disconnected your indebtedness magnitude successful parts oregon successful afloat earlier your indebtedness tenure ends. This enactment tin assistance you prevention wealth connected interest, and trim your indebtedness tenure. Thus, let’s find retired which option, is going to prevention you Rs 30 lakh connected Rs 65 lakh, 25-year loan.

What is prepayment?

A prepayment is erstwhile you wage disconnected a indebtedness oregon owe earlier than planned. You tin wage the full magnitude astatine erstwhile oregon conscionable a portion of it. You tin besides marque other payments connected apical of your regular payments to wage it disconnected faster.

When tin you usage prepayment option?

The enactment of prepayment depends connected the benignant of indebtedness and the lender's policy. However, galore banks person a lock-in play of 1–3 years, during which prepayment is not allowed.

Home indebtedness calculations for Rs 65 lakh loan

We volition bash the calculations of Rs 65 lakh location indebtedness astatine a 9.5 per cent involvement complaint for 25 years.

What volition beryllium your EMI connected 65 lakh location loan?

The estimated EMI volition beryllium Rs 56,790.

What volition beryllium involvement and repayment amount?

The estimated involvement volition beryllium Rs 1,05,37,085 and estimated repayment volition beryllium Rs 1,70,37,085.

What volition beryllium prepayment amount?

We are considering Rs 6,50,000 arsenic the prepayment magnitude (10 per cent of the loan’s main amount)

When volition you marque prepayment?

We volition marque a prepayment successful 3 instalments of Rs 2,16,666 each. For a indebtedness started successful February 2025, the archetypal prepayment volition beryllium made successful February 2028, the 2nd successful February 2029, and the 3rd successful February 2030. 

What to bash aft prepayment?

You tin either support the aforesaid EMI arsenic before, oregon you tin prime a reduced EMI option.

What if you opt for reduced EMI option?

If you take the enactment of reducing your EMI aft prepayment, your revised estimated EMI volition beryllium Rs 50,823 from Rs 56,790. It means you volition prevention an estimated Rs 5,967 each period for the remainder of your indebtedness tenure. You volition beryllium redeeming Rs 8,52,977 involvement connected the loan. 

What if you opt for reduced tenure?

If you opt for the aforesaid EMI arsenic it was earlier the prepayment (Rs 56,790), you volition prevention the involvement magnitude and your indebtedness tenure volition besides beryllium shortened. Your revised estimated clip duration to repay the indebtedness volition beryllium 5 years and 4 months. 

What volition beryllium your revised involvement amount?

After choosing the enactment of the aforesaid EMI, you volition prevention an estimated involvement magnitude of Rs 30,12,771.

What volition beryllium your caller indebtedness tenure?

Your caller indebtedness tenure volition beryllium 19 years and 8 months alternatively of 25 years.