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Protect Yourself Against The Sudden Spikes In Home Loan Rates

By Author: Aishwarya Mahurkar
Total Articles: 291

Home loan is an amazing financial tool for people to afford home without an equivalent amount of cash. In fact, a lot of people depend on it to buy their dream home. However, it is not as simple as it seems to repay home loan EMI for next 30 years. The primary problem for most people is that they are not in a condition to repay all the time. Medical or financial trouble or a spike in housing loan interest rates can jeopardise their repayment schedule. If you have availed loan with floating home loan rates, you must know how to protect yourself against any variation in interest rates.

Plan your expenses at the start of the month

Any home loan borrower must plan the budget in order to repay home loan EMI on a monthly basis. This seems obvious enough and most borrowers do follow through on this budgeting effort in first few months. However, most get comfortable with the amount of EMI and then, they tend to ignore this step. But, if you have opted for a loan with floating home loan rates, you must adhere to this process religiously. This will help you maintain your financial discipline. It will go a long way when there is a family emergency or a financial crisis. Financial discipline is at the core of your financial well being.

Create an emergency support

You can neither anticipate your home loan EMI foe next 30 years nor can you control your life for next 30 years. At best, you can remain prepared for few surprises along the way. You may have to face a medical emergency. There might be a sudden spike in home loan interest rates . It can happen. So, you need to create a cash reserve that can support you in the times of struggle. Set a fixed deposit or any other form of investment. This can support you to repay EMI. You cannot always anticipate spike in housing loan interest rates. This is the best way to stay ahead of the fiscal challenges.

Prepay, when possible.

As of today, borrowers, who have opted for a home loan with floating home loan rates in India, can prepay with 0% prepayment charges. You must make use of this offer while it is available. You can prepay and reduce your home loan tenure. You can also it to shift to lower EMI with home loan balance transfer. This seems unnecessary to several home loan borrowers. But, it is vital to stay ahead of the game while you can. It will come in handy in troubling times indeed.

Make most of your savings and create support system that you can use easily. This is the best way to stay ahead of spikes in housing loan interest rates.

Author Bio :

The author is a seasonal writer on topics of finance and the home loan sector. Through her writing, she articulates aspects that are important to people availing facility such as home loan interest rates, documents, eligibility criteria that help to make the best decision.

Total Views: 91Word Count: 509See All articles From Author

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