123ArticleOnline Logo
Welcome to 123ArticleOnline.com!

ALL >> Investing---Finance >> View Article

Home Loan Repayment Options You Must Consider

By Author: Aishwarya Mahurkar
Total Articles: 291

Repaying a home loan shouldn’t make you fret at the end of every month, as nowadays repaying the loan on your dream home has become much simpler. A thing to keep in mind while repaying your loans is that EMI will be smaller if you pay your home loan for a longer period of time.

Most home loans takers use the conventional EMI option where a fixed amount is paid every month. In this option, the principal payment is quite high and the amount towards interest is comparatively low, which results in a higher EMI. Since the deducted amount is uniform, customers can plan their monthly payments using EMI calculators for home loans.

There are some payment options available that can be customised according to a person’s financials, age, type of property, credit history and so on and so forth. Some of them include:

Step up repayment facility (SURF)

This repayment system is directly connected to the borrower’s monetary growth where it allows a customer to pay lower EMIs in the initial years, which gradually increases in successive years, subsequent to an increase in the customer's annual income.

Step down repayment facility

This is structured in such a way so as to decrease the EMI amount as the loan gradually progresses. This repayment plan is best suited for those who are close to retirement, since they would be unable to pay high EMIs once there is a considerable fall in their income. Thus, they can pay off high EMI amounts when they are still employed and ease financial pressure post-retirement.

Tranche based EMI

It allows customers to decide the amount of EMIs they want to pay until the construction of property is complete, since this facility is offered for loans taken on under construction properties. It is very advantageous since the customer can pay off EMIs earlier and therefore repay the loan even sooner.

Accelerated repayment scheme

This allows customers with an opportunity to pay off their loans faster by increasing their EMI amount. This scheme is used when the borrower has a lump sum or an increment in his disposable income that he would like to spend towards repaying the loan faster. It is therefore imperative to make sure that your calculations are accurate and that you do not fall back on your monthly payments by utilising the EMI calculators for home loans.

Balloon payment

This scheme is advised only for those who are extremely financially sound and should be avoided as such customers pay far more interest as compared to other loan schemes. They involve lump sum payments at pre-determined intervals or at the last stages of a home loan.

Author Bio :

The author is a seasoned writer on finance topics and through her writing; she articulates aspects of home loan that are important to people availing the home loan facility. She writes about a variety of topics covering the home loan documents, rates, EMI calculator for home loan that help to make the best decision.

Total Views: 87Word Count: 497See All articles From Author

Investing / Finance Articles

1. Mutual Funds – A Golden Key To A Golden, Secured Future
Author: Mint Walk

2. Tips To Choosing The Right Home Insurance Company
Author: Jason Davis

3. Some Of The Immense Trading Techniques
Author: Robin Scott

4. How To Trade In Nifty Futures And Options-sai Proficient
Author: Sai Proficient Resaerch

5. How Can P2p Lending Disrupt Msme Sector In India
Author: Lipin Attapatu

6. Is Invoice Factoring Or Debtor Finance Right For Your Organisation?
Author: Nova Cash Flow Finance

7. What Are The Features Of The Fastag?
Author: Neha Sharma

8. Making The Most Of Your Forex Card On Your Travels
Author: Neha Sharma

9. Easy Steps To Open A Fd Account Now
Author: Neha Sharma

10. What Are The Types Of Deposits Available In India Today?
Author: Neha Sharma

11. Features Of The Nre Account And How It Can Benefit You
Author: Neha Sharma

12. How To Manage Your Education Loan Emi’s?
Author: Neha Sharma

13. Gold Loan: Why It Is A Popular Option In India?
Author: Neha Sharma

14. The Ideal Guide To Choosing The Best Insurance Policy
Author: Neha Sharma

15. How To Qualify For The Best Business Loan?
Author: Neha Sharma

Login To Account
Login Email:
Forgot Password?
New User?
Sign Up Newsletter
Email Address: