How to complete home loan repayment quickly?
Having large debt obligation in life may give you sleepless nights. This congestive discomfort is especially true in the case of home loans. For most of us, a home loan is the biggest debt of life and we will be happy to close the debt at the earliest because the monthly burden of home loan EMI is not everyone’s cup of tea. Many consider prepayment of the loan is the only option to close the biggest debt of the life at the earliest. There are multiple thoughts when it comes to deciding the way of prepaying the home loan, however, one size does not fit in everybody’s approach. The decision has to be made based individual financial constraints and personal aspects. Just deciding to prepay the home loan does not help you reach the goal, preparing a way to save for prepayment without financial discomfort is key to success.
Is the decision right for you?
Prepaying the home loan is one of the good decisions when you want to close the loan. Check if it is your cup of coffee before considering it. You should take the tax benefits on home loan interest rates offered by the government into consideration before choosing prepayment option. You can avail tax benefit of 2 lakhs on the interest paid towards the home loan.
Calculate financial safety
I know that prepaying the home loan would save you large home loan interest rates. However, you should fortify financial back up by calculating different expenses like children education, medical emergency funds, backup for home loan EMI in case of job loss recurring financial liabilities if any.
Increase your disposable income
You may wonder how? Identify your stagnant money by digging deep into your financial records. Pull out the money from closing used credit card privileges, club memberships and refinancing loans with low-interest rates. After you increase disposable income, figure out how much you can prepay home loan by using Home loan comparison eligibility calculator. You can also tighten your strings to boost up your savings and also consider replacing expensive entertainment with something creative.
Raise your EMIs
There are chances that you have opted for small home loan EMI based on your income at the time of taking a home loan. A smart option is to increase your home loan EMI as your income increase, take the help of Home loan comparison eligibility calculator to figure raise your EMI to reduce home loan interest rates.
Consider partial prepayments
Prepaying the home loan at a go is not a solution that fits in all sizes. Instead, you can consider partial prepayment of the home loan to reduce home loan interest rates further and close the housing loan at the earliest.