5 Smart Ways To Prepay Home Loans

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A home of our own is one purchase where you will
end up spending most of your time.
Your family will grow here and so will you!
Everyone wants to have a house of their own, and
to get there, a home loan emerges as an integral
part.
Taking a home loan is important, but it is even
more important to clear this loan as soon as you
can!
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Lets assume that you have taken a loan for the
maximum tenure.
You would surely want nothing more than to clear
it as soon as you can, which is possible if you
plan well!
Do you plan on spending all of the 30 years in
paying back your home loan?
Here are a few tips you can use if you are
planning to take a home loan
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Go For A Loan That Allows Part Payments
The loan you receive at one point is based on
your income creditworthiness at that particular
time.
But we all know that over a period of time, your
income will increase so will your
affordability.
Look at those banks that offer a prepayment
feature so that you can make more than the
monthly installment when possible.
Even if you take up a loan for the maximum
tenure, you will be able to repay more over a
period of time finish the loan before its
tenure.
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Increase Your EMI Amount As Your Salary Increases
As your salary will grow over a period of time,
make sure that you increase the loan EMI as well.
If you contact your lenders, they will be able to
help you in restructuring your loan as per your
current salary.
This will reduce the tenure and interest rates
too.
This will also help in boosting and strengthening
your creditworthiness.
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Invest Specifically With The Aim To Prepay The
Loan
When you start planning to take a home loan,
understand that you must have some money set
aside to make the down payment.
In addition, if you go for a loan with prepayment
features, then you can divide your investments
accordingly.
Your investment plan corresponds to specific
goals. So, make sure one of them is clearing
your home loan.
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Plan A Mutual Fund To Prepay Your Home Loan
If you start investing in SIPs early on, they can
help you accumulate a great sum of money over a
period of 15 years or so.
If you start by investing Rs. 3000 each month for
15 years, you will have a good sum of money at
the end.
In addition, mutual fund investments can help you
save on taxes too! So, it is a double profit for
you to invest in mutual fund SIP.
Even if you go for a loan tenure of 30 years, you
can use this chunk to clear off a considerable
amount of your home loan. This could cut your
tenure by approximately 10 years.
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Direct Your Bonuses Other Income Towards The
Prepayment
There are chances that you have other sources of
income as well. It could be rent or other
variables from work.
This extra income can also be directed towards
clearing your home loan. You may receive a bonus
from work as well.
Any extra money that you receive in the year can
be directed towards your prepayment.
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A handy tip is that you start your research
early, identify the price range that you are
looking at and shortlist the property you would
want to invest in.
This will give you a good buffer time to prepare
for the down payments as well as arrange your
loan EMIs.
Prepaying your home loan will not only relieve
you from a major financial burden, but it will
also give you space to plan for other financial
milestones.
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When you begin planning for a home loan, the
first step should be to Check Your Credit Score
in order to understand your next steps. So, pull
out your CRIF Credit Report move a step closer
to your dream home.
https//cir.crifhighmark.com