5 Tips for repaying your home loan faster

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tierra mallorca rgJ1J8SDEAY unsplash

A home loan is a liability that can saddle you for a long time. A typical loan can go on for anywhere between 15 to 25 years and sometimes even longer. However, since the interest is directly proportional to the tenure of the loan, it is in the borrower’s interest to manage and repay a loan within the desired tenure.

Here are some ways to pay off a home loan quicker and subsequently pay lower interest too: 


Fix a budget that would be affordable throughout the tenure of the loan. People often stretch their budgets while buying a home, which increases their loan tenure and interest amount. A comfortable budget can keep the interest amount in check. Moreover, since income grows faster than the home loan interest rates, the chances of repaying the loan within the stipulated time are high. 

Lower tenure

Opting for a lower tenure and higher EMIs also works in favor of the borrower. When RBI cuts down the repo rate, it soon reflects in loan rates. At this time, the lender gives two options to the borrower – lower EMIs with the same tenure or the same EMIs with shorter tenure. It can help to opt for the latter, as the loan would be paid off quicker than before. For every 0.5% fall in interest rates, EMI tenure reduces by approximately 4%.

Partial prepayments

Making partial prepayments is another way to help pay off a home loan quickly. Look for lenders who offer this option as there is no penalty for prepayment with fluctuating interest rates. Paying a substantial part of the loan before schedule brings down the outstanding amount. This, in turn, also brings down the EMI tenure and interest amount. 

Keep the EMI under check

Regularly check on the EMI amount with an EMI calculator. Being well aware of the remaining balance amount and changing interest rates can help maintain financial discipline. This helps to promptly pay off all dues.

Leasing other properties

Another unconventional method to bring down the home loan interest rate and the remaining balance is by leasing another property or enlisting it as collateral against the home loan. Lenders are more comfortable lending money on a significantly reduced interest rate in the presence of collateral. If the opportunity is there, you should always opt for this.


All in all, you should do ample research and be fully aware of what you are signing up for before you zero down on a home loan. An informed decision at the beginning can make the loan journey easy, so it does not seem like a financial burden.


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