Get the Tata Capital App to apply for Loans & manage your account. Download Now

Blogs SUPPORT
Loans For You
Loans for Business
Investment
Insurance
Apply
Quick Links for loans
Quick Links for Insurance
Investment
Offers Quick Pay
Back

Equipment Finance

Avail Digital Equipment Loans
up to Rs. 1 Crore

  • Attractive ROIs
  • Customizable Loan tenure
Know More
Back

Equipment Leasing

Avail Leasing solutions
for all asset classes

  • Up to 100% financing
  • No additional collateral required
Know More
Menu  
 
Apply Now

Tata Capital > Blog > Loan for Home > Top Benefits of Paying Higher Home Loan EMIs

Loan for Home

Top Benefits of Paying Higher Home Loan EMIs

Top Benefits of Paying Higher Home Loan EMIs

Can’t decide on the EMI amount you should opt for towards the repayment of your home loan? While borrowers and lenders together decide a fixed EMI sum, there is no restriction if the borrower wishes to exceed their monthly instalment amount occasionally. Lending institutions recommend that you reduce your overall ROI and better manage EMIs by paying bigger amounts. Here are a few benefits of paying higher EMIs on home loans.

Know More

Interest Savings

This is the most obvious reason to pay higher EMIs. It makes your overall home loan cheaper. Paying a higher EMI also reduces your loan tenure. Let us understand this further through the following example.

Let's say that Riya has been sanctioned a home loan by her lending institution worth Rs 40,00,000 at an annual interest rate of @ 9.25%

EMI option 1 = Rs 36,635

Loan Tenure = 20 years

-------------------------------------------

Total interest payable = Rs 47,92,322 

EMI option 2 = Rs 32,907

Loan Tenure = 30 years

------------------------------------------

Total interest payable = 78,46,526

If Riya opts for EMI option 2, she will pay a lower monthly instalment but will end up paying Rs 30.54 lakhs more towards overall interest payments on her home loan. You can use a simple online home loan calculator such as the home loan EMI calculator to calculate an EMI option that suits your pace and pocket better.

Tax Benefits

The Government of India wants its citizens to own a home rather than renting one. This is why it provides tax exemptions to all citizens who avail housing finance under Sections 24B, 80C, 80EE, and 80EEA of the Income Tax Act. Under Section 80C, a borrower can claim a rebate of up to Rs. 1.5 lakhs from their gross annual income. Whereas, section 24B increases the deduction amount to Rs. 2 lakhs. Paying a lower EMI may not allow you to exhaust set limit for tax benefits fully.

Freedom from Loan

Taking a home loan lets you buy your dream home, but it also forces you to cringe on various lifestyle expenses. Paying higher EMIs will rid you of the home loan faster, increasing your household disposable income, helping you gain more control over your lifestyle preferences, and thereby making you more stable financially. Paying a higher EMI may feel challenging at first, but watching your loan amount reduce will boost your morale.

Improved Credit Score

Most financial institutions insist upon a healthy credit score before sanctioning home loans these days. Repaying your EMIs on time improves your credit score drastically. It also makes your application stronger for future loans. A healthy credit score plays a critical role in evaluating your financial soundness. 

Over to You

Want to start paying a higher monthly instalment, but finding it hard to calculate the exact amount? Use Tata Capital’s home loan EMI calculator – the calculator is extremely easy to use. Enter in the principal loan amount, the rate of interest, and the loan tenure using sliders or via manual entry and the calculator will automatically display the EMI amount within seconds.

Want to apply for a home loan with Tata Capital? Apply for a housing loan with us and enjoy flexible EMI options at competitive home loan interest rates for all your housing finance needs. Visit our website or give us a call to know your home loan eligibility at Tata Capital today!

Apply Now
Disclaimer

Leave a Reply

Your email address will not be published. Required fields are marked *

Most Viewed Blogs

Trending Blogs

Calculator

Personal Loan EMI Calculator

Personal Loan EMI Calculator
Home Loan EMI Calculator

Home Loan EMI Calculator
Business Loan EMI Calculator

Business Loan EMI Calculator
Used Car Loan EMI Calculator

Used Car Loan EMI Calculator
Two Wheeler Loan EMI Calculator

Two Wheeler Loan EMI Calculator
Loan Against Securities Calculator

Loan Against Securities Calculator
Loan Against Property Calculator

Loan Against Property Calculator
More Tools
Our Subsidiaries
Our Other Websites

Important Information

Investor Information

Visit us on:,Visit us on: www.tatacapitalmoneyfy.com,www.tatacapitalmoneyfy.com

Our Private Equity Funds

Amalgamated Companies

Top Branches

Most Important Terms & Conditions - Home Loans

Download in your preferred language

Download

Policies, Codes & Other Documents

Most Important Terms & Conditions - Home Loans

Download in your preferred language

Download

Tata Capital Solutions & Services

Uh oh, something went wrong

Please try again later.