Top 5 Tips to Save on Your Loan EMI
Looking to reduce your loan burden? Here are five practical tips that can help you save money on your EMIs and manage your loans more effectively.
Make a Larger Down Payment
The bigger your down payment, the smaller your loan amount. This directly reduces your EMI and total interest outgo.
Example:
₹50,00,000
20% Down:₹10,00,000
30% Down:₹15,00,000
Monthly Savings: ~₹4,000 (at 8.5% for 20 years)
Opt for a Shorter Loan Tenure
While longer tenures mean smaller EMIs, they result in significantly higher interest payments.
Compare:
Loan Amount:
₹40,00,000
Interest Rate:
8.5%
20 years interest:₹42,50,000
15 years interest:₹30,20,000
Total Savings:₹12,30,000
Compare Interest Rates
Even a small difference in interest rate can lead to significant savings over the loan tenure. Always compare multiple lenders.
Consider Balance Transfer
If you find a significantly lower interest rate, transferring your loan balance could save you money. Calculate the break-even point including transfer fees.
Make Extra Payments
Use bonuses or savings to make prepayments. Even small additional payments can significantly reduce your interest burden.
Pro Tip 💡
Use our EMI calculator to compare different scenarios and find the best combination of tenure and EMI that works for you.