Did you know, opting for a shorter loan tenure can help you save a significant corpus? By increasing your EMI slightly, a Rs 60 lakh loan for 30 years can be reduced to 25 years, helping you save nearly Rs 24 lakh and several repayment years. In most cases, individuals look for a minimum EMI option, considering their financial comfort. However, pushing your limits slightly can benefit you in the long run. On that note, we will walk you through the article to help you understand how you can save Rs 24 lakh and 5 years on Rs 60 lakh, 30-year loan; see calculations.
Home loan conditions
Here, we are discussing about Rs 60 lakh home loan. The interest rate will be 9.50 per cent and the loan duration will be 30 years.
What will be EMI on Rs 60 lakh loan for 30 years?
The estimated monthly instalment (EMI) on a 60 lakh loan will be Rs 50,451.
What will be total interest on Rs 60 lakh loan?
On this loan, the estimated interest will be Rs 1,21,62,451.
What will be total repayment amount of Rs 60 lakh loan?
On Rs 60 lakh loan, the total repayment amount will be Rs 1,81,62,451.
Impact of Loan Tenure: Long vs Short
When it comes to home loans, most people opt for longer tenures and lower EMIs to stay within their comfort zone. However, a slight adjustment to your repayment plan could save you a significant amount of money and time.
Numbers Speak: Comparing 30-year vs 25-year tenure
In a 30-year tenure, the monthly EMI will be approximately Rs 50,451, and the total interest paid over the period will be around Rs 1,21,62,451. Now, if you reduce the tenure to 25 years, the EMI increases to Rs 52,422 (just Rs 1,971 more). However, the total interest paid drops to approximately Rs 1,57,26,540.
Why choose a shorter tenure?
- Shorter tenures lead to reduced overall interest payments.
- Paying off the loan early gives financial freedom sooner.
- Enables individuals to channel funds into other investments earlier.
What will be your EMI on Rs 60 lakh loan for 25 years?
On a Rs 60 lakh loan for 25 years at a 9.50 per cent interest rate, the estimated monthly EMI amount will be Rs 52,422.
What will be your total interest on Rs 60 lakh loan in 25 years?
The estimated total interest in 25 years will be Rs 97,26,540 on a Rs 60 lakh loan.
What will be your total repayment amount on Rs 60 lakh loan in 25 years?
The total estimated repayment amount will be Rs 1,57,26,540.
How much money can you expect to save?
The estimated amount saved because of an increase in EMI will be approximately Rs 24,35,911. On the other hand, the time saved will be 5 years.
