After learning a thing or two about home loan EMI, housing loan interest rates and home finance, you get to decorate your house, host parties, and make endless trips to the hardware store. But along with these joys come some not-so-fun responsibilities, such as paying off your home loan. But what if we told you that you could pay off your home loan faster and save some money in the process? Enter home loan prepayment.
Home loan prepayment allows you to pay off your home loan before the due date, thereby reducing your overall interest payment. And with the help of a home loan prepayment calculator, you can calculate how much you can save by prepaying your home loan. So, without further ado, let’s dive into the world of home loan prepayment.
What Is Home Loan Prepayment?
Before we get into the nitty-gritty of home loan prepayment, let’s first understand what it is. Home loan prepayment is the act of paying off your home loan before the due date. This can be done in part or in full, depending on your financial situation.
Why Prepay Your Home Loan?
The primary reason to prepay your home loan is to reduce your overall interest payment. When you take out a home loan, you’re not just borrowing the principal amount, but also paying interest on it. The longer the tenure of your home loan, the higher the interest payment. By prepaying your home loan, you can reduce the interest payment and save some money in the process.
Another reason to prepay your home loan is to reduce your financial burden. If you have the financial capacity to prepay your home loan, it can give you peace of mind and reduce your stress levels.
Final Thoughts
Prepaying your home loan can save you a considerable amount of money in the long run. With the help of a home loan prepayment calculator, you can calculate how much you can save and decide whether partial or full prepayment is right for you. Just make sure to keep the tips mentioned above in mind and consult a financial advisor if needed. Happy prepaying!
