Are You Buying a Home – Plan Your EMIs Here.

Buying a House? Plan Your EMIs First


If you consider the EMI vs rent ratio, Hyderabad is the best destination for buying a house in, according to ArthaYantra Buy vs. Rent report 2017.

What are EMIs?


Equated Monthly Instalments (EMI) – the way forward to owning your home. If you are buying a property on a bank loan, then EMI will play a crucial role in the repayment of the loan. It involves both the principal amount of loan and the interest on the loan.

Always remember, the longer the duration of the loan, the lesser is the EMI.

Other Things to Know:


  • If you are eligible for a loan, financial institutions usually limit the EMI at 40%-50% of your salary.
  • An individual’s age plays an important factor in defining the total earning years.
  • The total earning years usually determine the loan tenure too.
  • The loan tenure doesn’t exceed the retirement age unless there is a younger co-applicant involved.

Estimate the EMI Right:


To calculate the EMI right, you will need the following details from your lending bank:


  • Loan Amount – Financial Institutions provide loan up to 70%-80% of the total price of the property.


  • Loan Tenure – It’s the duration for which the loan has been granted. It can be longer or shorter depending on your capacity. As a thumb rule, the longer the duration, the lesser the EMIs.


  • Loan Interest Rate – Generally, the average home loan interest rate will be in the range of 8%- 9%. Find out the exact interest rate your lender is providing.


  • Processing Fee – Your lender will also charge a processing fee, which is calculated usually at 0.5%-1% of the loan amount.


  • Pre-Payments – This depends on you. It is optional. If you are making any pre-payment for your loan, it reduces the burden on you.


Calculate Your EMI Here:

Last updated on July 4, 2017

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