For many, buying a home is a cherished dream. Most of us dream of having our place where we can add our personal touch with aesthetic decor to make it truly our own. This is what many of us dream of. Suppose you decide to take a loan to buy a house that you will eventually turn into a home with love and effort. Your loan amount is Rs 75 lakh for a 30-year tenure. Imagine if you could save Rs 30 lakh and 5 years on this loan – that’s a significant saving that you’d likely want to explore. Let’s explore the details below to find out how you can achieve this.

Home loan conditions

Here, we are discussing about Rs 75 lakh home loan. The interest rate will be 9.50 per cent, and the loan duration is for 30 years.

What will be EMI on Rs 75 lakh loan for 30 years?

The estimated monthly instalment (EMI) on a 75 lakh loan will be Rs 63,064.

What will be total interest on Rs 75 lakh loan?

On this loan, the estimated interest will be Rs 1,52,03,064, considering a 9.5 per cent interest rate. 

What will be total repayment amount of Rs 75 lakh loan?

On a Rs 75 lakh loan, the total repayment amount will be Rs 2,27,03,064.

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 63,064, and the total interest paid over the period will be around Rs 1,52,03,064. Now, if you reduce the tenure to 25 years, the EMI increases to Rs 65,527 (just Rs 2,463 more). However, the total interest paid drops to approximately Rs 1,21,58,175.

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 75 lakh loan for 25 years?

On a Rs 75 lakh loan for 25 years at a 9.50 per cent interest rate, the estimated monthly EMI amount will be Rs 65,527.

What will be your total interest on Rs 75 lakh loan in 25 years?

The estimated total interest in 25 years will be Rs 1,21,58,175 on a Rs 75 lakh loan. 

What will be your total repayment amount on Rs 75 lakh loan in 25 years?

The total estimated repayment amount will be Rs 1,96,58,175.

How much money can you expect to save?

The estimated amount saved because of an increase in EMI will be approximately Rs 30,44,889. On the other hand, the time saved will be 5 years.

Also Read: Power of Rs 1,50,000 PPF Investment: How many years will it take to generate Rs 16 lakh/year tax-free income from Public Provident Fund?