Home Home 3 Ways to Manage the EMI of Multiple Home Loans

3 Ways to Manage the EMI of Multiple Home Loans

by Gerua Senia

In India, there are no restrictions on how many properties one can own. Therefore, it is normal for some people to own multiple properties in different cities or locations. Investing in real estate allows them to diversify their investment portfolio. Similarly, no regulation prevents people from obtaining a housing loan on different properties. However, the loan amount sanctioned for all properties combined will be determined by many factors such as your age, earnings, and ability to repay the loan.

If you have multiple housing loans and are unsure how to manage your EMIs, here is what you can do.

How to manage multiple home loan EMIs?

Once your loan is approved, the next step is to manage your monthly EMIs effectively. Here are three approaches for adequately managing your housing loan EMI.

  • Increase Your EMIs

You must have analysed your monthly liability before applying for a home loan. However, your income grows over time, and you have additional cash on hand. Therefore, rather than investing the money in various savings schemes, it is advisable to service your loan by raising your EMI payment. You can use a home loan EMI calculator to make the calculations. It is preferable to service debt with a high-interest rate first. This will save money on interest and lower your interest outflow.

Once you have paid off one of your debts, you will be in a much better position to go on to the other loan. The strategy helps you save money and enables you to get out of debt quickly.

  • Make Partial Prepayment Regularly

Most lenders do not oppose the borrower making voluntary, unplanned payments. Windfalls such as bonuses, monetary gifts, or maturity proceeds from investments should be utilised to prepay a portion of your housing loan from time to time. It would help to service the home loan you recently took on because the interest outgo is higher in the initial stage. This will help reduce your overall EMI burden and make it more manageable. 

As a result, you should take advantage of this opportunity and direct any extra income toward the repayment of your loans. Most lenders do not levy high fees for partial prepayment. Making a prepayment helps reduce your total outstanding debt and saves you money on interest payments.

  • Switch Lenders If Required

Another option to make your EMI more affordable is to apply for a home loan balance transfer facility. However, you must first check your home loan status using a home loan tracker. Now, if another lender is offering you a home loan with low-interest rates that will bring down the cost of servicing the loan, make the switch.

Lenders often lower their rates at different intervals due to various reasons. By refinancing one or more home loans, you can save money on interest by switching to a new lender with lower rates. You can use a home loan interest rate calculator to determine the benefit of changing the lenders.

Managing multiple housing loan EMIs is a challenging task. However, by following the steps mentioned above, you can reduce your overall debt and make EMIs more affordable. In the end, it all comes down to being financially disciplined and spending your money wisely.


You may also like