As a home brings with itself a plethora of privileges, having it gives a different feel altogether. Since the property prices are going skywards, you may not be able to fund the home purchase on your own, bringing a loan into the equation. Even though the accessibility to home loans has grown manifold up with many lenders offering the same, not every lending partner can be a true ally to you. And so, a reliable lender such as LIC Housing Finance should be the call of the day.
To check how much will it cost you there, a glance at LIC home loan EMI calculator will help you do so. Let’s check out the calculator and its function in this article.
How Should You Go About LIC Home Loan EMI Calculator?
The calculator is a simple tool that only asks you three things before it shows you the repayment summary. These are the loan amount, the rate of interest and tenure. Just enter these to compute the EMI, involving a portion of both interest and principal towards a loan. LIC home loan interest rate comes at 8.45%-8.90% per annum. Plus, the loan can be availed for a maximum of 30 and 20 years by salaried and self-employed borrowers, respectively. You can also check the amount of interest liability over the chosen period.
Should You be Flexible with Tenure?
There’s no fun servicing the debt for long and pay a lot of interest which can be saved with a shorter tenure. Being salaried, you could think of having LIC home loan for 30 years, only to regret later on by letting a massive amount of interest going from your bank balance over such a debt course. A shorter tenure would increase the EMI outgo but interest is likely to be reduced greatly.
So, check your income and the expenses you have to make apart from the loan EMI and figure out a tenure that can be compatible with your budget. So, if you were for 30 years, get it down to 25 and see whether the proposed hike in the EMI can come to your budget or not. If so, go for 25 years and save precious interest which would otherwise go to the lender’s bank balance out of yours.
A Close at the Amortization Schedule
While using the EMI calculator, you can get a view of the amortization schedule as well, adjacent to or below the EMI result. The schedule will take you through to the year-on-year principal and interest repayments besides letting you know the outstanding loan balance at the end of every year. This gives you a chance to restructure the loan maybe not now but later on. Yes, prepayment can be made to get free of the interest burden. For that, you must first set the year by which you can do so from your savings. Creating surplus money overnight is next to impossible. So, you need to keep on saving regularly to attain a surplus money to pay off the loan much before it would end otherwise.