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Stressed About Home Loan EMIs? Reduce The Burden With These 4 Ways
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News18•09-10-2026, 12:03
Stressed About Home Loan EMIs? Reduce The Burden With These 4 Ways
- •The Reserve Bank of India increased the repo rate to 5.5 percent, which is likely to increase lending interest rates and monthly EMIs for borrowers.
- •Instead of extending your loan tenure when rates rise, slightly increase your monthly EMI amount to repay the loan faster and save lakhs in interest.
- •Prepaying just 5 percent of the total loan amount every year using extra savings or bonuses can neutralize the impact of interest rate hikes.
- •Use a home loan overdraft facility by linking a savings account to reduce the outstanding loan balance while keeping emergency funds accessible.
- •If your CIBIL score has improved above 780, negotiate a lower interest rate with your bank or consider transferring your loan to another lender.
Key Questions Answered
On Wednesday, October 7, 2026, the Reserve Bank of India (RBI) increased the repo rate by 0.25 percent or 25 basis points, bringing it up to 5.5%.
If you prepay just 5 percent of the total loan amount every year using extra savings or a festival bonus, you can completely neutralize a 0.25 percent interest rate hike. This strategy can help shorten a 20-year loan down to 13 or 14 years while saving a large amount in interest.
Converting your home loan into an overdraft account lets you keep surplus cash or emergency funds safe while reducing your loan interest cost. The bank deducts these extra funds from the total outstanding loan, charging interest only on the remaining balance, and the money can still be withdrawn during emergencies.
