6 Ways to Reduce Your Home Loan Interest_banner_WC

Banner-Dynamic-Scroll-CockpitMenu_HomeLoan

6 Ways to Reduce Your Home Loan Interest_WC

4 min 20 Mar 2024
Tips to Reduce Your Home Loan Interest Burden
Highlights:
  • Tips to Reduce Home Loan Interest Rate
  • Types of Interest Rates

Home Loan interest rate is one of the key components that determine the feasibility of your loan. Low Home Loan interest rates keep EMIs on the lower side and may help in building an asset in a convenient and stress-free manner. In this article, we will share with you some tips on how to reduce Home Loan interest rates and also explain the types of interest rates. 

Tips to Reduce Home Loan Interest Rates

1. Research for the best deals on Interest Rates

Engaging with multiple lenders when seeking a housing loan can be beneficial. While interest rates may not vary significantly across lenders, opt for a lender offering the lowest interest rate along with favourable terms, a flexible repayment tenor, and feasible processing fees for a seamless loan experience.

2. Maintain a Good Credit Score

A good score, typically above 750, makes you a creditworthy and reliable borrower and increases your chances of securing better loan terms and conditions. To maintain a good credit score, clear EMIs on time, pay all credit case bills on time, clear all and not just the minimum due on your credit card and check your credit report for errors from time to time.  

3. Opt for a Home Loan Balance Transfer

Lastly, if you think your current EMIs are not feasible for you, you can opt for a Home Loan Balance Transfer. A Home Loan Balance Transfer is a facility that allows borrowers to transfer their pending Home Loan balance from their current lender to another lender offering them lower interest rates and added benefits such as a Top-up Loan. Sometimes, a Home Loan Balance Transfer involves a processing fee and therefore, one must avail of this facility only after proper financial planning. Further, this option helps borrowers save maximum interest when availed of during the early years of the loan tenor.  

People Also Read: Home Loan Balance Transfer Process 

Types of Interest Rates Offered by Lenders in India

There are majorly two ways in which interest is offered in India – fixed and floating. Let us understand both of them.

1. Fixed Interest Rate

Under a fixed interest rate regime, the Home Loan interest rate offered to a borrower does not change with changing market conditions and stays constant during the tenor of the loan until reset by the lender. The biggest advantage of opting for this type of interest rate is that it makes financial planning easy. Since a borrower knows their monthly EMI in advance, they can adjust their other expenses and monthly finances to accommodate the EMI amount each month.

2. Floating Interest Rates

Floating interest rates on Home Loans depend on external market conditions – when Home Loan interest rates go up, the applicable interest rate goes up. The opposite is also true - when Home Loan interest rates go down, your interest rate will reduce. Though with floating interest rates your interest rate changes with the fluctuation in the interest rate, they are cheaper than fixed interest rates, which can be a great advantage.  

People Also Read: Difference Between Fixed and Floating Interest Rates 

Final Words

The interest rate on a Home Loan is an important factor as a low interest rate can save you on the total interest outgo throughout the repayment tenor. Choose a loan tenor and monthly payment that will work best for your financial situation. You may also use our housing loan EMI calculator to determine this. Follow the tips shared in this article to avail yourself of the lowest interest rates on your Home Loan.     

Blog-Intro-Disclaimer

DISCLAIMER:

While care is taken to update the information, products, and services included in or available on our website and related platforms/websites, there may be inadvertent errors or delays in updating the information. The material contained in this website and on associated web pages, is for reference and general information purposes, and the details mentioned in the respective product/service document shall prevail in case of any inconsistency. Users should seek professional advice before acting on the basis of the information contained herein. Please take an informed decision with respect to any product or service after going through the relevant product/service document and applicable terms and conditions. Neither Bajaj Housing Finance Limited nor any of its agents/associates/affiliates shall be liable for any act or omission of the Users relying on the information contained on this website and on associated web pages. In case any inconsistencies are observed, please click on contact information.

Asset Publisher

Trending Articles
alt
home+loan Home Loan

[N][T][T][N][T]

Advantages for First-Time Home Buyers
2023-07-14 | 4 min
alt
loan+against+property Loan Against Property

[N][T][T][N][T]

Top Benefits of a Loan Against Property Over Collateral-Free Loans
2024-01-09 | 4 min
alt
home+loan Home Loan

[N][T][T][N][T]

All About Home Loan Balance Transfers
2024-06-04 | 4 mins
alt
home+loan Home Loan

[N][T][T][N][T]

All You Need to Know About Home Loans
2023-01-19 | 5 min
alt
loan+against+property Loan Against Property

[N][T][T][N][T]

Understanding the Fees and Charges on Your Loan Against Property
2024-02-16 | 8 min
alt
loan+against+property Loan Against Property

[N][T][T][N][T]

3 Different Loan Against Property Types You Should Know About
2024-02-13 | 5 Min
alt
home+loan Home Loan

[N][T][T][N][T]

6 Ways to Reduce Your Home Loan Interest
2024-03-20 | 4 min
alt
home+loan Home Loan

[N][T][T][N][T]

Benefits of a Home Loan
2023-02-20 | 4 min
alt
home+loan Home Loan

[N][T][T][N][T]

Home Loan Burden Management: Five Tips
2022-06-27 | 3 min
alt
home+loan Home Loan

[N][T][T][N][T]

How to Pay Off Your Home Loan Quicker
2024-03-11 | 4 Min
alt
loan+against+property Loan Against Property

[N][T][T][N][T]

Things to Do If Your Loan Against Property Application Gets Rejected
2023-02-14 | 5 min
alt
loan+against+property Loan Against Property

[N][T][T][N][T]

Pay-off Your Debt with Bajaj Housing Finance Loan Against Property
2024-02-14 | 5 min
alt
home+loan Home Loan

[N][T][T][N][T]

Types of Home Loan Charges
2024-01-22 | 3 Min
alt
loan+against+property Loan Against Property

[N][T][T][N][T]

A Guide to Loan Against Property for Doctors
2022-06-27 | 5 Min
alt
loan+against+property Loan Against Property

[N][T][T][N][T]

Loan Against Property for Doctors: Interest Rates and Charges
2023-11-24 | 6 Min
alt
loan+against+property Loan Against Property

[N][T][T][N][T]

Short vs. Long Loan Against Property Tenor - Which Is Better?
2024-05-07 | 4 min
alt
loan+against+property Loan Against Property

[N][T][T][N][T]

Understanding the Fees and Charges on Your Loan Against Property
2024-04-10 | 6 min
alt
loan+against+property Loan Against Property

[N][T][T][N][T]

Easy Ways to Pick the Right Loan Against Property Tenor
2024-05-14 | 3 min

Call_And_Missed_Call

RHS-insurance-ad-card