What Happens If Home Loan EMI Bounces? Know Charges & Consequences

5 min 11 Jul 2024

Highlights:

Home Loan EMI and Its Importance
Reasons for Home Loan EMI Bounce
Steps to be Taken in Case of Home Loan EMI Bounce

Meaning of Home Loan EMI Bounce

If you have ongoing Home Loan EMIs and miss a payment, perhaps because of insufficient funds or any other issues, it is categorised as a ‘bounce’. Having a bounced EMI can have a negative impact and often even results in a penalty, also known as a bounce charge.

It is important that both prospective borrowers and existing borrowers make a note of the impact that bounced EMIs can have on their finances and creditworthiness, so they can safeguard themselves against it.

What are Some Causes Behind Your Home Loan EMIs Bouncing?

Some of the reasons that may have caused your Home Loan EMI to bounce can be:

Insufficient Funds: A lack of adequate funds in the account linked to the automated EMI payments can lead to your payment bouncing.
Change in Banking Account Details: Another reason for your EMI payment not going through could be the failure to update new bank details with the Home Loan lender.
Bank-related Technical Issues: These may not be as common, but sometimes, technical glitches can also lead to your Home Loan EMI bouncing.

What are the Consequences of Home Loan EMIs Bouncing?

A bounced EMI can impact you in several ways, two of these being:

Substantial Penalties: If your Home Loan EMIs bounce you may incur additional charges and penalties for each missed payment. These charges are subject to change and therefore, borrowers should stay informed about them in advance.
Credit Score Impact: If your Home Loan EMIs bounce, it will reflect poorly on your repayment history and negatively impact your credit score, which will also impact your chances of securing a competitive loan offer in the future.

What to Do if Your Home Loan EMI Bounces?

Here are some immediate measures borrowers can consider if their Home Loan EMI bounces to avoid repercussions:

Pay missed EMI: If your Home Loan EMI bounces, you can use the Bajaj Housing Finance customer portal to pay the missed EMI.
Review bank balance and align payment dates: Ensure there are sufficient funds in your account to cover the EMI and address any balance shortages promptly. It is also a good idea to coordinate salary dates with EMI deduction dates to avoid any possibility of a fund crunch in your bank account.
Set up reminders: Setting up reminders can keep you informed about upcoming EMIs, thus preventing missed payments due to simple oversight.

How to Avoid EMI Bounce Charges?

To avoid the possibility of defaulting on your EMIs or incurring EMI bounce charges, consider:

Maintaining sufficient balance in your EMI-linked account
Monitoring payment due dates and tracking EMIs

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