On a black slate the words 'Home Loan' is written and a home image is drawn. There are yellow and white chalk pieces around.

Keeping up with the bills and monthly installments can be difficult if you haven’t planned it properly. Especially home loans tend to have long tenures and without a proper EMI (Equated Monthly Installment) plan, you may not be able to keep up with the payments.

When you default on your home loan payment, you are affected by penalties that impact your credit score. Therefore, it is important to plan your home loan EMIs to avoid defaulting on them. This simple guide will help you to plan it effectively.

A Guide to plan your home loan EMIs

If you have plans to buy a house, you should consider this guide and try to follow it. If you have other loans, then these tips will help you to pay the EMIs on time comfortably.

The following are the things you must do while planning your home loan EMIs:

  • Detailed Analysis of Your Financial Status
  • Proper Choice of Home Loan Plans
  • Try to Prepay existing debts
  • Transfer of balance home loans
  • Choose Flexi Hybrid Home Loan plans

Detailed Analysis of Your Financial Status

Before investing in properties like a house, you should know your financial status. Try to make a list of all the debts, loans, outstanding payments, etc.

You should also include your daily and monthly expenses to find out how much money you can save at the end of every month.

This will give you a clear picture of your financial status. Then you should find out whether you can afford to pay the home loan with the savings money. If not, you should consider other investments that will give your high returns in the short term.

Once you get a good hold of your finances, you should then consider what you can afford and how to go about getting a loan.

Without doing this step, you should never proceed blindly and opt for a loan. You will default on your EMIs at some point and will become a burden.

Proper Choice of Home Loan Plans

When you approach for a home loan, you have to first look into the interest rates. According to your monthly budget, choose a repayment duration and find out an interest rate that suits you.

Lenders may either have fixed rates or floating rates. Therefore, you must explore all the options and find out the best one for you.

You also make use of the EMI calculators available online to plan your monthly budget. This will help you to approach the lender with some knowledge and demand a plan as per your requirement.

Choosing the right type of EMI plan is also very crucial. Therefore, try not to make any mistakes in this step. Choose your tenure carefully and an interest rate that will not burden you.

Try to Prepay existing debts

Some of us have existing debts for which we will be paying EMI. So, adding another EMI to this list can be burdensome. Also, you may start defaulting both EMIs due to the burden

So, to avoid such issues, you can try to prepay the debt and get some relief. When you have some extra funds and you have the opportunity to complete the payment before the tenure, you shall do it.

This will allow you to opt for a fresh home loan and you need not have to restrict your other expenses to afford a new house. It will be easier for you to pay the EMI on time and prevent defaulting.

Transfer of Balance Home Loans

Sometimes you can find your existing EMI plan to be difficult. When the interest rates aren’t in your favor, you can always try transferring your home loan balance to another lender.

You can try approaching a new lender who can refinance your home at a better interest rate which doesn’t make your life difficult.

The new lender will pay your existing home loan balance and release all the documents provided to them. You can now pay the current lender and even opt for a top-up of the loan.

This way, you can reduce the monthly expense and seek another home loan comfortably. This will also increase your chances for other investments.

Flexi Hybrid Home Loan Plans

Some lenders provide you with a flexible EMI plan with their home loans where you will be paying only the interest amount initially.

Usually, the EMI amount will include the principal amount as well as the interest amount. The total due to be paid can be huge and can be difficult for you to manage.

But with the Flexi hybrid home loan, you just have to pay only the interest amount during the initial period. This means that the EMI will be very less during the start of the tenure and enables you to comfortably pay the installment.

After the initial tenure, the EMI will start to have both the interest and principal amount. So gradually you will be paying higher amounts.

This is a great plan that will help you to find out a strategy to manage your EMIs and avoid defaulting on them. You can use the initial period to sort out your finances and get a hold of your EMIs.

These are the ways in which you can plan your home loan EMIs and prevent defaulting on them. Even if they have a long tenure, this guide will help you to sort it out. Before planning to buy a new house with a home loan, consider these steps and have a fruitful investment.


Buying a house is a dream for many of us. It is not necessary to fulfill that dream by taking huge risks. With careful planning and proper techniques, you can comfortably own a house without facing any financial difficulties. This guide will help you with working out your finances, choosing a suitable home loan plan, and exploring the different options available. By following these steps, you will never default on your EMI next time.

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Page Last Updated on : 17th April 2024