If you want to buy a property, you can do so with a Home Loan offered by banks and other financial institutes. Today, you can apply online on your preferred lender’s website. But while it is easy to get a loan, repaying them is a challenge. You should make sure that you do not default on loan repayment. There are ways for doing so:
Restructuring the loan
Housing Loans generally lasts for 20 years to 30 years. This means you can never truly prepare for unpredictable scenarios like illness, accidents, employment loss, etc. In such circumstances, you might find yourself unable to pay the monthly instalments. For avoiding defaulting on the loan, approach your lender and explain the case with document proofs. The lender may decide to restructure your loan and provide additional time until you can repay the loan.
Pay additional EMI yearly
When you apply for Home Loan, lenders generally open a Loan Account to deposit the sum towards the repayment. Usually, you need to pay 12 equated monthly instalments yearly – one for each month. However, considering the mentioned unexpected issues, you can deposit additional EMIs towards the loan annually. The extra EMI not only prepares you for the time when you are inching closer to defaulting but reduces the overall loan cost.
Ask for a grace period
House Loans are long-term. This means you forge an association with the lender for a longer period. If you have repaid the previous EMIs timely, you can approach them for providing a grace period whenever you sense defaulting. Most lenders are empathetic towards the situations like medical emergencies, financial problems, illnesses, etc., that results in defaulting EMI payments.
They consider your problems and accept the request so that you do not default. However, lenders might charge a fee for the same.
Top-up loans
There are times when the loan terms change significantly when the Reserve Bank of India revises the interest rates. The sudden change in interest rates affects your EMIs. Then, approach your lender and ask for a top-up loan. Opting for these enables you to comfortably repay without worrying about increased EMI while your tenure might get extended.
Consider repayment methods
The other way to not default on Home Loan in India is coming up with other means of repayment. There are alternatives like Personal Loans, Loan Against Property, Gold Loan, or Insurance against the Policy. While it is best to take another loan, this is ideal for the short term, especially when facing a cash crunch.
Repaying loans timely is essential. It makes sure your credit ratings remain unaffected, and you get future loans with ease. Hence, never delay EMI payments.
