Should you choose lower EMI or lower interest rate while taking home loan?

Besides comparing interest rates offered by different players, also compare the processing fee, as this will make a difference to the total cost of your loan

Sanjay Kumar Singh
Last Updated at December 15, 2019 21:19 IST

Should you choose lower EMI or lower interest rate while taking home loan?

Loan tenures can go up to 30 years. Give thought to the tenure of home loan you opt for
On a home loan of Rs 50 lakh taken at an interest rate of 8.5 per cent for 20 years, your EMI will be Rs 43,391.
Your total interest cost over the tenure of the loan will be Rs 54,13,879.
If you extend the loan tenure to 30 years, your EMI will become a more affordable Rs 38,446.
However, your interest cost over the loan tenure will rise to Rs 88,40,443.
In other words, your interest cost will increase by Rs 34,26,564
Besides comparing interest rates offered by different players, also compare the processing fee, as this will make a difference to the total cost of your loan

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