There are many types of home loan repayments. We at Ruloans want to create awareness among the audience so they can decide the repayment type as per their needs. In the post “Step up and Step down Repayment Plan for Home Loan” we discussed about how a person can use two methods to repay their home loan. We have listed down 3 more ways to repay your home loan.
Fixed Installment Plan – The most basic plan is the fixed installment plan. The rate of interest is decided for the whole home loan tenure. No matter any change takes place in the market conditions, interest rate will not change. This plan is good for those who predict that the interest rate will keep increasing throughout the loan tenure.
Flexible Installment Plan – Another basic plan is a flexible installment plan. The rate of interest will change as per changes in market conditions. Hence you will be paying different EMI’s throughout the loan tenure. This plan is good for those who predict that the interest rate will keep decreasing throughout the loan tenure.
Delayed EMI Payments – Home loan with delayed EMI payments allows the borrower a small time period where they don’t have to pay the home loan EMI. The period decided changes from lender to lender. This method is good for those who aren’t in a position to pay EMI’s immediately. Few lenders in the market allow this repayment method to the borrowers. You can use the buffer period to save money till the repayment period begins.
Overall, there are many types of home loan repayments. A person must always be careful while selecting the repayment type as this is a long term relationship. Hence analyze your options and choose the best option.