The 20-year mark: where interest passes the loan
Look at how the interest grows with tenure on this loan. At 10 years you pay ₹9.12 lakh as interest, which is 45.59% of the loan. At 15 years it is ₹14.40 lakh. At 20 years it reaches ₹20.15 lakh, a little more than the ₹20 lakh you borrowed. Stretch it to 30 years and the interest becomes ₹32.83 lakh.
For a first flat, 15 years is often a fair middle path. The EMI goes up by ₹2,384 to ₹19,113, and you pay about ₹5.75 lakh less interest than on the 20-year plan.
Frequently asked questions
What is the EMI on a ₹20 lakh home loan for 15 years?
At 8% a year, the EMI is ₹19,113 a month for 15 years. Total interest is ₹14,40,348, so you repay about ₹34.40 lakh in all. A different rate from your lender will change these figures.
What salary do I need for a ₹20 lakh home loan?
As a rough rule of thumb, lenders usually want the EMI within about 40 to 50% of take-home pay. For ₹16,729 (20 years at 8%), that means a take-home of roughly ₹34,000 to ₹42,000 a month. Each lender has its own rules.
What is the lowest EMI possible on a ₹20 lakh loan?
Over 30 years at 8%, the EMI drops to ₹14,675. But the interest rises to ₹32,83,105, which is 164.16% of the loan. The EMI is only ₹2,054 lower than at 20 years.
How much is the EMI for a ₹20 lakh loan for 10 years?
₹24,266 a month at 8% a year. Interest over 10 years is ₹9,11,862, less than half of what you would pay over 20 years. It suits buyers with a higher or rising income.
