COVID Crisis: Ways to Reduce Your Home Loan EMI Payments

Home Loan EMI Payments

The COVID-19 pandemic led to a general drop in income levels. As a result, people are cutting down on discretionary spending and finding it hard to repay loan EMIs. However, not paying the home loan EMIs can make you a defaulter, a tag that no borrower ever likes.

If COVID-19 has left you worried about your home loan EMIs, then here is the solution. This article gives you the five best ways in which you can reduce your home loan EMI payments and avoid the defaulter tag.

The Top 5 Ways to Reduce Your Home Loan EMIs

The following are the top 5 ways to reduce your home loan EMIs:

  1. Extend the Loan Tenure

When you approach an Indian lender to apply for a home loan, they would most often advise you to choose a longer tenure, as a long tenure means lower home loan EMIs. Still, some borrowers choose shorter tenure, as that allows them to repay the loan earlier.

In case a short tenure home loan is making you worried, talk to the lender and increase the loan tenure. Increasing tenure can help you to lower the net EMI. You may also check a home loan EMI calculator to figure out the amount you may save by increasing or decreasing your EMI.

2. Make Part Pre-Payments When You Can Afford To

If you are an individual borrower and your loan is on the floating rate of interest, then you can make part prepayments for free. If, however, your interest rate is fixed, you might have to pay a nominal fee for making part prepayments.

By making part prepayments, you can lower down the EMI burden. Use the extra cash you have in your hand to avail this feature and reduce your monthly charge.

3. Enhance the EMI Amount Every Year

Many lenders allow you the option to increase your EMI at periodic intervals. If you work in an organization that gives regular appraisal, then you may use a part of the appraisal amount to increase your EMIs. However, to avail such a benefit, your loan has to be on a floating rate of interest.

Although enhancing the loan amount may increase your monthly outflow, it can benefit you in the long run.

4. Convert the Individual Home Loan to a Joint Home Loan

When you avail a loan in your name, the EMI may seem like a burden. However, by converting an individual home loan to a joint home loan, you can reduce your monthly outflow.

Availing a joint home loan has two benefits. Firstly, it lowers your financial burden. Secondly, it acts as a cushion in case your financial condition deteriorates.

5. Negotiate the Rate of Interest with Your Lender

If you are finding it hard to repay your loan EMI, then you can negotiate with your lender and request them to reduce the interest rate. But, this would apply to you only when you are on a floating rate of interest.

Often, lenders are slow in passing on the benefits of a reduction in interest rate. As a prudent borrower, you must keep an eye on the latest loan-related circulars of RBI and talk to your lender accordingly.


While a home loan can fulfil your dreams of owning a house, not paying the EMIs on time can affect your credit score, which, in turn, can tarnish your financial reputation.

Use PNB Housing Finance’s Home Loan EMI Calculator to stay better prepared.