Question 1

What is EMI and how is it calculated?

Accepted Answer

EMI stands for Equated Monthly Installment. It is calculated using the formula: EMI = P × r × (1 + r)^n / ((1 + r)^n - 1), where P is the principal, r is the monthly interest rate, and n is the tenure in months.

Question 2

What is the difference between Reduce EMI and Reduce Tenure?

Accepted Answer

Reduce Tenure keeps your EMI the same but shortens the loan duration, saving maximum interest. Reduce EMI keeps the tenure the same but lowers your monthly EMI, providing cash flow relief.

Question 3

How much can I save with home loan prepayment?

Accepted Answer

On a ₹50 lakh home loan at 8.5% for 20 years, quarterly prepayments of ₹1 lakh with Reduce Tenure can save over ₹20 lakhs in interest and reduce tenure by 8-10 years.