What Is Pre-EMIInterest InHome Loan?

Pre-EMI is a term commonly usedin the context of home loans orother types of long-term loans,particularly in India.

It is payable every monthfrom the date of eachdisbursement up to thedate of commencementof EMI.

However, many banks offer aspecial facility whereby customerscan choose the installments theywish to pay for under constructionproperties till the time the propertyis ready for po

Anything paid over andabove the interest by thecustomer goes towardsprincipal repayment.

The customer benefitsby starting EMI paymentearlier and hence,repays the loan faster.

The pre-EMI paymentsare typically lower than theregular EMI payments, whichinclude both the interest andprincipal components ofthe loan.

Once the full loan amountis disbursed, the regularEMI payments begin, whichinclude both the principaland interest components.

Some banks also offertheir customers flexiblerepayment options. Here,the EMIs are unequal.

Pre-EMI interest is payableevery month from the date ofeach disbursement up to thedate of commencement of EMI.

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