The idea of being terminated from one’s job and losing one’s means of income inflow is enough to make anyone frightened, especially if the termination comes as a full and total shock to the employee. The sudden and unanticipated loss of a person’s normal source of income can be a substantial challenge when it comes to the management of already existing debt repayment obligations. When compared to other financial obligations such as a vehicle loan or personal loan, 40 lakh home loan EMI typically represent the largest amount of an individual’s overall debt repayments. This is especially true in the case of 50 lakh home loan EMI.
Therefore, in the event that you, too, have been laid off from your job, the following are some productive tactics that may be utilised to deal with your EMIs on a monthly basis.
Requesting an extension of the loan’s term from the lender
Even though the home loan’s interest rate is quite low, losing your work disrupts the flow of revenue into your household, making it almost likely impossible for you to continue making the regular monthly mortgage payments. Problems could occur very rapidly if you did not include these loan repayments or EMIs in your emergency fund. It is in your best interest to inform your lender in detail of your current financial situation and ask for a lengthier loan repayment time.
To calculate the reduced monthly instalment payments that will result from this, use the Home Loan EMI Calculator. If the loan were taken out for a longer period of time, the 40 lakh home loan EMI would be lower. This would be beneficial and could prevent the borrower from defaulting on the loan in cases where money is tight. You may also use a housing loan EMI calculator to confirm the 50 lakh home loan EMI calculation.
In order to lower the overall interest expense, you should try to repay the loan if you have extra cash in the future. It’s important to keep in mind that lengthening the loan’s term will increase the overall amount of interest owed.
Put your emergency fund to use.
If there are no other options and you used a home loan EMI calculator and discovered that you still have a long tenure and an outstanding amount to pay, then you should spend your emergency funds as soon as possible.
If you have been diligent in keeping an adequate emergency fund that is at least six times your mandatory and recurring expenses, including home loan EMIs being paid by one of the most affordable lenders in the form of home loan interest rate, then this fund may be able to protect you from a precarious financial situation like an unanticipated loss of employment. Since a single day’s delay in your 50 lakh home loan EMI payment might negatively impact both your credit score and your credit report, it would be better to utilize the money kept in your contingency fund to repay your home loan EMIs until you find another job. Once your regular income returns, your main aim should be to rebuild your emergency fund so that it can continue to be sufficient for both current and any future emergencies.
requesting a grace period
You can request a grace period from your lender if you are experiencing trouble making your monthly instalment payments (EMIs). The lender may provide you a grace period, which is a limited suspension of your loan repayments, if losing your job has put you in a tough financial situation. No 40 lakh home loan EMI payments will be required during this period in order to give the borrower time to find a new employment and pursue rehabilitation. You will be able to resume mortgage payments as soon as you secure a new position and can cover your expenses. The lender may use the Home Loan EMI Calculator to determine how your EMI can change after restarting the payment after some time because the interest component may still be calculated during the delay, which can increase your EMI.
Continue to liquidate your low-yielding investments.
One of the first and most important steps home loan borrowers can take when they are having trouble paying their 40 lakh home loan EMI due to a job loss is to find fixed-income assets that are not designated for any important financial goals.
In the long run, they typically produce returns that are lower than those generated by other forms of assets, such as equities, however this is not always the case. In addition to this, the interest rates that are normally imposed on home loans tend to be far higher than the profits that are generated from investments of this kind.
Therefore, redeEMIng such fixed-income assets can assist you in avoiding predicaments when you are unable to make 50 lakh home loan EMI repayments and, more importantly, it can assist you in avoiding a potential home loan default. This is because you can use such redemptions to get out of circumstances where you are having trouble paying your large EMIs. Before selling your low-yield investments to cover your EMIs, don’t forget to use the home loan EMI calculator to calculate how much of the outstanding loan balance will remain over the course of the loan’s remaining term. You can therefore plan ahead and allocate a certain percentage of your investment portfolio to the loan until your income resumes its typical level.
If you can, switch lenders.
Homebuyers who are having trouble making their monthly instalment payments (EMIs) on their current mortgages might consider switching to a new mortgage lender and transferring their amount to that new lender. To determine the predicted change in EMI, first utilise the 40 lakh home loan EMI calculator. Then, it is advisable to examine a number of candidates before selecting a specific lender based on a variety of criteria, such as the interest rates offered, the maximum loan term, any related processing fees, etc.
