25 Lakh Home Loan EMI & Interest Rate

A 25 lakh home loan is a type of financing option that you can avail of to buy or construct a house. As you can see, it represents a large amount of money, and a crucial aspect that you should pay attention to is how to repay the loan.

Typically, you will be required to make regular fixed payments, known as equated monthly instalments (EMIs), to your lender at specified intervals. These EMIs are ideally determined by the interplay of factors such as the interest rate, loan tenure, and the borrowed amount. However, failing to consider or calculate your EMIs properly can cause a massive dent in your savings and, eventually, affect your day-to-day expenses as well.

To make your homeownership journey a bit easier, Urban Money presents a detailed view of 25 lakh home loan EMI. Hereunder, we will discuss the 25 lakh home loan EMI calculator, features and benefits of 25 lakh loan EMI, fees and charges, factors affecting it, required documents, etc.

Features and Benefits of 25 lakh Home Loan

Let’s take a look at some of the key factors and benefits of a home loan 25 lakh EMI.

Get Rid of Rent

If you are someone living on rent, you are likely familiar with the challenges of rent hikes, lease agreements, or landlord issues, all of which can eat up a large portion of your income and savings. Hence, to put it bluntly, once you buy a home, you are no longer obligated to pay rent.

Long Repayment Tenure

Home loans are the only loans that offer a tenure of up to 30 years, and some lenders are even willing to extend it up to 40 years. Ideally, the longer the tenure, the lesser the EMI amount would be. By doing so, you can ultimately eliminate the risk of defaulting on your EMIs, making it easier for you to manage your repayment journey with more ease and better.

Low-Interest Rates

The average interest rate for a 25 lakh home loan EMI typically falls somewhere between 8% to 9% p.a. This rate is notably among the lowest when compared to other types of loans such as personal loans, car loans, business loans, and else. The reason behind this is that home loans are classified as secure loans, backed by your mortgaged property. This favourable context mitigates the risk for lenders, resulting in rock-bottom interest rates available in the market.

Tax Benefits

As the Indian government offers tax advantages for housing loans, you can get a tax deduction of up to Rs. 1.5 lakhs under Section 80C and up to Rs. 2 lakhs under Section 24B. Notably, You cannot claim any deduction for the pre-construction period, which is the period from the date of borrowing the loan till the end of the financial year before the completion of construction.

Appreciating Asset

An appraising asset is any asset whose value is increasing over time, and real estate is on top of that. Namely, obtaining a 25 lakh home loan enables you to buy a property today, as real estate prices usually go up in the long run, which is bound to be appreciated in future. Moreover, you have the option to sell or rent your house and potentially gain more value than what you initially paid for it, reinforcing the idea that residential real estate continues to be a profitable investment.

An Adobe Call Your Own

When you reside on someone else’s property, you are essentially subject to their terms and conditions, as your landlord may or may not impose restrictions on your personal freedom. Thus, when you own a house, you have full control and security over your property. You can make any changes you desire to your home, whether it’s decorating, renovating, or even selling it. In addition to the sense of accomplishment that comes with timely repayment of a home loan, it also provides you with a place of your own where you can live peacefully and securely with your loved ones.

25 lakh Home Loan Eligibility Criteria

Following are the common eligibility criteria for a home loan 25 lakh EMI:

• Age: Be at least 21 years old and not more than 60 years old at the time of loan maturity.
• Income: Have a stable source of income, preferably ranging from Rs 20,000 to Rs 25,000 per month.
• Occupation: Both salaried and self-employed individuals are applicable.
• Credit Score: Have a good credit score and credit history, preferably above 700.
• Residence: The applicant might be an Indian citizen.

Factors Affecting 25 lakh Home Loan EMI

Let’s take a look at several factors affecting your loan tenure.

Age

Typically, lenders require you to fully repay your home loans by the age of 60, which is the retirement age in India. Thus the younger you are, the longer your loan tenure would be, and vice versa.

EMI

EMI, which stands for Equated Monthly Instalment, is the fixed monthly payment you need to make to repay your 25 lakh home loan. Notably, the EMI amount decreases with a longer loan tenure and increases with a shorter one.

Income

Having a significant income can facilitate a higher loan amount, which may result in better terms and rates. Nevertheless, individuals with high incomes also have the option to expedite loan repayment by opting for a shorter tenure.

Credit Score

The higher your credit score, the greater the likelihood of getting approved for your loan application. Ideally, lenders view a credit score of 700 or above as favourable.

Your Existing Debts & Loans

Maintaining a low debt-to-income ratio, which means your total monthly debts should not exceed 40% of your monthly income, can have a positive impact on your 25 lakh home loan EMI.

Loan-To-Value Ratio

Having a high loan-to-value ratio, where the loan amount you request does not surpass 90% of the property value, can also impact your home loan approval and the applicable interest rate.

Interest Rate

The interest rate represents the percentage of additional money you must pay on your home loan amount. It is ultimately determined by various factors such as your credit score, income, loan amount, tenure, and more. A house loan EMI calculator can help you see the impact of different interest rates on your monthly payments.

Documents Required for 25 lakh Home Loan

Following are the general documents required for a home loan 25 lakh EMI.

• KYC Documents: PAN card, Aadhaar card, passport, voter ID card, driving licence, etc.
• Income Documents: For salaried applicants — salary slips, Form 16, bank statements, income tax returns, etc. For self-employed applicants — profit and loss account, balance sheet, business licence, registration certificate, etc.
• Property Documents: Title deeds, sale agreements, allotment letters, receipts of payments, encumbrance certificates, etc.

25 lakh Home Loan Processing Fees & Other Charges

Let’s take a look at the common fee structure you can expect on your 25 lakh Home Loan EMI:

Fee/Charge	Description	Amount
Processing Fee	A one-time charge for processing the loan application	0.25% to 3% of the loan amount + GST
Technical Assessment Fee	A charge for assessing the physical and market value of the property	Rs 1,000 to Rs 5,000 + GST
Legal Fee	A charge for verifying the legal documents of the property	Rs 2,000 to Rs 10,000 + GST
Stamp Duty	A tax levied by the state government on the property transaction	Varies from state to state, usually 3% to 10% of the property value
Registration Charge	A fee paid to the registrar for transferring property ownership into your name	Varies from state to state, usually 1% to 2% of the property value
Documentation Charge	A charge for preparing and executing the loan agreement and other documents	Rs 500 to Rs 2,000 + GST
Prepayment Charge	A penalty for repaying the loan amount before the end of the tenure	Nil for floating-rate loans; varies for fixed-rate loans
Foreclosure Charge	A penalty for closing the loan account before the end of the tenure	Nil for floating-rate loans; varies for fixed-rate loans
Conversion Charge	A fee for switching from one interest rate type or scheme to another	0.5% to 2% of the outstanding loan amount + GST
Cheque Bounce Charge	A penalty for dishonouring a cheque or ECS mandate due to insufficient funds or other reasons	Rs 500 to Rs 1,000 per instance + GST
Late Payment Charge	A penalty for delaying or missing an EMI payment	2% to 3% per month on the overdue amount

25 Lakh Home Loan EMI Calculator

Here is a list of EMIs you can expect when securing a home loan with tenures of 5, 10, 15, 20, 25, and 30 years.

25 Lakh Home Loan EMI For 5 Years

The below mentioned table showcases you the EMI for 25 lakh home loan for 5 years at 8.45% p.a interest rate.

Loan Amount	Rs. 25 Lakhs
Rate of Interest	8.50%
Loan Tenure	5 Years
EMI	Rs. 51,291
Interest Payable	Rs. 5,77,460
Total Amount Payable	Rs. 30,77,460

25 Lakh Home Loan EMI For 10 Years

The below mentioned table showcases you the EMI for 25 lakh home loan for 10 years at 8.45% p.a interest rate.

Loan Amount	Rs. 25 Lakhs
Rate of Interest	8.50%
Loan Tenure	10 Years
EMI	Rs. 30,996
Interest Payable	Rs. 12,19,520
Total Amount Payable	Rs. 37,19,520

25 Lakh Home Loan EMI For 15 Years

The below mentioned table showcases you the EMI for 25 lakh home loan for 15 years at 8.45% p.a interest rate.

Loan Amount	Rs. 25 Lakhs
Rate of Interest	8.50%
Loan Tenure	15 Years
EMI	Rs. 24,618
Interest Payable	Rs. 19,31,240
Total Amount Payable	Rs. 44,31,240

25 Lakh Home Loan EMI For 20 Years

The below mentioned table showcases you the EMI for 25 lakh home loan for 20 years at 8.45% p.a interest rate.

Loan Amount	Rs. 25 Lakhs
Rate of Interest	8.50%
Loan Tenure	20 Years
EMI	Rs. 21,696
Interest Payable	Rs. 27,07,040
Total Amount Payable	Rs. 27,07,040

25 Lakh Home Loan EMI For 25 Years

The below mentioned table showcases you the EMI for 25 lakh home loan for 25 years at 8.45% p.a interest rate.

Loan Amount	Rs. 25 Lakhs
Rate of Interest	8.50%
Loan Tenure	25 Years
EMI	Rs. 20,131
Interest Payable	Rs. 35,39,300
Total Amount Payable	Rs. 60,39,300

25 Lakh Home Loan EMI For 30 Years

The below mentioned table showcases you the EMI for 25 lakh home loan for 30 years at 8.45% p.a interest rate.

Loan Amount	Rs. 25 Lakhs
Rate of Interest	8.50%
Loan Tenure	30 Years
EMI	Rs. 19,223
Interest Payable	Rs. 44,20,280
Total Amount Payable	Rs. 69,20,280

Important Key Points to Consider While Taking a 25 lakh Home Loan

Here is a list of tips you can follow in order to decide the ideal home loan tenure for you: 

Your Repayment Capacity

You should evaluate your present and future income, expenses, savings, and investments in order to gauge the EMI amount that you can afford, ensuring it doesn’t impact your other financial priorities and goals. A general guideline is to maintain your EMI at or below 40% of your net monthly income.

Interest Cost

You should compare the interest rates and associated costs offered by various lenders for different home loan tenures. Additionally, check for prepayment charges and penalties that could be applicable if you decide to repay your loan before the agreed tenure. Notably, longer terms may feature lower interest rates but result in higher overall interest costs over the loan period, while shorter tenures may have higher interest rates but lower total interest costs.

Additional Charges

Be vigilant about processing fees, prepayment penalties, or any concealed charges that might be associated with your loan. If you have any doubts, consider contacting the lender’s representative either by phone or through a direct visit. This proactive approach can help prevent any unexpected or unpleasant surprises in the future.

Tax Benefits

You should verify the tax benefits available to you under Section 80C and Section 24 of the Income Tax Act. The maximum deduction for principal repayment is Rs. 1.5 lakh p.a., and for interest payments is Rs. 2 lakh p.a. To emphasise, opting for a longer tenure may enable you to maximise your tax benefits over time, while choosing a shorter tenure could reduce both your tax benefits and interest costs.

Tips to Minimise Your 25 lakh Home Loan EMI

Let’s take a look at certain tips you can follow to minimise your 25 lakh loan EMI.

Find the Lowest Interest Rate

An online search can easily give you the range of interest rates charged by various banks and housing finance companies. However, you need to understand that the lowest rate is not offered to all borrowers as it often comes with various terms and conditions. By doing so, you need to compare the best rate that you can get for your profile. Having a good credit score, a female co-applicant, and a salaried income can help you get a lower interest rate.

Pick the Right Property

Many lenders maintain a list of property types and locations in which they do not provide loans. If your property falls into such categories, you might encounter a higher interest rate or even face rejection of your loan application. Hence, it’s essential to consult with your lender before finalising the property. Moreover, you should avoid properties that are under litigation, have unclear titles, or have structural defects.

Arrange for a Higher Downpayment

The higher the downpayment you make, the lower your loan amount and hence your EMI. Most lenders require you to pay at least 20% of the property value as a downpayment, but you can pay more if you have sufficient funds. This will also reduce your interest cost and improve your eligibility for the loan.

Opt Longer Tenure

The longer your loan tenure, the lower your EMI will be. However, this also means that you will pay more interest over the loan period. So, it is prudent to balance your EMI affordability with your interest outgo. You can also use a 25 lakh home loan EMI calculator via the Urban Money website, one of the most trusted fintech platforms in India, to assess how different tenures affect your EMI amount.

Go for Home Saver Loans

Several lenders provide home-saving loans that enable you to deposit your extra funds into a connected savings or current account, effectively reducing your interest liability. Namely, interest is computed based on the net outstanding loan balance minus the balance in your linked account. Thereby you can cut down on interest and and also withdraw your funds whenever you need them.