2019 Finance Management Tips for Home Loan - Home Loan Stories - Kotak Bank

A home loan is a gateway to invest in a prized asset called ‘home’ that has mostly appreciated in value over time. While opting for a home loan, it is important to take the financial side into account and regulate the recurring outflow of funds that manifests in the form of EMI. Here are some useful tips that will come in handy to manage your finances;

Choose the right lender

At the outset, it is important to make a thorough study of the home loan market and settle for a lender who offers you the best interest rate. An interest rate that is comparatively lesser even by a fraction can help you save considerable money.

Plan your monthly expenses judiciously

You need to meet several recurring monthly expenses. Many a time you may fall for impulsive buying and purchases that can be done without. It is advisable to control unwanted expenses and manage your resources well so that you don’t feel the pinch while paying your home loan EMIs.

Ensure timely EMI payments

Keep an adequate fund in your bank well before your EMI payment due date. If your EMI bounces due to insufficient funds, the lender will levy a penalty. In such a situation, even your credit score will diminish. You can also calculate the home loan EMIs through the home loan EMI calculator.

Choose the type of housing loan wisely

From a broad perspective, the interest rate on housing loans is classified as ‘fixed’ and ‘floating’. A fixed interest rate will remain constant throughout the loan tenure. A floating interest can change depending upon factors that impact the home loan market. In such a scenario, it is advisable to consult experts and arrive at a rational decision while choosing the type of loan.

Apply for Pradhan Mantri Awas Yojana (PMAY)

PMAY is a scheme offered by the government through which borrowers can enjoy interest subsidy on their EMIs. The eligibility of the borrower is based on his annual family income. The income slabs for PMAY eligibility are as mentioned below;

  • Economically Weaker Section (EWS) - up to Rs.3,00,000
  • Low Income Group (LIG) - between 3,00,001 to Rs.6,00,000
  • Middle Income Group - I (MIG - 1) between Rs.6,00,001 to Rs.12,00,000
  • Middle Income Group - II (MIG - II) between Rs.12,00,001 to Rs.18,00,000


A home loan, when managed well helps you to own a home without hassles. Opt for it by ensuring that you plan your finances in an organized manner. 

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Disclaimer: This Article is for information purpose only. The views expressed in this Article do not necessarily constitute the views of Kotak Mahindra Bank Ltd. (“Bank”) or its employees. Bank make no warranty of any kind with respect to the completeness or accuracy of the material and articles contained in this Newsletter. The information contained in this Article is sourced from empaneled external experts for the benefit of the customers and it does not constitute legal advice from Kotak. Kotak, its directors, employees and the contributors shall not be responsible or liable for any damage or loss resulting from or arising due to reliance on or use of any information contained herein.