How to Make Home Loan Interest Free

For individuals in India, owning a home is more than just a financial milestone; it's a symbol of stability, security, and a cherished dream. The significance of house purchase in India cannot be overstated, as it is often considered a crucial life goal. However, achieving this dream is not without its challenges, and many individuals face hurdles on the path to homeownership.

To own a house is a costly affair and to overcome this Banks and NBFC's provide housing loans.

Loans interest are generally defined based on the cashflow of loan taking person, some factors being cosnidered such as

Source of Income

Employment base

Govt Employee
Pvt Employee

Business based

Gender
CIBIL score based

Considering above factors loan rates are defined for an individual. With an Interest rate of 8.5% Per Annum, Interest amount becomes equal to principal amount, which means an individual has to pay just double the amount of taken loan.

As mentioned in the title of article, we will help you to reduce the interest burden for this we will tell you a golden rule by which you can make your Home Loan Interest Zero. This will be achieved through making small monthly investment in Mutual Funds, Lets see, how this can be done

For calculation purpose, we have considered some assumptions

Home Loan Interest - 9.2%
Loan Period - 20 Years
Mutual Fund CAGR - 12%
Mutual Fund SIP - 0.18% of Principal Amount

Below is the table demonstrating how much SIP one should do to net off the impact of Home Loan Interest in 20 Years.

Consider different level of SIP's to be done for equal time period of loan repayment period.

For example for a 50 lakh loan, one has to make SIP of 9000/month to net off the impact of home loan interest amount of 59.51 Lakh and save approx. 1.66 Lakh at the end of 20 years along with base investment of 21.6 Lakh in mutual fund.

You can check, what's your loan amount and how much SIP is required to make Home Loan Interest Free. For any query related to above article, you can connect with us on email and phone

Deepak Rautela

V-R Investment Services

Mobile No - 9643104506

Email Id - Wealthassuranceguru@gmail.com

Please Note - Mutual Fund Investment are subject to market risk, read fund document carefully, before investing

Comments

Section 37 LIC Act 1956 - "The Extra Safety Net for LIC Of India Customers"

In the world of insurance, trust is paramount. Policyholders rely on insurance companies to fulfill their financial promises, especially during challenging times. For residents and non-residents alike, this trust is often placed in the hands of insurance giants like the Life Insurance Corporation of India (LIC). One of the critical factors that distinguish LIC from private insurers is Section 37 of the Life Insurance Corporation Act, 1956. This section serves as a robust safety net for policyholders, guaranteeing payouts even under challenging circumstances. Section 37 of the LIC Act 1956: Section 37 of the Life Insurance Corporation Act, 1956, is a provision that offers significant benefits to policyholders. It ensures that the sums assured by all policies issued by LIC, including any bonuses declared on those policies, are guaranteed as cash payments by the Central Government. This guarantee extends to policies issued by other insurers whose liabilities have vested in LIC under the A...

Reasons Why ULIP is Anytime Better than the Bank RD & Postal RD

When it comes to financial planning and investment, choosing the right instrument is crucial. Among the many options available in India, LIC (Life Insurance Corporation of India) ULIPs (Unit Linked Insurance Plans) often stand out as a versatile and potentially rewarding choice. In this blog, we will explore why LIC ULIPs are a favorable option compared to traditional investment options like Post Office and Bank Recurring Deposits (RDs). We get Bank & Post office RD with fixed interest rate, where our returns are assured after the defined time period of RD, but in ULIP it depends on the kind of fund we have selected for our self. There are 4 different kind of fund in which LIC of India ULIP deals. We will mention them in sequence of decreasing returns. Growth fund, Balanced Fund, Secured Fund and Bond Fund. To understand them in a better way, Lets look at the below table Expected Returns under different funds are as below 1. Growth - 15% with Highest risk, as maj...

Mantra for Financial Freedom - Mutual Fund

Every Independence Day, we pay homage to the brave souls who fought tirelessly for our nation's freedom. Their unwavering commitment, resilience, and enduring struggle serve as an inspiration. Just as they paved the path to independence for our country, achieving financial freedom demands dedication, discipline, and, above all, patience. By channeling these qualities into your mutual fund investments, you can embark on a journey towards long-term financial self-reliance. To set you on this transformative path, here are three pivotal principles of mutual fund investment that can lead you to financial independence: 1. Be a Visionary Investor: Picture the life you desire, where your dreams are within reach, and financial worries are a thing of the past. Now, understand that reaching this goal requires early action and unwavering commitment. Your money can start working for you from the moment you begin investing, steadily amassing substantial wealth over time. Early investments unleas...

V-R Investment Services

Search This Blog