Tips to make home loan debt servicing easy

Have you borrowed the right amount?

You need to borrow judiciously to ensure your home loan cost is down to the minimum. Liquidate non-performing assets, if any.

Also, liquidate deposits where the interest rate is lower than that on the home loan. This way your total home loan amount is minimised and so is the cost associated with it.

Are you claiming all tax benefits?

There are many tax benefits associated with a home loan and ownership. They are on interest and principal repayment and also on building maintenance. You need to check with a chartered accountant to ensure you have claimed all benefits you are eligible for while arriving at your total taxable income.

Can you prepay a part every year?

You need to make a thorough analysis of your income streams and costs to arrive at the possibility to make an annual part prepayment to bring down the interest cost.

Sometimes, it maybe as simple as opening a recurring deposit account to generate a corpus needed for the part prepayment at the end of the year. Also, you can plan on an equity portfolio that can be liquidated every year for the part prepayment. Here, a bit of financial planning helps a great deal.