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EMI affordability: When does an ‘affordable monthly payment’ become unaffordable? Experts explain
Mint 2 hrs ago·5 Sept 2026, 2:29 am
A manageable EMI is about more than a low monthly payment. Experts explain the 30% EMI rule, debt risks and how borrowers can assess loan affordability while protecting savings and financial security. Seeking professional guidance is a must when faced with financial hardships.
For investors, this highlights the importance of a borrower's financial health. High debt-to-income ratios can lead to defaults, negatively impacting banks and financial institutions. A borrower's ability to repay is a key factor in assessing credit risk.
Watch for indicators of rising delinquency rates and credit growth trends. If borrowers are over-leveraged, it could signal stress in the broader economy, which may lead to higher provisions for banks and affect their profitability.
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