Negative impactEconomy
Home loan of ₹30 lakh, ₹50 lakh or ₹1 crore: Higher EMI or longer tenure—Here's what works better. Calculation explained
Mint 2 hrs ago·20 Oct 2026, 8:43 am
Following the Reserve Bank of India's recent repo rate hike, banks have increased their lending benchmarks, making home loans more expensive. This change directly impacts borrowers, who now face a choice between paying a higher Equated Monthly Installment (EMI) or extending the loan tenure to keep monthly outflows manageable. The decision depends on your current financial capacity and long-term goals.
For a ₹30 lakh loan, extending the tenure from 20 to 30 years reduces the monthly burden but significantly increases the total interest paid over time. Conversely, opting for a higher EMI shortens the loan period and saves on interest, though it requires a stronger monthly cash flow. Investors should evaluate their disposable income and future financial commitments before choosing a repayment structure.
Excerpt from Mint
After the RBI raised repo rate by 25 bps to 5.50%, several banks hiked lending benchmarks, making home loans more expensive. Borrowers can raise EMIs or extend repayment periods, we illustrate how both compare for ₹ 30 lakh, ₹ 50 lakh, ₹ 80 lakh or ₹ 1 crore home loans… The Reserve Bank of India 's Monetary Policy…Read the original at Mint
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