{"id":1249,"date":"2023-01-13T00:10:05","date_gmt":"2023-01-13T00:10:05","guid":{"rendered":"https:\/\/acerealty.co.in\/blog\/?p=1249"},"modified":"2023-12-06T10:15:47","modified_gmt":"2023-12-06T10:15:47","slug":"understanding-pre-emi","status":"publish","type":"post","link":"https:\/\/www.acerealty.co.in\/blog\/understanding-pre-emi\/","title":{"rendered":"Understanding Pre-EMI"},"content":{"rendered":"

All About Pre-EMI<\/strong><\/p>\n

Purchasing a property is a major investment and a dream for many individuals. However, property prices have steadily increased in the past years, whether it is for an <\/span>affordable 1 BHK in Thane<\/a><\/span> or <\/span>luxury apartments in Mulund<\/span>. These days purchasing a home is often made possible with the help of home loans. Knowing the best loan providers and interest rates can help you get a good deal with better repayment options. This is where the knowledge of pre-EMI and full EMI is handy. <\/span><\/p>\n

What Is Pre-EMI?<\/span><\/strong><\/p>\n

For those of you looking to invest early in <\/span>upcoming real estate projects in Thane<\/span> or other ongoing projects, opting for a Pre-EMI home loan is ideal. Pre-EMI is the monthly payment of the interest amount on the disbursed section of the home loan. This facility is only available for projects that are under construction. <\/span><\/p>\n

Here, the loan provider disburses a certain amount of the home loan at a time. The individual pays interest only on the disbursed loan amount regardless of the principal amount. This allows for huge savings and enables people on a budget to purchase <\/span>upcoming flats in Thane<\/a><\/span>. Note that the tenure of pre-EMI ends the moment the property is constructed. <\/span><\/p>\n

Example Of Pre-EMI Calculation<\/b><\/span><\/p>\n

For instance, assume a person borrows a loan of INR 20 lakhs at 6% interest for 15 years for an under-construction <\/span>residential property in Mulund<\/a><\/span>. The project is expected to be completed in 3 years during which the borrower opts for Pre-EMI. Here, the bank will not disburse the entire amount but rather a portion on which the borrower will pay interest. <\/span><\/p>\n

Let\u2019s assume the agreement is to pay INR 2 lakhs every 6 months. The interest calculation will be (disbursed amount*interest rate\/12 months). In this example, the interest will be (200000*6%\/12 months) = INR 1000. After the next payment of INR 2 lakhs, the interest will be calculated on the total disbursement value i.e. INR 4 lakhs which is INR 2000.<\/span><\/p>\n

As the disbursement amount increases, the interest increases proportionately. Unlike a full-EMI loan, here the borrower is not paying interest on the principal amount from day 1, but only the amount borrowed at a particular time. <\/span><\/p>\n

When To Choose The Pre-EMI Option?<\/b><\/span><\/p>\n