Tenure of Home loan

It ranges from 5 years to 30 years. While deciding on the loan tenure, certain factors need to be considered. The most important factor (MIF) in deciding home loan tenure is net disposable income. Net disposable income is the money that you are left with after paying for all the deductions like PF, ESI, Gratuity and Taxes. From this net disposable income the EMI is served every month. If you have a low net disposable income, long loan tenures may suit you fine. But be aware in such a case, though the EMI would reduce, you would be paying interest for a longer period of time. A loan with a shorter tenure would bring with it payment of lesser interest, but of course a higher EMI. Also while deciding tenure things which should be kept in mind are stability of Job, chances of promotion or increment, continuity of income, etc.

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