Finance

How Does ICICI Home Loan Interest Rate Impact Your Monthly Installment?

So you are mulling to take a home loan from ICICI Bank because of its track record of servicing customers efficiently for a long time. But before making a decision, it would be worthwhile to have a look at ICICI home loan interest rate. It’s because of the fact that rates decide to a great extent the repayment capability you are going to have. So, if you are unaware of the rates, you can see all that and more in this article.

What is ICICI Home Loan Interest Rate for Different Segments?

ICICI Bank offers home loans to salaried and self-employed segments consisting of both male and female borrowers. Plus, the interest rates would differ on the basis of the quantum of finance. The bank offers a loan of up to 30 lakhs at 8.55%-8.60% to salaried and 8.65% to self-employed. As the loan goes past 30 lakhs to range up to 75 lakhs, the interest rate applicable would be 8.65%-8.70% and 8.70%-8.75% per annum for salaried and self-employed, respectively. While the salaried get a loan above 75 lakhs at 8.70%-8.75%, self-employed have to service the same at 8.75%-8.80% per annum.

Function of ICICI Home Loan EMI Calculator Unfolds

Now that the interest rate details are out, you can use the EMI calculator that shows the results of the former in the best way. What does ICICI home loan EMI calculator do is to take into account the amount of loan, tenure and rate of interest to compute the EMI, which can be extended as Equated Monthly Installment. In addition to the installment, you also know the amount of interest that’s going to be paid for the time you take a loan. Let’s be told that the EMI constitutes both principal and interest portions and so the calculator estimates the total interest besides showing the monthly installment payments.

What Should be the Tenure of ICICI Home Loan?

ICICI Bank offers a home loan for a maximum of 30 years, resulting in the reduction of EMI with such a long tenure. But that won’t be the right way to approach a home loan as a long tenure can so easily lead you to pay a heavy chunk of interest which can be easily saved going with a shorter tenure. If you are going for a 25-year loan, better go for a 20-year period to save on the interest. Yes, the shorter tenure would raise the amount of monthly installment but the amount of saving in the form of interest still makes the shorter tenure a better option of the two.

Can You Prepay ICICI Home Loan?

With the loan expected to span for about 20-30 years, the chances of you prepaying the same are greater provided you adhere to a savings strategy to accumulate the surplus money over time. You can invest in mutual funds, fixed deposits, recurring deposits and others to reach a figure by the time when the total outstanding balance would either come at par or remain below the savings surplus. This would help you prepay the loan and save on the interest considerably. However, the key is to know the outstanding balance on a yearly basis to decide the savings strategy you should adopt. You can, therefore, take a look at the amortization schedule, which appears either adjacent or below the results of ICICI Home Loan EMI Calculator.

 

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