Want to save on interest and reduce the repayment term of your PNB home loan? Prepaying is the answer. The PNB home loan prepayment calculator allows you to see the impact of your prepayments instantly, enabling you to make better financial decisions.
This guide covers everything you need to know about the PNB prepayment calculator, including how it works, how to use it, and how prepayments can benefit you. With expert guidance from Credit Dharma, you’ll be able to plan and manage your home loan repayments effectively.
Save Lakhs on Your PNB Home Loan with Prepayments!
Why Prepay Your PNB Home Loan?
Prepayment is a financial strategy where you repay a portion of your home loan ahead of schedule. This simple step comes with a host of benefits:
| Benefit | Description |
|---|---|
| Lower Interest Costs | By reducing your outstanding principal, prepayment directly slashes the total interest payable on your loan. |
| Shorter Tenure | Prepayments help cut down your loan tenure, allowing you to become debt-free faster. |
| Reduced EMIs | If you prefer, you can opt for lower EMIs while keeping the loan tenure constant. |
| Significant Savings | Depending on your loan amount and tenure, prepayment can save you lakhs of rupees over the loan’s lifetime. |
Imagine owning your home outright years ahead of schedule—that’s the power of prepayment!
PNB Home Loan Prepayment Charges
| Charge Type | Home Loan (INR) |
|---|---|
| Part or Full Prepayment of loan (on Floating Rate of Interest)** | 1. NIL – In case the property is in the name of an Individual. 2. 2% of principal paid + GST – If the property is in the name of a Non-Individual entity |
| Part or Full Prepayment of loan (on Fixed Rate of Interest)** | 1. NIL – If the property is in the name of an Individual and the payment is made from own sources. 2. 3% of principal prepaid + GST – If the payment is made by a third party. 3. 3% of principal paid + GST – For Non-Individual entities or loans considered as business purpose loans. |
Factors to Consider Before Prepaying a Home Loan
While prepaying home loans seems lucrative, borrowers must evaluate certain aspects beforehand:
Pro Tip: If your credit score is low, consider working on it for 3-6 months before applying for a home loan.
Things to Know Before Prepaying Your PNB Home Loan
Before using the PNB home loan prepayment calculator, keep these points in mind:
| Factor | Description |
|---|---|
| Prepayment Charges | 1. Check if your loan agreement includes prepayment penalties. 2. Many loans have no charges for prepaying. |
| Liquidity Matters | 1. Ensure prepayment doesn’t leave you short of emergency funds. 2. Maintain a healthy balance between savings and prepayments. |
| Frequency of Prepayments | Decide whether to make one-time prepayments or regular lump sums based on your cash flow. |
Pro Tip: If your credit score is low, consider working on it for 3-6 months before applying for a home loan.
How Credit Dharma’s Home Loan Prepayment Calculator Works
The PNB Home Loan Prepayment Calculator is a simple yet powerful tool designed to help you understand how prepayments impact your loan. With just a few inputs, it gives you clear insights into interest savings and tenure reduction.
Here’s a step-by-step guide to use Credit Dharma’s PNB Home Loan Prepayment Calculator
- Enter Loan DetailsInput your loan amount, interest rate, and tenure.
- Add EMI DataSpecify the number of EMIs you’ve already paid.
- Input Prepayment AmountEnter the amount you’re planning to prepay.
- CalculateHit the button to see your results instantly.
Example Scenario:
- Loan Amount: ₹1 crore
- Interest Rate: 9% p.a.
- Tenure: 20 years
- EMIs Paid: 12
- Prepayment Amount: ₹2 lakh
Calculator Output:
- Total Interest Saved: ₹8,47,731
- Tenure Reduction: 12 months
This simple prepayment saves lakhs and shaves a year off the loan tenure!
Home Loan Foreclosure Charges by Top Banks
Not all lenders follow the same policy for foreclosure charges. Here’s a list of charges levied by some of the major financial institutions in India.
| Lender | Foreclosure Charges (Floating Loan) | Foreclosure Charges (Fixed Loan) |
|---|---|---|
| SBI | Nil | Nil |
| HDFC | Nil | Up to 2% of outstanding principal |
| ICICI Bank | Nil | 2% on principal (for non-individuals) |
| Kotak Mahindra Bank | Nil | Nil |
| LIC Housing Finance | Nil | Up to 2% of prepaid amount |
| Axis Bank | Nil | Nil |
| PNB Housing Finance | Nil (individuals) | 2% of prepaid amount (non-individuals) |
| Yes Bank | Nil (floating loans) | 4% of outstanding amount (fixed) |
| IDBI Bank | Nil | Nil |
| Bank of Baroda | Nil | Nil |
| TATA Capital | Nil (when paid with own funds) | 2% to 5% (when refinanced) |
| Sammaan Capital | Nil | Nil |
Conclusion
Prepaying home loans substantially reduces interest outgo over long tenures. PNB Bank offers a stellar prepayment calculator that borrowers can easily utilize to determine possible savings on their housing loans. After considering key aspects, homeowners can decide suitable prepayment amounts and strategy to optimize savings.
Use PNB’s prepayment calculator today to accelerate your journey to debt-freedom! Feel free to reach out to our team of experts for any queries.
Frequently Asked Questions
Prepayment charges are usually a percentage of the prepayment amount. These rates vary by lender and loan type, so check your loan agreement for specific details.
Monthly prepayment is calculated by adding an extra amount to your regular monthly installment, which is applied directly to reducing the principal balance of your loan.
PNB typically does not levy prepayment charges on floating rate home loans. For fixed rate loans, charges may apply as per the terms of the loan agreement.
Yes, prepayment reduces the principal amount, which in turn decreases the total interest payable over the life of the loan.
HDFC Home Loan
SBI Home Loan
