I am planning to buy a house in Bhandup. I will be taking a loan of 30 lac for the same. Now my plan is to either take a prepayment of 10 lac in year or take this 10 lac and make it an FD and use the interest from it to pay the regular home loan emi. Which of these plans is better?
Answered on November 08, 2017
Interest on Housing loan will always be higher than what you earn on Fixed Deposit. Further interest earned on fixed deposit is subjected to income tax. By paying off the loan you will be saved on interest expense. So it is advisable to repay the loan (if the rate of interest is high on the loan in comparison to FD)
