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When you make a lump-sum prepayment, banks give you a choice. Mathematically, reducing your tenure saves you significantly more money in long-term interest. However, if you are currently facing cash flow issues, reducing the EMI provides immediate monthly relief.

If your target EMI is less than the new interest generated by the loan amount each month, your loan balance will actually increase every month instead of decreasing. You must increase your EMI to at least cover the monthly interest to ever pay off the loan.

Most Indian banks and HFCs (like SBI and HDFC) offer a maximum loan tenure of 30 years. However, this is capped by your retirement age. The loan must typically be fully repaid by the time you turn 60 or 65. If you are 40 years old, your maximum tenure will likely be restricted to 20 years.

No. According to RBI guidelines, banks cannot charge foreclosure or prepayment penalties on floating-rate home loans for individual borrowers. You are free to pay off your loan as quickly as you want. (Note: Fixed-rate loans or loans taken by companies may still attract penalties).

Technically, yes. Because you are paying less total interest over the life of the loan, you will have fewer years to claim the ₹2 Lakh deduction under Section 24(b). However, the massive amount of cash you save by not paying bank interest far outweighs the tax rebate you would have received.