What Is Home Loan Tenure? Complete Guide for Home Buyers

What Is Home Loan Tenure?

[{"selector":"#anim-bcb203fd-6c55-4bb8-8ac3-ecff7e0cf462 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(7.835937244150102%, 0, 0)","translate3d(0%, 0, 0)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] Home loan tenure is the total time period you get to repay your home loan through monthly EMIs. Home loan tenure is the total time period you get to repay your home loan through monthly EMIs.

Common Home Loan Tenure

[{"selector":"#anim-81d553ac-d7c8-44b5-a033-b9d33a441626 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(7.812499744007886%, 0, 0)","translate3d(0%, 0, 0)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] Most banks and financial institutions offer home loan tenures ranging from 5 years to 30 years, depending on eligibility and age. Most banks and financial institutions offer home loan tenures ranging from 5 years to 30 years, depending on eligibility and age.

Longer Tenure = Lower EMI

[{"selector":"#anim-8183c9a7-6b3b-4184-978a-d4b4f5ad568b [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(7.812499744007886%, 0, 0)","translate3d(0%, 0, 0)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] Choosing a longer loan tenure generally reduces your monthly EMI, making repayment easier on your monthly budget. Choosing a longer loan tenure generally reduces your monthly EMI, making repayment easier on your monthly budget.

But You May Pay More Interest

[{"selector":"#anim-2474ecfc-ffaa-447b-8485-3ce5898d0fb6 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(7.793367090830568%, 0, 0)","translate3d(0%, 0, 0)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] A longer tenure may lower your EMI, but the total interest paid over the entire loan period can be higher. A longer tenure may lower your EMI, but the total interest paid over the entire loan period can be higher.

Shorter Tenure = Higher EMI

[{"selector":"#anim-c5e8c902-70a6-4f80-b9d0-e2281221cde3 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(7.812499744007886%, 0, 0)","translate3d(0%, 0, 0)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] A shorter tenure usually means a higher monthly EMI, but you may save significantly on total interest. A shorter tenure usually means a higher monthly EMI, but you may save significantly on total interest.

Example

[{"selector":"#anim-fb4ad978-87cf-4cb4-b857-75f5dea66323 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(7.812499744007886%, 0, 0)","translate3d(0%, 0, 0)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] If you take a home loan for 20 years instead of 10 years, your EMI may be lower, but you will continue paying interest for a longer period. If you take a home loan for 20 years instead of 10 years, your EMI may be lower, but you will continue paying interest for a longer period.

How to Choose the Right Tenure?

[{"selector":"#anim-782b6c85-6dae-41df-a3ba-00c4bb22c10c [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(7.812499744007886%, 0, 0)","translate3d(0%, 0, 0)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] Choose a tenure based on your monthly income, existing expenses, financial goals, age, and repayment capacity. Choose a tenure based on your monthly income, existing expenses, financial goals, age, and repayment capacity.

Smart Home Buyer Tip

[{"selector":"#anim-27b04f3c-160f-4fb9-b17d-eacaeffcca38 [data-leaf-element=\"true\"]","keyframes":{"transform":["translate(0%, 0%) scale(1.5)","translate(0%, 0%) scale(1)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"forwards"}] Do not choose a loan tenure only because the EMI looks affordable. Always compare the total interest payable before making a decision. Do not choose a loan tenure only because the EMI looks affordable. Always compare the total interest payable before making a decision.

[{"selector":"#anim-6ad128ee-3727-40a6-b680-e4bbda178d8d [data-leaf-element=\"true\"]","keyframes":{"transform":["translate3d(15.149456396767558%, 0, 0)","translate3d(0%, 0, 0)"]},"delay":0,"duration":2000,"easing":"cubic-bezier(.3,0,.55,1)","fill":"both"}] The right home loan tenure should balance an affordable EMI with lower overall interest and comfortable repayment. The right home loan tenure should balance an affordable EMI with lower overall interest and comfortable repayment.