Buying a home is a big step that frequently requires a home loan to fill the gap in finances. Knowing how much percentage of salary should be EMI to preserve financial stability is a crucial component of this commitment. It usually doesn’t exceeds 40% of your net income.
How much Percentage of Salary should be Home Loan EMI in India?
In India, it is generally recommended that home loan EMIs should not exceed 40% of your monthly salary. This is a widely accepted benchmark followed by both financial advisors and lending institutions.
The logic behind this limit is to ensure that borrowers have enough disposable income left to manage household expenses, investments, and other financial obligations without falling into a debt trap.
Lenders like banks and housing finance companies assess a borrower’s repayment capacity before sanctioning a loan.
One of the key factors in this assessment is the Fixed Obligations to Income Ratio (FOIR), which measures how much of your income goes towards fixed obligations like EMIs.
Ideally, your total EMIs including the one you're applying for should stay within 40% to 50% of your net monthly income.
If you have no other EMIs or financial liabilities, you may be able to afford a slightly higher EMI. I hope you found this information useful.
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How much Percentage of Salary should be Home Loan EMI?
amrit2
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2025-06-19T13:58:14+00:00 2025-07-02T17:59:33+00:00Comment
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