My husband wanted to avail a home loan and buy a 2 BHK house for ourselves. He visited the bank to discuss the same but when asked if he wanted
home loan 30 years or 20 years, he got confused. I too had no idea which would be better so we both started discussing it with our close ones. There are certain facts I got to know which I shall mention here to help you all as well.
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Which home loan better 20 years or 30 years?
Choosing which home loan will be better depends on the lender. Availing a 30 years home loan means low monthly repayments but in that case the interest rate will be high. On the other hand, 20-year home loan terms mean high monthly repayments but with low-interest rates. So let me cite the positive and negative aspects of both, in short, to help you understand this better.
The 30-year home loan’s pros and cons
ProsLow monthly repayments mean you will get time to save money and repay the loan for 30 years. Giving a small amount from savings seems like a good option. You can relax and not need tension much about it every month.
ConsPeople ignore the fact that the 30-year loan term means you will end up paying more at the end since the interest rate is high. On that 30 years is a long time. Suppose you have availed it at the age of 40 years, the time when you will end up paying this amount, you will be 70 years old. This can become hectic as you will already be retired then.
The 20-year home loan’s pros and cons
ProsYou can pay off the loan amount faster and get the burden down easily. You can also build equity faster by availing the 20 years loan.
ConsHigh monthly repayments mean you have to pay a good sum of money on a monthly basis which can affect your savings and expenditure hugely.
I personally think the 20-year home loan will be better and we have applied for it. At least we will get rid of this burden soon. But if you are on a tight budget, you can avail the 30-year home loan and pay the debt slowly.
I hope this will help you to understand which is a better
home loan 30 years or 20 years.
Read More:How much GST on home loan is applicable?
What are the best home loan options available in India currently?
What are the biggest myths about home loans?
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Which Home Loan Better 20 Years or 30 Years?
Jignesh
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3 Year
2022-12-29T22:02:45+00:00 2023-09-21T15:34:32+00:00Comment
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