Dear Manish,
I have a case study on which I need your inputs.
I took a car loan from SBI for 4L and tenure is 7 yrs. Monthly EMI comes out to be Rs.6955 and Ive completed 2 yrs in May,13. I am 29 and my monthly income at the time of starting the loan was 45K.
After 2 yrs i feel these 7 yrs will take too long to complete and doubting myself if I should have taken a tenure of 3 or 5 yrs. Though, i have a prepayment facility but i want to understand what is better,
1. Paying 6955 x 84 months = apprx 6L, i.e. paying 50% extra on a loan on 4L.
2. Or taking a short tenure loan and save on the interest part.
How do we decide?
Also, what should be my current plan?
Regards,
Anurag.