Home Loan prepayment

POSTED BY Aditya P ON May 23, 2013 2:46 pm COMMENTS (2)

2 replies on this article “Home Loan prepayment”

  1. Dear Aditya, please invest your money in MFs. there is positive compouding for investment of your money where as negative compounding is there for your homa loan. so investing your money is beneficial to you.



  2. Aditya P says:

    Am a 28 year old working professional. I fall in the 30% tax bracket. I have home loan outstanding for Rs.4lacs.Cuurent ROI is 10.75%. I had a windfall gain of a similar amount. Now am confused what to do with that money. Should I invest on MFs/FDs earning about 8-8.5% or should I prepay the loan amount?
    My concern is that by prepaying I may loose on the tax benefits and my net outflow is only 2.25% if the amount is invested in MFs/FDs. I have no other liabilty other than the home loan. Pls help me with the solution.

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