Do This Right Away if Your Feel Repaying Your Personal Loan EMI is a Burden!

Personal loans can assist to fill the monetary gap in your budget with zero need to pledge your asset as collateral or security. Its unsecured nature helps process the loan proceed faster than other secured loans. In case of regular personal loan, the proceeds are processed within 2-7 days while instant personal loan due to its pre-approved nature processes the proceeds on the same day of the loan application. This feature of quick proceed disbursement immensely helps you in times of financial emergencies when the need for funds is immediate.

Despite such benefits, opting for bigger proceeds through personal loan usually consumes a considerable portion of your disposable income, often leaving you with little for your other crucial goals. In case of personal loan on floating interest rate, any upward movement of interest rate can further hamper your financial health.

Here are some tips that can lower your personal loan EMI burden:

  • For the existing personal loan borrowers


Opt for personal loan balance transfer option and ask for an extension in your loan tenure

Personal loan balance transfer is the process where you can transfer your overall outstanding personal loan to another lender. You should choose the personal loan balance transfer option at comparatively lower interest rate and longer repayment tenure.

For instance, suppose you availed a personal loan of Rs 20 lakh, 2 years back at 15% p.a. for 6 years with EMI of Rs 42,290. Currently, your outstanding personal loan amount is Rs 14.96 lakh with loan repayment tenure of 4 years left. Now, if you opt for the personal loan balance transfer option at 11% p.a. for the remaining repayment tenure of 4 years, the EMI would be down to Rs 38,665. If you want to further lower your personal loan EMI, you can increase your tenure to 6 years and the EMI will reduce to Rs 28,475. This calculation can be simply done by using an online personal loan EMI calculator. On inserting the details like personal loan amount, loan repayment tenure and interest rate on the personal loan calculator, you can simply get the results in the form of loan EMI, total interest payable and total payment (principal & interest).

As longer repayment tenure results in higher overall interest outgo, you must try and prepay your personal loan whenever you avail any surplus fund. Remember, as the personal loan balance transfer request is looked upon as a new personal loan application by the new lenders, they might charge processing fee, administrative charges etc., during the processing time. Hence, ensure to factor in all the associated costs before opting for the personal loan balance transfer option. Select this option only if your interest savings substantially outweighs your cost incurred on the balance transfer option.

  • For new applicants


Consider personal loan offers among various lenders

You must always make sure to check various personal loan offers based on the rate of interest, processing charges etc., before zeroing on any lender. Personal loan interest rate and numerous other linked charges differ across lenders based upon their credit risk evaluation. For instance, many lenders may provide you with lower personal interest rate and processing fees if you have a higher credit score of 750 and above. Also, many lenders may offer an interest rate based on your job or employer. Using online lending markets is one of the prudent modes of comparing the interest rates and other loan features. Such platforms facilitate personal loan comparisons based on your credit score, monthly income, job, and other eligibility criteria.


Select longer tenure

Selecting longer repayment tenure before clicking on the personal loan apply option will not just lower your EMI outgo but will result in an increase in your personal loan eligibility. However, as higher repayment tenure enhances your overall interest cost, you must consider choosing the prepayment option whenever you avail any surplus fund. Remember that for the floating rate credit options, RBI has disallowed lenders from charging prepayment charges while for fixed income rate loans they might charge prepayment fees. Make sure to use the online personal loan calculator to get an idea about your optimum repayment tenure depending upon your repayment capacity.


As personal loan is unsecured in nature, its interest rate is generally higher than secured loan options and hence the EMI of it may hamper your monthly budget. Moreover, if you fail to repay the EMI on time, your credit score may decrease. Thus, ensure to follow the above listed tips as it may help you repay your personal loan EMI without any stress or inconvenience.

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