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Bonus money and asset liquidation


Are you due to receive a bonus from work shortly? You could plan to use your bonus to fund your home loan prepayment benefits.


Some of your investments not earning high enough returns? Consider liquidating these funds and divert them towards prepaying your Home Loan.


Additional Reading: Dos & Don’ts of Home Loan Prepayment Benefits


It helps to prepay a Home Loan

Interest reduces: As the principal amount due on your Home Loan shrinks, so does the interest component charged on your loan. Due to the effect of compounding, in the first few years of a Home Loan, you will be paying off the interest. Prepayment in the early years significantly helps reduce the interest outflow.Income Tax savings: You can claim tax benefits under Section 80C of the Income Tax Al]