We discuss how to choose the best home loan term and the best home loan tenure. FundooMoney Website: www.fundoomoney.com Subscribe: https://www.youtube.com/channel/UCQTqvgT_qzPZn1D1bHsxtKw?sub_confirmation=1 Visit YouTube channel: https://www.youtube.com/c/FundooMoney Share Video: https://youtu.be/uo2yHBuDcfU Watch video “How to Choose The Right Home Loan Tenure” https://youtu.be/YqOTNEK51_Y Watch video “How To Invest For Home Down Payment l Save For Home Down Payment” https://youtu.be/3CJEAmQBDzo Watch video “How To Use Investments For Home Down Payment l Raising Down Payment” https://youtu.be/PXkgdwNJtyg Watch video “How Home Loan Pre-Approval Helps l Pre-Approved Home Loan Advantages” https://youtu.be/Bn_M80K2m9g Watch videos in our playlist on “Home Loan Basics” https://www.youtube.com/playlist?list=PLfnE1LvH_GLGaOXURxG0LAM7jzwKuWvRB Watch videos in our playlist "Managing A Home Loan" https://www.youtube.com/playlist?list=PLfnE1LvH_GLE14Z5lF-MXVPKsy5RntQ_s Watch videos in our playlist "Home Loan Prepayment" https://www.youtube.com/playlist?list=PLfnE1LvH_GLHL75qtf7gj3tj2DwLZ7Iw- Edited Highlights 00:00 Chapter 1 Introduction 00:06 We discuss how to choose the right home loan term or the right home loan tenure 00:12 Also, why home loan term is almost as important as home loan interest rate 00:30 You need give home loan term equal importance when you are about to take a home loan 1:03 Longer the home loan tenure, lower the home loan EMI 1:12 Or, shorter home loan term will mean a larger home loan EMI 1:30 Longer home loan term means lower EMI but larger overall interest payout during the term 1:44 Basically, it is a trade-off between EMI affordability and the overall interest you pay during the loan term 1:57 Larger interest payment due to longer loan periods means less investments for future needs 2:52 Why people don't sense the pain of a longer home loan tenure is it doesn't squeeze the home budget 3:22 There is no ideal home loan tenure 3:27 Each person's needs and financial realities should determine the best home loan term 3:59 Chapter 2 How To Choose The Best Home Loan Term 4:24 Home loan with terms of more than 5 years are termed as long term home loans 4:30 Home loans with terms of less than 5 years are termed as short term home loans 5:04 Let's take a Rs 35 lakh home loan at 7.55% p.a interest 5:27 When you move from a 15 year loan to a 20 year loan, you save Rs 4,242 in EMIs 5:41 But you pay additional Rs 9 lakh as interest 5:58 If the home loan term increases from 20 to 25 years 6:02 You only save Rs 2,274 in EMI but pay Rs 10 lakh extra 6:13 So, a jump from 15 year to 25 year loan, you are paying more than Rs 19 lakh extra 6:23 For higher interest rate, the effect will be even more 6:35 For larger home loans, the impact will be even more 6:45 You need to pay far more attention to home loan term than people do 6:50 Lowest home interest rate is the only important thing to watch out for when taking a home loan 7:09 Chapter 3 Factors Determining Your Home Loan Term 7:10 There are factors related to your realities that should determine your home loan term 7:23 Longer remaining work life allows you to opt for longer home loan term 7:37 With subsequent increases in income, you can keep servicing the home loan EMIs and then partly or full prepay the loan 7:52 The income level, the loan and EMI are other interrelated factors 8:09 Larger the income, larger the home loan you can take and larger the EMI you can pay 8:30 When home loan EMIs are a larger part of your take home pay, you need a longer home loan term 8:43 When you try to make your EMI affordable by opting for a longer home loan term, you are adding to your interest burden 9:05 Home loan interest rate determines your EMI and decision of your home loan tenure 9:18 With a hike in interest rates, you might choose to extend the home loan term 9:31 If income is high and interest rate is low, EMI will be a small part of the take home pay 9:37 In such a case, you will not mind a shorter home loan term 9:59 When EMI takes up a large portion of take home pay, a longer loan term is the only option 10:13 More the outstanding loans, more inevitable is a longer home loan term 11:00 If you are young, you can go for a longer home loan term 11:17 Eventually, you could partly or fully prepay the loan and retire it 11:43 Keep a little headroom for future home loan rate hikes 11:56 In case of home loan rate hikes, you should have the headroom to extend the loan term 12:19 If you are older, with less work life left, the loan provider may not offer a long home loan term 12:41 They will offer a home loan term that ensures that you fully repay the loan before your retirement 12:48 By yourself, you can opt for a shorter home loan term than offered 13:06 The young also benefit from the home loan tax benefits that ease the pressure on the budget