How Much Part Payment Should You Make On Your Personal Loan?

What is part payment in personal loan? Get the complete details on part payment of personal loans & the ways to calculate it. Visit to know!

15 Jul,2022 10:32 IST 313
How Much Part Payment Should You Make On Your Personal Loan?

Part payments can effectively reduce the outstanding personal loan amount and, ultimately, the total interest by shortening the loan tenure. You can calculate the part payment amount through a personal loan part payment calculator to budget your finances accordingly. It is important to note that if you make part payments, there is no change in the principal amount or interest rate charged on your personal loan by banks.

What Is Prepayment?

Prepayment means paying off a loan early. Depending on the terms of your loan, you can make the prepayment in whole or in part. With prepayment, you'll pay less interest in the long run because you've started to pay off your debt sooner.

Part payment is not a prepayment but a partial prepayment of a personal loan amount. In the case of a personal loan, you can make a part payment by paying only the interest amount for the month to reduce your monthly instalments, but it does not change your principal amount at all. You can use a loan calculator to decide your part payment amount depending on your remaining EMIs.

You can make partial prepayments during renewal periods (for example, every year) when you pay off a portion of your home loan and keep paying the remaining sum over the remaining tenure period.

When Should You Prepay Your Loan?

• A surplus in your budget permits you to repay your loan in part or whole without derailing other financial liabilities.
• Most financial institutions allow loan prepayments to occur one year after loan disbursal.
• You wish to reduce your principal amount and decrease the interest amount during your tenure.

Zaroorat aapki. Personal Loan Humara
Apply Now

Personal Loan Part Payment Calculator

When deciding the part payment amount, ensure that you are comfortable repaying the remaining monthly instalments even after making a part payment on your personal loan.

Additionally, it is important to assess whether you can invest in mutual funds via SIP, build an emergency fund, save for children's education etc., before deciding the amount to go towards your personal loan EMIs.

Apply For A Personal Loan With IIFL Finance

With IIFL Finance personal loan, be it for a vacation or higher education, or financial emergency, this is where we can help you out with a loan of up to Rs. 5 lakh processed over just minutes.

Learn more about personal loan options, calculate your personal loan EMI with a loan calculator and analyze various prepayment options for these personal loans by visiting the IIFL website. Getting a personal loan has never been this quick or easy. Reach out to us and fulfil all your personal financial needs.

FAQs

Q1. Is it good to pay a part-payment?
Ans. You can lower your tenure and EMI by making part payments and increasing your savings and emergency fund. Part payments are more efficient than regular monthly instalments if you pay off the loan in a short period.

Q2. Why should you repay personal loans early?

A personal loan is a debt that you should repay as soon as possible. It may be tempting to take the cash from the lender and spend it on something else, but it's better to repay your loan early. Here are some reasons why:
• You can save money by paying off your loan with savings or other funds instead of repaying it over an extended period.
• The less interest you pay on your debt, the more money you have left over at the end of each month for saving or paying off other debts (like credit cards).
• If you have several debts, such as student loans and credit card balances, then making extra payments will help you tackle them faster.

Zaroorat aapki. Personal Loan Humara
Apply Now

Disclaimer: The information contained in this post is for general information purposes only. IIFL Finance Limited (including its associates and affiliates) ("the Company") assumes no liability or responsibility for any errors or omissions in the contents of this post and under no circumstances shall the Company be liable for any damage, loss, injury or disappointment etc. suffered by any reader. All information in this post is provided "as is", with no guarantee of completeness, accuracy, timeliness or of the results etc. obtained from the use of this information, and without warranty of any kind, express or implied, including, but not limited to warranties of performance, merchantability and fitness for a particular purpose. Given the changing nature of laws, rules and regulations, there may be delays, omissions or inaccuracies in the information contained in this post. The information on this post is provided with the understanding that the Company is not herein engaged in rendering legal, accounting, tax, or other professional advice and services. As such, it should not be used as a substitute for consultation with professional accounting, tax, legal or other competent advisers. This post may contain views and opinions which are those of the authors and do not necessarily reflect the official policy or position of any other agency or organization. This post may also contain links to external websites that are not provided or maintained by or in any way affiliated with the Company and the Company does not guarantee the accuracy, relevance, timeliness, or completeness of any information on these external websites. Any/ all (Gold/ Personal/ Business) loan product specifications and information that maybe stated in this post are subject to change from time to time, readers are advised to reach out to the Company for current specifications of the said (Gold/ Personal/ Business) loan.

Most Read

Check the Difference Between 24k and 22k Gold
9 Jan,2024 09:26 IST
65064 Views
Like 8190 8190 Likes
Franking and Stamping: What’s the difference?
14 Aug,2017 03:45 IST
47610 Views
Like 9548 9548 Likes
Why Gold Is Cheaper In Kerala?
15 Feb,2024 09:35 IST
1859 Views
Like 6117 1802 Likes
Personal Loan With Low CIBIL Score
21 Jun,2022 09:38 IST
30821 Views
Like 8532 8532 Likes

Get in Touch

By clicking on Apply Now button on the page, you authorize IIFL & its representatives to inform you about various products, offers and services provided by IIFL through any mode including telephone calls, SMS, letters, whatsapp etc.You confirm that laws in relation to unsolicited communication referred in 'National Do Not Call Registry' as laid down by 'Telecom Regulatory Authority of India' will not be applicable for such information/communication.
I accept the Terms and Conditions