We mentioned below are steps a home buyer can take, if his income sources have been impacted because of this crisis.
As we all know that the second wave of the Coronavirus pandemic assumes massive proportions. Those who are servicing long tenure loans like home loans have additional reasons to worry, apart from staying safe during this crisis. How would one pay the home loan EMIs, if they were losing their job? We are highlighting apt measures to opt, in case you lose your job to pay EMIs, considering reading until the end to know more.
7 Apt Measures to opt to pay EMIs if you Lose Your Job
1. Seek Benefit from Moratorium period/EMI Holiday
In the Year 2020, RBI showed an attempt of relief to EMIs payers amid the Novel COVID-19 Pandemic along with dropping the repo rate by 4%. People encountering struggle to pay their EMIs could postpone payment under Moratorium. You can look for the benefit as once you are able to pay the EMI with Interest and your credit history will be fine as well. In April 2021, RBI governor Shaktikanta Das said there was no need for a loan repayment moratorium ‘at present’, stating that businesses were better prepared to face the situation.
2. Use Provident Fund
Dearness allowance (DA) from the Provident Fund can turn out to be helpful in paying the cost of EMIs. In march 29, 2020 government permitted 60 million subscribers for the Employees’ Provident Fund Organization for withdrawing 75% from their savings.
Provident Fund would be sufficed for EMIs till you find your next job. Additionally, short term credit period makes the provident fund option, a righteous choice to go along with.
3. Pay from Severance Money
When the organization terminates any employee, the organization tends to offer money that is equal to salary for the tenure of the notice period. The amount you get paid as severance money can become a big relief in such a crisis where your credit history wouldn’t be ruined as a defaulter. If the money is paid handsomely, it will be enough to save one from the additional interest in case of missing an EMI.
4. Gain Benefit from Investments
Investments are meant to come in handy in such times so digging into your investments is an effective method to pay EMI. By breaking recurring deposits or fixed deposits. Borrowing money from lenders at reasonable interest is another optimal way to pay off your debt. Lending Money on Investments made is a preventive measure from paying hefty interest for defaulting home loan EMI.
5. Pick for Loan against Insurance Policy
Do you know life insurance cover is an aid that will be proven to be beneficial in such circumstances? In case you have left no option to pay EMI, choose to pick for loan against the insurance policy. Insurance Company will help to disburse your demand quickly as per details and debt amount would be something suitable & convenient for you to pay. In contrast to the personal loan, the interest rate on a loan against an insurance policy is much cheaper and borrower-friendly.
6. Asset Liquidity to Pay off Debt
Liquidate your assets at this juncture for paying off the debt of a Home loan. Selling gold or other jewelry can arrange adequate funds to meet your requirements. Gold prices are often at a high spike nowadays benefitting you to attain maximum from liquidating your assets. Selling off your personal assets such as electronics, automobiles, and others may allow you to arrange a handsome price in such need.
Financial institutions do offer loans against gold and the interest rate on gold loans is quite appealing starting from 7.25% to 18% P.A. Furthermore, Gold Loans are easily available if the asset is premium.
7. Assistance from Family & Friends
Taking support from family and friends who can afford to lend you money for time being Additionally, support from family & friends will provide you the advantage of not paying higher interest on the borrowed amount, along with if you are not able to payback on time you can ask to extend the tenure which wouldn’t be difficult.
Nevertheless, it is suggested to make the duly payment of the borrowed money as being a defaulter in such cases might distress your personal relationships.
In the end, there are considerable measures that can come in handy to help you amid the COVID-19 pandemic to pay your EMIs. Choose the most suitable option mentioned above to prevent from defaulting your home loan EMI and stay safe.
