Confused by home loan jargon? Fixed vs floating, MCLR vs repo-linked, pre-EMI vs full EMI — we break it all down with real numbers.
Fixed vs Floating: Which Rate Should You Choose?
Fixed rates stay the same throughout the tenure — you pay ₹X every month, no surprises. Floating rates change with the market — they start lower but can increase. In India, most 'fixed' rates are actually fixed for 2–3 years, then convert to floating. True fixed-rate loans are rare and come with a 0.5–1% premium. Our recommendation: in a rising interest rate environment, lock in a fixed rate for the first 3–5 years. In a falling rate environment, go floating from day one. As of 2025, the RBI repo rate is relatively stable, making floating rates the more popular choice at 8.5–9% for salaried borrowers.
Understanding EMI: The Math That Matters
EMI (Equated Monthly Installment) is calculated using three variables: principal (loan amount), interest rate, and tenure (in months). For a ₹50 lakh loan at 8.75% for 20 years, your EMI would be approximately ₹44,200/month. Over 20 years, you'll repay ₹1.06 Cr — meaning you pay ₹56 lakh in interest alone. By increasing tenure to 25 years, EMI drops to ₹41,400 but total interest paid jumps to ₹74 lakh. The sweet spot for most borrowers is 15–20 years. Shorter tenures save lakhs in interest; longer tenures improve monthly cash flow.
Pre-EMI vs Full EMI for Under-Construction Properties
When you buy an under-construction property, the bank disburses the loan in stages linked to construction progress. During this phase, you can choose to pay either pre-EMI (interest-only payments on the disbursed amount) or full EMI (principal + interest from day one). Pre-EMI is lighter on your wallet during construction but doesn't reduce your principal — meaning you pay more interest over the loan's lifetime. Full EMI starts higher but begins chipping away at the principal immediately. If you can afford it, full EMI saves significant money long-term.
Documents You'll Need
For salaried individuals: identity proof (Aadhaar + PAN), address proof, last 6 months' salary slips, Form 16 / ITR for the last 2 years, last 6 months' bank statements showing salary credits, and property documents (agreement, allotment letter, builder NOC, approved plan). For self-employed individuals: the same identity/address proofs plus ITR for 3 years, audited financial statements, business proof (GST registration, partnership deed), and a CA certificate. Pro tip: get your documents in order before approaching the bank — it speeds up approval by 2–3 weeks.
How Kronus Helps With Home Loans
We've partnered with SBI, HDFC, ICICI, and Axis Bank to offer pre-approved loan facilities for all Kronus projects. Our customer relations team will help you compare offers, prepare documents, and liaise with the bank. Many of our buyers have gone from first enquiry to loan sanction in under 10 working days. We don't charge any brokerage or processing assistance fee — this is part of the Kronus buying experience.
Yuvraj Tomar
Customer Relations, Kronus Infratech
Building homes and communities in Sonipat since 2014. Got a question about this article? Reach out directly.