Final Up to date on Dec 20, 2024 by Ayushi Gangwar
Q: What’s the month-to-month instalment on a Rs.1 lakh mortgage towards mutual funds (LAMF)?
In LAMF, debtors pay solely the month-to-month curiosity on the mortgage quantity. For a Rs. 1 lakh mortgage, the annual rate of interest is 10.75%, which ends up in a month-to-month curiosity fee ofRs.896. That is decrease in comparison with conventional loans the place each curiosity and principal are paid month-to-month.
Month-to-month funds for various mortgage quantities
| Mortgage quantity | Rate of interest | Month-to-month installment |
| Rs.25,000 | 10.75% | Rs.224 |
| Rs.50,000 | 10.75% | Rs.448 |
| Rs.75,000 | 10.75% | Rs.672 |
| Rs.1,00,000 | 10.75% | Rs.896 |
Observe: For illustration functions solely. The borrower additionally has to repay the principal quantity throughout the 3 years which isn’t part of month-to-month funds.
Q: Does the month-to-month fee embrace the principal quantity?
No, the month-to-month funds cowl solely the curiosity. The principal compensation could be carried out at any time throughout the 3-year tenure.
Q: Can I make partial principal repayments?
Sure, you might have the pliability to make partial principal repayments in the course of the 3-year interval. Every principal compensation reduces the curiosity obligation. For instance, in case you have taken a mortgage towards mutual funds for Rs.1 lakh in January and also you repay Rs.50,000 in February, your excellent principal drops toRs.50,000, and from the following month onward, your month-to-month curiosity fee is halved to ~Rs. 448. You may persistently scale back the principal quantity at any level, thereby decreasing your month-to-month funds.
Q: Are there prepayment prices?
No, there aren’t any prepayment prices or foreclosures prices for early repayments of the principal quantity.
