Loans
Refinancing
pronounced: [R-e-f-i-n-a-n-c-i-n-g]
Replacing an existing loan with a new one, typically to obtain a lower interest rate, change the loan tenure, or switch from a floating to a fixed rate.
Common for home loans and personal loans.
Example
A ₹50 lakh home loan at 8.5% p.a. for 20 years has an EMI of ₹38,601/month. Total interest paid = ₹42,64,240 — almost equal to the principal. Making part-prepayments from year 6 can reduce tenure by 4+ years.
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Last updated: 21 May 2026