If interest rate towards loans goes up, lenders let the borrowers to carry on to pay current EMI right until he’s 65 in order to 70 yrs . old. It is about a lifestyle financial obligation trap; instead knowing the consequences
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Scores of mortgage borrowers, who’re maintenance its financing, still found characters telling them of an increase in attention price from their loan providers day to day in the past 3 years. Interest rates, that have been on the range of six.5% in order to eight% 2-3 years back, slowly been scaling up and achieved 9 in order to nine.5% from the .
The lenders already been extending the fresh payment name making it possible for the individuals in order to still pay the existing EMIs, till he or she is 65 to help you 70 years of age. Its practically a lifetime obligations trap; instead knowing the effects, lakhs off mortgage borrowers have already dropped on financial obligation pitfall.
Until interest levels have been increased of the 1.5%, the lenders continued to boost brand new repayment identity, nevertheless when the attention pricing increased past step 1.5%, loan providers had to help the EMIs together with, as established EMIs weren’t actually sufficient to safeguards the latest appropriate appeal payable thereon on established EMIs.