The creation of a disbursement cheque is the point of time when home loan EMI starts. Banks and non-banking financial companies such as the Bajaj Finserv use home loan EMI calculator to calculate home loan interest rate from the day the borrower picked their first disbursement cheque even before it was sanctioned.
If the borrower chooses to pay their home loan interest rate on their home loan on the 5th of every month, and their disbursement cheque was delivered to them on the 25th of the month, the lender would charge them interest from the 25th of the month to the 5th of the next month. The next home loan EMI interest would be calculated as per their EMI schedule.
Further, they can opt for either pre-EMI or full. The preference will be to pay full-home loan EMI if the borrower is capable of doing so. In most cases, lenders will push them towards paying a full home loan EMI for properties that are still being constructed. This will increase the loan tenor. If the borrower already has other loans then it would be wise to plan to close the home loan EMI faster.Also Read: How to Calculate Home Loan EMI?