Taking a ₹1 crore home loan? You could pay another ₹1 crore in interest: Here's how to cut your interest burden

A ₹ 1 crore home loan can look manageable when viewed through the lens of an ₹ 83,600 monthly EMI. But the real cost is far bigger. “The number that matters most isn’t the principal but what you end up repaying,” says Arijit Sen, SEBI Registered Investment Adviser, Co-Founder, Merry Mind.

For example, at roughly 8% p.a. over 20 years, the EMI is about ₹ 83,600, and total repayment comes to roughly ₹ 2.01 crore — so you pay about ₹ 1.01 crore in interest.

So, answering what the best way to bring down this interest burden without putting too much pressure on your monthly budget is, Sen says, “Every rupee you prepay is a guaranteed, risk‑free return equal to your loan rate. That makes early principal reduction one of the highest‑return, lowest‑risk investments you can make if your alternative is low‑yield bank deposits.”

“Also, tenure is the silent multiplier: stretching the loan to lower EMIs can double the interest you pay over time, while shortening tenure slashes interest even if EMIs rise a bit.”

If you’d like a practical approach, you may try these small, habit‑friendly moves:

“These are practical, low‑drama changes that compound into big savings,” Sen notes

The key takeaway is simple: don't judge a home loan only by its EMI. The tenure, total repayment and interest outgo can matter far more. A ₹ 1 crore loan may look like a ₹ 83,600-a-month commitment, but over 20 years, it can amount to roughly ₹ 2 crore in repayments.

For borrowers, the goal should be to strike the right balance between maintaining liquidity and reducing expensive debt — because the earlier the principal comes down, the less interest has time to accumulate.

Sanchari Ghosh is an Assistant Editor at Mint with over 12 years of experience in journalism, specialising in personal finance, DLT & DeFi, geopolitics and foreign policy, with a particular emphasis on how these areas intersect. <br> She writes extensively about how money works in everyday life—helping readers navigate personal finance decisions. <br> As AI reshapes investing behaviour, capital is increasingly flowing into decentralized ecosystems, redefining how assets are managed, traded, and valued. She focuses on explaining how money flows within frameworks like Distributed Ledger Technology (DLT), DeFi protocols, and crypto markets—while also exploring what the future of money could look like in a trustless, programmable financial world. <br> She also focuses on immigration-related issues, simplifying complex topics around visas, passports, overseas financial planning, and the many practical challenges Indians face while moving or living abroad. <br> Alongside personal finance, Sanchari has a strong understanding of international politics, contemporary and historical conflicts, and global state decisions. She closely tracks how geopolitical developments influence economies, markets, and individual financial choices, bringing together finance and global affairs in her reporting. <br> She began her career as a desk editor, which gave her a strong foundation in news writing. Over time, her interest naturally shifted toward personal finance.