Is full EMI better than Pre EMI for NRI home loan?

Hi Anil,
I am planning to go for a Home loan with SBI but most people say full EMI is better than Pre Emi. What do you suggest. I am an NRI and the project is under construction. Could you share your email ID to share further details on the loan.


  1. In case of FULL EMI, the amount you would pay each month will be calculated on the basis of the total loan amount, while according to the pre-EMI, you would have to pay only the interest on the loan that will be disbursed at each stage of construction. The real EMI payment will start after you get possession of the house in case pf pre-EMI.

Each FULL EMI you pay contains a portion of Interest and principal. If you pay only pre-EMI, you are only paying interest and no principal.

I would strongly suggest to pay FULL EMI from the beginning. This is simply because the more you pay principal, the faster you will be able to pay off the loan. And in case of construction linked loan disbursement plan, the interest in only charged on the portion that has been disbursed till date. This gives you an opportunity to pay more principal in each EMI than you would have paid if full loan has been disbursed in one shot.

Makes sense?

  1. You can write your questions as an anonymous user here in comments and I will be able to help you. I don’t share email ID here.

Let me know if you need more information.