Pay Zero Interest On Home Loan, Use This Simple ₹1700 SIP Strategy; Details Inside

Mumbai: For most people, a home loan is the biggest loan of their life. While buying a home is a dream, the long-term interest on the loan often turns it into a financial burden. In many cases, the interest paid becomes even more than the loan amount itself.

But here’s the good news — you can actually recover that interest, or even more, with a simple and smart investment.

A Smart Strategy: SIP Along With Your Loan

When you take a home loan, also start a small SIP (Systematic Investment Plan) in a mutual fund. Even a SIP of Rs 1,500–Rs 2,000 per month can work wonders over a long period like 30 years.

Let’s understand this with an example.

Loan Example: Rs 30 Lakh from SBI

Suppose you take a Rs 30 lakh home loan from SBI at 7.5 percent interest for 30 years. Your monthly EMI would be around Rs 20,976. Over 30 years, you’ll pay a total of Rs 45,51,517 as interest — a huge amount!

Loan Summary:

Loan Amount: Rs 30,00,000

Interest Rate: 7.5 percent

Loan Tenure: 30 years

Monthly EMI: Rs 20,976

Total Interest Payable: Rs 45,51,517

Start Rs 1,700 SIP & Earn More Than Interest

Now, if you invest just Rs 1,700/month in a mutual fund SIP for 30 years with an average return of 12 percent per year, you will build a fund of around Rs 52,37,654. Out of this, only Rs 6.12 lakh is your investment — the rest Rs 46.25 lakh is profit.

SIP Summary:

Monthly SIP: Rs 1,700

Tenure: 30 years

Total Invested: Rs 6,12,000

Maturity Amount: Rs 52,37,654

Total Returns: Rs 46,25,654

Final Result: Home Loan is Interest-Free

With this smart move, your SIP returns (Rs 46.25 lakh) will be more than your loan interest paid (Rs 45.51 lakh). So in the end, your home loan becomes almost interest-free, at least financially!