Out of a Job? Here’s How You Can Still Manage Your Home Loan EMIs

Losing a job can be stressful, especially when you have long-term financial commitments like a home loan. In such uncertain times, especially during health or economic crises, ensuring timely EMI payments becomes a major concern. Missing EMIs can not only lead to penalties but also affect your credit score. However, there are several ways to keep up with your home loan repayments even if your income stops.

Use the Moratorium Option.

In emergency situations like the COVID-19 pandemic, the Reserve Bank of India offered a moratorium on loan repayments. This allowed borrowers to delay their EMIs without it being marked as a default. Though the interest continues to accumulate, it gives temporary relief and helps avoid a hit to your credit history.

Rely on Your Severance Pay

If your company provides a severance package or salary for the notice period, that amount can be used to cover upcoming EMIs. This helps prevent penalties and gives you breathing space while you search for a new job. Using this money wisely can reduce the financial burden during the transition phase.

Withdraw From Provident Fund

The government has allowed partial withdrawals from the Provident Fund for those in financial need. You can withdraw up to 75% of your savings or three months’ basic salary and dearness allowance, whichever is lower. The best part is that the funds are usually credited within a few days, making it a quick support system during emergencies.

Seek Help From Family or Friends

Borrowing from close friends or family members is another practical option. These loans are often interest-free and come with flexible repayment terms. This method avoids formal borrowing and helps you stay afloat without adding more financial pressure.

Use Your Savings or Investments

If you have fixed deposits or recurring deposits, this is the time to use them. With interest rates on savings at a low, breaking a deposit might be better than missing an EMI. It ensures your dues are cleared and your loan status remains healthy.

Loan Against Insurance Policy

You can also consider taking a loan against your life insurance policy. These loans have lower interest rates than personal loans and are approved faster since the insurer already holds your details.

Liquidate Non-Essential Assets

If needed, you can also pledge gold or other investments to raise funds. Many banks offer quick gold loans that can help in paying EMIs without hassle. Selling or pledging assets can be a temporary solution until your income stabilizes.