RBI Rate Cuts: How to Really Lower Your Home Loan Interest

• RBI has repeatedly cut the repo rate, leading to lower home loan interest rates.
• Despite rate cuts, home loan interest rates (7.9%-8.2%) often exceed returns from safe investments, creating negative arbitrage.
• Prepaying home loans is a sound financial strategy, offering guaranteed, tax-free returns by reducing future interest payments.
• The new income tax policy removes interest deductions for self-occupied home loans, making prepayment more beneficial.
• Early loan years involve higher interest payments; prepayment significantly reduces the loan's most expensive component and overall tenure.

Why It Matters: Prepaying home loans is key to saving money despite RBI rate cuts.