What happens to your loan tenure if there is a rate hike?


The answer will surprise us. Any guesses what happens to our loan tenure when rates rise from 6.5% to 9.5%

If this is the case for indian home loan buyers, wonder what the situation must be US floating rate interest home loan buyers

You can’t keep the EMI at the same value. If you do, it won’t even cover the interest. And if there is no principal repayment then loan will never be repaid.

Even if interest is changed to 8.5 percent then 35 years would be required. :sob::sob::sob:

1 Like

Compounding works both ways :smiley:

I dont have one but most Long term loans are usually Floating rate.
its very difficult to fix a rate on 20yr, usually it will be under 7-10yrs.