Loan Repayment Strategies
Master proven strategies to pay off loans faster and save interest
4 Effective Repayment Strategies
Avalanche Method
Pay minimum on all loans, extra towards highest interest rate loan first
Snowball Method
Pay minimum on all loans, extra towards smallest balance loan first
Bi-weekly Payments
Pay half EMI every 2 weeks instead of monthly full payment
Lump Sum Prepayment
Make one-time large payment when you have bonus or extra income
Strategy Comparison (₹10 Lakh Loan @ 10% p.a.)
| Strategy | Payoff Time | Total Payment | Interest Paid | Best For |
|---|---|---|---|---|
| Avalanche | 24 months | ₹10,20,000 | ₹20,000 | Multiple high-interest loans |
| Snowball | 26 months | ₹10,45,000 | ₹45,000 | Motivation & quick wins |
| Bi-weekly | 22 months | ₹10,05,000 | ₹5,000 | Regular income |
| Lump Sum | 18 months | ₹9,80,000 | Varies | One-time windfalls |
4-Step Repayment Plan
List All Loans
Write down all loans with balance, interest rate, and EMI
Choose Strategy
Select Avalanche (save interest) or Snowball (quick wins)
Set Target Date
Define when you want to be debt-free
Track Progress
Monitor monthly progress towards debt-freedom
Benefits of Strategic Repayment
Save Interest
By paying 1-2 years early
Improve Credit
As you pay down debt
Financial Freedom
Less debt burden
Better Loan Terms
For future borrowing
6 Repayment Tips
Automate payments
Set up auto-payment to ensure on-time payments
Round up payments
Pay ₹10,005 instead of ₹10,000 for faster payoff
Check for penalties
Verify prepayment terms before early repayment
Negotiate rates
After good payment history, ask for rate reduction
Use bonus income
Dedicate annual bonuses towards loan prepayment
Refinance if better
Refinance to lower rate if available and beneficial
Start Your Debt Payoff Journey
Use our EMI calculator to plan your repayment strategy