Pre-EMI is the interest you pay on the disbursed portion of a home loan before full disbursement (typically during construction). You only pay interest, not principal, so the loan balance doesn't reduce during this period.
Should I choose Pre-EMI or full EMI?
Full EMI is financially better — you start repaying principal immediately, reducing total interest. Pre-EMI suits those with tight cash flows during construction or who prefer to keep funds invested elsewhere for higher returns.
Can Pre-EMI interest be claimed as tax deduction?
Pre-EMI interest can be claimed in 5 equal installments starting from the year of possession under Section 24(b). The total deduction limit including regular EMI interest is ₹2 lakh per year for self-occupied property.
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