Reduce financial burden with longer tenure Personal Loans

3 MinsJune 13, 2023

When you decide to borrow a personal loan, first check your eligibility for Personal Loan, compare interest rate on Personal Loan, check if the application process is easy and how fast the loan can be disbursed. But how much thought do you put into the loan repayment tenure? 

Reduce Financial Burden with Longer-Term Personal Loans

Most lenders offer personal loans for tenures ranging from one to seven years. Most borrowers accept whatever tenure the lender offers, or at the most whatever tenure matches the EMI they can afford to pay. But there are some advantages of opting for a longer tenure repayment period on your personal loan. Let’s see what they are: 

What is loan repayment tenure? 


The loan or repayment tenure is the duration between the disbursal of the loan and the date of the last EMI. You can select a tenure within this range as per your repayment capability.

You could consider increasing your personal loan tenure in the following situations – 

1. When you are just starting your career
If you have just started earning, your income may not be high, but you may have expenses to meet. There could be occasions when you may need to borrow a personal loan, say for a holiday or for buying a gadget. In such a case, you can increase your personal loan tenure to pay a lesser EMI. This will help you manage your monthly expenses comfortably and reduce your financial burden.

2. When your expenses are rising
When you have rising expenses and it becomes difficult to accommodate your loan EMIs, it is best to increase your loan tenure. Increasing the tenure by just one year can reduce your loan EMI. Use Axis Bank's personal loan EMI calculator to find the EMI amount for a particular tenure.

3. When you have an existing loan
Most lenders prefer borrowers who keep their debt-to-income ratio within control, typically between 30% and 40%. This means your monthly debt or EMIs on all your loans together should not be more be less than 30-40% of your monthly take-home pay. So, if you have existing loans, your lender may automatically increase your loan tenure increased automatically.

It is better to opt for loan tenure to bring your EMIs within your affordable range, rather than be faced with a situation where you are unable to pay your EMIs, to avoid a negative impact on your credit score.

Also Read: [Is it possible to get a second Personal Loan?]

4. When you want to opt for a higher loan amount
You can easily qualify for a higher personal loan amount if you choose a longer loan tenure. A longer tenure allows you to repay a high personal loan amount comfortably without feeling a financial pinch.

Axis Bank offers a personal loan tenure of 12 to 60 months. You can avail of a personal loan of up to ₹40 lakhs at the best interest rates for personal loans. You can even transfer your existing high-interest personal loan from a different lender to Axis Bank.

Summing Up 

Increasing your loan tenure reduces your financial burden and helps you maintain a good credit score. However, do note that your total interest outgo during the entire loan tenure may be higher, than if you opt for a shorter tenure loan. Hence, assess your needs carefully and consider all the influencing factors before deciding on your personal loan tenure.

Consider opting for Axis Bank personal loans to enjoy attractive interest rates for tenures of up to 5 years. Use the Axis Bank personal loan EMI calculator to evaluate the monthly EMI you will be able to pay comfortably. 

Disclaimer: This article is for information purpose only. The views expressed in this article are personal and do not necessarily constitute the views of Axis Bank Ltd. and its employees. Axis Bank Ltd. and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision.