A home loan can feel like a financial ball and chain, a two or three-decade commitment that dictates many of your life choices. But what if it didn’t have to be that way?
In 2020, I took on a 20-year home loan. Less than three years later, I made my final payment.
This isn’t a story about getting lucky with a secret stock tip. It’s a story about strategy, timing, and a healthy dose of fear when interest rates started climbing. Here’s exactly how I did it.

The Starting Line: A Calculated Bet in an Uncertain World

Back in 2020, my life was in a good place financially. I had just started making enough money where, after all my spending, there was a decent chunk left over. Crucially, I was living with my parents while figuring out which city I wanted to settle in, which massively cut down my expenses.

My monthly income was around ₹1,56,000, and my expenses were barely ₹30,000. The biggest hurdle for most homebuyers—the down payment—was something I managed through a bit of luck and foresight, by selling some Bitcoin I had held.

With the down payment sorted, I didn’t just buy any property. I chose a premium apartment in a great location. My thinking was simple, especially as the COVID-19 pandemic was creating so much economic uncertainty:

• People who can afford to rent premium places are more likely to be financially stable and not default on rent, even in a recession.
• They tend to keep the property in good condition, saving me from future maintenance headaches.

As a bonus, the property is in the middle of a city that’s now a major hub, and a metro station is being built within walking distance. It was a calculated bet on quality. My EMI (Equated Monthly Instalment) was about ₹57,000 for a 20-year loan.

The “Aha!” Moment: When the Math Turned Scary

I always knew that I wanted to obliterate my loan as soon as humanly possible. After around eight months, I couldn’t hold back any longer—I started overpaying on top of my EMI, driven by an undeniable urge to break free.

But then, the real fire ignited when interest rates began to surge. I had confidently locked my loan at a cozy 6.5%, but as the market shifted, it skyrocketed past a staggering 8.5%.

And here’s the unsettling truth that the banks conveniently keep under wraps: my EMI didn’t increase! Instead, they stealthily extended my tenure. That 20-year loan I once felt okay with suddenly loomed over me like a terrifying specter, growing longer and longer. The thought of a longer commitment, beyond those already daunting 20 years, sent chills down my spine.

At that moment, the stakes were too high. I had funds invested in mutual funds, but the idea of having my loan stretched out longer than necessary was unbearable. I decided to take action—better to forgo potential market gains than be shackled to a bank with rapidly ballooning interest for years to come. I ensured I still had my safety net intact—about a year’s worth of expenses lingering in my investments—and made the bold choice to pay off the rest.

My Repayment Playbook: Flexibility, Spreadsheets, and a Bit of Luck

I didn’t follow a rigid repayment plan. My method was simple: at the end of each month, whatever money was left after my EMI (Equated Monthly Installment) and other necessary expenses, I transferred directly to my loan account. This approach, while not conventional, provided me the flexibility I needed to manage my finances without feeling overwhelmed.

A crucial factor here was my choice of bank. My loan was with the State Bank of India (SBI), which allows penalty-free overpayments that are instantly deducted from the principal amount. This is a game-changer for borrowers like me. Many other banks adjust overpayments on a quarterly basis, meaning your principal stays artificially high and you end up paying more interest over time. By opting for SBI, I was able to maximize the impact of each extra payment I made, significantly reducing the time it would take to pay off my loan.

I’ll be honest, the lockdown helped my financial situation more than I could have anticipated. With limited avenues to spend on entertainment and travel, my only major outgoings were food and essential bills. This unexpected benefit meant I could direct more of my disposable income towards my loan without having to make any drastic lifestyle sacrifices. For the first time, I had the opportunity to accelerate my debt repayment plan without feeling the pinch financially.

But what truly kept me going during this journey was my “extravagant spreadsheet.” I took a keen interest in tracking my repayments meticulously and created charts and trend lines to visualize every extra payment made. Watching the principal amount steadily decrease week by week was incredibly satisfying. Logging the details each month and seeing that graph dip was not just motivating—it felt like I was in control of my financial destiny. It transformed what could otherwise have been a long, hard slog into a game I was winning. The more I logged, the more I wanted to pay off; it became a challenge I was eager to embrace. I often found myself thinking about creative ways to cut back on non-essential expenses just to see my spreadsheet flourish further. In a way, the process itself taught me valuable financial discipline that I will carry with me long after my loan is paid off.

The Final Push: A Tax-Savvy Finish

The final payoff occurred strategically in three substantial chunks over two months: ₹10 lakh, ₹8 lakh, and another ₹8 lakh. I executed this plan with precision, ensuring tax efficiency by spreading my mutual fund withdrawals across the end of one financial year (March) and the beginning of the next (April). This savvy approach allowed me to capitalize on the ₹1 lakh tax-free Long Term Capital Gains (LTCG) limit for two consecutive years, resulting in significant tax savings. My meticulous planning not only highlighted my understanding of financial regulations but also underscored my unwavering commitment to achieving a debt-free life while maintaining optimal financial health.

When my loan account finally hit zero, my initial reaction was one of calm assurance. After two months of preparation, I was mentally ready for the final payoff; thus, the moment felt less climactic than anticipated. The true sense of relief and joy, however, arrived with my subsequent paycheck. When the full amount deposited in my bank account without a ₹57,000 EMI deduction, the sensation of freedom was palpable and exhilarating. Living independently, managing rent and other expenses, having that entire sum at my disposal represented a monumental psychological victory. It was as if I had liberated myself from the chains of debt, empowering me to envision a future brimming with possibilities.

Achieving debt-free status instilled in me the confidence to make bold career choices, knowing I was no longer anchored to a job solely to cover my EMI. I began pursuing opportunities that thrilled me, applying for positions aligned with my passions rather than simply what would meet my financial needs. In a volatile job market, that assurance was invaluable. The ability to select my career path without the constant burden of financial constraints allowed me to embrace new challenges and pursue growth opportunities that I would have previously overlooked. This was a transformative journey, shifting my mindset from survival mode to one of abundance and potential. I felt truly liberated, ready to invest in my future and explore avenues that resonated deeply with my aspirations.

My Single Best Piece of Advice

If I could drop just one bombshell of advice for anyone diving into their home loan journey, it would be this:
Start overpaying early, even if it’s just a drop in the ocean.

Listen up! When you throw in an extra payment, it slashes right into that principal amount. A smaller principal means you’re dodging piles of interest over the life of the loan. Seriously, even an extra ₹20,000 a month can turn the tables, saving you a fortune and cutting years off your repayment slog. Don’t sit around waiting to stack up a hefty sum; be bold, start small, and start NOW!