Of late, there has been a significant 1-2% interest rate diff between private bank home loans and PSU bank home loans. So one way to reduce ur EMI(if you are a private bank customer) is to shift your home loan from private to PSU banks.
Home Loan Amount : 20 lacs
Home loan Rate : 12%
Tenure : 20 years
EMI : 22000
Interest Rate : 10.5%
EMI : 19970
Savings in EMI : 2000
Savings in Total Interest paid for the loan : 4,80,000
Penalty(usually 2% of outstanding loan amount) : 40,000
Processing charge of new home loan (0.5% of loan amount) : 10,000
So Total Savings = 4,80,000 - (50,000) = 4,30,000
The saving of 2000 in EMI can be used for good investment purpose.
So analyze the current rates in the PSU and try to shift your home loan.
As per latest fact,PSUs offer floating home loan rate at 11% while private banks offer at 13%.So you ca then save your money if you act aptly.