What happens if I miss an EMI payment for my education loan on property?

Missing your Equated Monthly Instalment (EMI) for an education loan secured against property can lead to serious consequences. If the EMI is not paid on the due date, financial institutions usually offer a grace period. During this time, you will be contacted to pay the pending amount along with a late payment penalty, which could be a certain percentage of the overdue amount.

If the EMI remains unpaid even after the grace period, besides just a significant drop in your credit score, the account is also classified as a Non-Performing Asset (NPA). In this case, the financial institution will initiate loan recovery proceedings which can include repossession of the mortgaged property used as collateral, legal proceedings and auctioning of the property to recover the outstanding loan amount. You may use an online education loan EMI calculator for quick calculation and to know the interest payable and the EMI.