Track staged releases.
Master your pre-EMI.

When you buy an under-construction property or build a home on a plot, the lending institution does not disburse the full loan amount on day one. Instead, funds are released in stages (tranches) as construction milestones are verified. During this period, you pay Pre-EMI interest — simple interest charged strictly on the cumulative disbursed amount. No principal is repaid until full disbursement or possession.

Pre-EMI keeps your monthly outflow lower during construction, which helps if you are simultaneously paying house rent. However, none of your pre-EMI payments reduce the loan principal. Choosing Full EMI from day one means excess payments immediately reduce principal, saving substantial interest over the long run.

Indian retail banks (such as SBI, HDFC Bank, ICICI Bank, and Axis Bank) compute pre-EMI interest using the Actual / 365 daily product convention. For each day between disbursement dates, interest is accrued on the outstanding balance for that exact number of calendar days. At the end of each billing cycle, the accrued daily interest is billed as your monthly pre-EMI demand.

You are never charged interest on unreleased sanction tranches. If the final construction finishes below the sanctioned budget, or if you cancel the remaining tranche, the lender closes the loan based solely on the amount actually disbursed.