Burdened By EMIs

Are young Kashmiri government employees falling into debt trap, in pursuit of what they believe to be a wise, early investment into buying a house for themselves? A report in this newspaper cites examples of the young employees locked into decades-long housing loans.

- Amaar Mir

At first glance, housing loans seem like a win-win: Tax exemptions, bank incentives, and the cultural prestige of homeownership combine to create a powerful lure. Initially, it appears like you have to pay a modest EMI for a lifetime asset, but beneath this optimism lies a more sobering reality. For example, a housing loan of Rs 40-50 lakhs translates into EMIs of Rs 35,000-40,000 per month. This is nearly half the take-home pay of a mid-level government employee. And during the first several years, those payments go mostly toward interest, not the principal. As time passes, and the interest accumulates, the EMI keep nibbling aw