Q. Hi! I work with a private company which credits the salary on the 15th of every month. I have taken a personal loan last month for which the equated monthly instalment (EMI) date has been set as the 7th of every month. I forgot to check the EMI date while taking the loan. Paying EMIs on 7th may get financially taxing for me going forward. Is it possible to get the EMI date changed? Please help. Gurpreet Singh
A. Hi Gurpreet! Your concern about the EMI date is valid. It gets tough for a salaried individual to arrange for funds late in the salary cycle. EMIs are a mode through which funds are automatically debited from your account to your loan account on a date agreed upon with your lender every month.
Changing the EMI date is possible but hinges on your lender’s policies and your loan’s terms and conditions. The EMI changing policy varies from lender to lender. While some lenders allow changing the EMI date, many don’t. You should also be well aware that changing the EMI date will involve completing the related processes such as initiating a fresh payment mandate with your bank.
Your request to change the EMI date will also depend on your relationship with the lender. Some banks may also levy ‘Gap’ charges associated with changing the dates of the EMI. This will be calculated as per the date changing policies of a particular lender. Some lenders may ask you to pay interest for the period for which EMI due date is shifted. The lender will share the interest calculation for the period with you before the new date comes into force.
To get the date changed, you need to approach your lender and submit an application with instructions about the new date. This process differs from bank to bank. You may also need to resubmit revised post-dated cheques as per your applicable mode of payment. You will also have to provide a cheque/demand draft/banker’s cheque for the payment of interest to keep the EMI payment amount same after the date change is processed.
With your application, you must ensure that there will be sufficient funds available in your account for the EMIs and there will be no default. One way you may like to explore to change the date is by offering to increase the EMI amount from a new date. You can approach the lender’s grievance department if it refuses to entertain your application with a valid reason for the EMI date change.
Have a question on personal finance? Ping me on Twitter at @adhilshetty with the hashtag #AskAdhil. The writer is CEO, BankBazaar.com, an online marketplace for loans and credit cards. Need help in calculating your EMI? Use BankBazaar’s easy Personal Loan EMI calculator.