16 Prepaying Home loan The 25 bps rate cut by the RBI notwithstanding, no lender has talked of lowering the rate of interest on home loans. So, if you are an existing borrower and can afford to prepay your home loan in part or in full, better do so and save on the interest outgo. What’s more, there is no prepayment penalty on home loans either. But prepayment also has its tax implications. Here’s a home loan prepayment plan for the next financial year