3 EMI Warning Signs: Is Your Debt Out of Control?

Paying EMIs on time is not enough. If your total loan burden eats too much of your income or leaves no savings buffer, your debt is already risky — even if no EMI is overdue.

Here's what happened: India's household debt has grown sharply as personal loans, car loans, and buy-now-pay-later options became easier to access.. Many salaried Indians are now servicing 3 or more EMIs simultaneously — home loan, car loan, and personal loan at once.. Financial experts flag that on-time payments alone don't signal financial health — your savings rate and emergency fund matter equally..

What you should do: Calculate your EMI-to-income ratio today: add all monthly EMIs and divide by your take-home salary — anything above 40% needs immediate attention.. Check whether you have at least 3 months of expenses saved separately as an emergency fund before taking any new loan.. List all active loans with their outstanding balances and interest rates — consider prepaying the highest-rate loan (usually personal loan) first..

Your FOIR (Fixed Obligation to Income Ratio) should stay below 40%. Most banks quietly reject or price loans higher when it crosses 50% — even if your CIBIL is 750+.