How Home Loans Helped a Supply Chain Director Launch His Business

Amit Verma*, a seasoned Supply Chain Director, had always nurtured an entrepreneurial ambition. However, with two ongoing home loans at interest rates of 10% and 12%, his financial obligations seemed to stand in the way. With a total loan burden of INR 1.2 crore and EMIs amounting to INR 1.5 lakh per month, he had limited flexibility to fund his business aspirations.

Recognizing the need for strategic financial restructuring, he sought expert guidance to optimize his debt and unlock capital for his venture.

Challenges

• Two home loans at high-interest rates (10% and 12%).

• EMI burden of INR 1.5 lakh per month with only 15 years of tenure remaining.

• Lack of available capital to invest in his business.

• Need to create a financial safety net for his children's future.

The Strategy

To enable Amit’s entrepreneurial journey, a structured financial plan was executed:

1. Loan Transfer to NBFC for Lower Interest Rates: The first step was transferring his home loan to a Non-Banking Financial Company (NBFC), which reduced his interest rate to 8.0%. This significantly lowered his EMI burden by INR 80,000 per month.

2. Strategic Loan Booking for Additional Capital: With the reduced EMI, an additional loan was booked with an EMI of INR 20,000 per month, ensuring liquidity for business investment.

3. Closing the High-Interest Home Loan: The smaller home loan, running at 12%, was closed entirely, further alleviating financial pressure.

4. Business Investment & Growth: The freed-up capital was strategically invested into his business, which by the end of the year, began generating an annual cash flow of INR 10 lakh.

5. Building a Financial Safety Net: Amit started directing his rental income into investments dedicated to his children’s future, securing their education and long-term financial stability.

Results & Impact

• Monthly EMI reduced by INR 60,000, improving cash flow.

• Successfully secured capital to launch a business, generating INR 10 lakh annually.

• Eliminated high-interest financial liabilities, improving financial health.

• Established a long-term investment plan for his children’s education and future security.

Conclusion

By restructuring his home loans and strategically reallocating funds, Amit* successfully transitioned from a high-debt position to financial independence. His proactive financial planning not only enabled his entrepreneurial aspirations but also strengthened his family’s long-term financial security.

This case study underscores the power of smart debt management in unlocking new financial opportunities, proving that with the right strategy, financial constraints can be transformed into growth enablers.

*Name changed due to non disclosure agreement