Pay borrowing with high interest rates first

Borrowings with higher interest rate must be paid back first. Credit card advances are expensive when compared to personal loans. You should be mindful when spending using your credit cards and ensure that you payback the credit card outstanding as early as possible considering the high interest rates and other finance charges attracted in case of delayed payments.

Say no new borrowing

Excise caution with fresh loans or borrowing money. Consider-reconsider your existing/ongoing liabilities and repayment ability in event of any unexpected interest rise.

Failing to payoff your home loans timely spoils your credit history and affects your other borrowings. In worst case, it can mean loosing your priced possession to the lender. Hence, it is necessary that you lay an integral plan to manage your new/existing borrowings and repayment on various loans.

According to RBI norm for asset classification, if a borrower defaults on any one of the bank advances, all other borrowings by the respective borrower would be classified as NPA by the lending bank.