For all those who are not well-known to Home Loan EMI Calculators, which generally help you calculate Equated Monthly Installment for a home loan plan, here is something that will surely give you tips and enhance your knowledge for sure. Home Loan EMI Calculators are basically the loan amount that you need to repay within the completion of your loan tenure. The assumption should be that there is no change in the provided interest rate.
There are ample of EMI calculators available online. You get a personal choice to select the best and convenient calculator for yourself. The process to calculate is very simple. All you need to do is enter the total loan amount, and then add the rate of interest that is applicable on your home loan plan. Enter the tenure of the loan in months.
You need to be clear in your mind whether you are paying in advance or not at the month starting or at the end of the month. Once you submit all these details, the EMI Calculator will calculate everything that you need to aware of including amortization tables for the loan duration. Calculating the EMI amount is a different part but apart from the calculation, going in for the right scheme of loan is a very important thing to take into consideration. If the scheme of loan you opted for is not the right one, it will surely increase your financial pit hole rather than covering it up. You will have no option left than continuing with the scheme you have selected. So it’s better and recommended by professionals to verify, cross-check, and gather all necessary information and select the correct plan.
Don’t sign in the final agreement or documents without knowing and comparing the interest rates and the EMI you have to pay. To make your EMI payments in time you will have to manage your monthly expenses and rather cut short all unnecessary expenses. If you spend on luxuries more than your income, you will have to pay a high price in covering your loan amount. This will make a negative impression on your goodwill. You can’t afford this if you have a negative impression and bad credit rate.
Why an EMI Calculator?
There are many benefits of an EMI calculator:
- Easily calculated EMIs is the foremost benefit of an EMI calculator. It saves you from the hassle of calculating it yourself and explicitly tells you how much you have to pay every month.
- An EMI calculator makes it easier for you to compare different loans and helps you choose which one’s the best and most affordable for you on a monthly basis.
- It helps you with your loan management. When the EMI calculator tells you how much you have to pay in EMIs, you make sure that you cut down your expenses to pay your EMIs on time and avoid a negative impact on your credit score.
- It helps you choose the right tenure. If you feel like the EMI amount is too much, you can increase your tenure and regulate it until the EMIs are conveniently affordable for you.
Factors Affecting EMIs
- First and foremost, your EMIs depend on your Principal amount. The principal amount is the amount for which you apply in the initial stage of a loan process.
- Secondly, your EMIs depend on your tenure. The shorter the tenure, the more you will have to pay in a month. Therefore, it is always advisable to go for a longer-term. While the tenures offered to differ from bank to bank, the highest tenure offered is 30 years.
- Third, it depends on your interest rate. If your interest rate is lower, your EMI amounts will be lower and vice versa. The interest rates offered may again vary from bank to bank, so it is best that you choose the bank that provides the best rates.
- Fourth, it depends on your down payment, which is the initial payment you make for a loan. If you make a bigger down payment, it will help you reduce the burden of the remaining loan amount and reduce your EMIs.
- The processing fee charged by the banks to process your loans also affects your EMIs. A higher processing fee increases your EMI amount.
- Your choice of interest rate is also a factor. If you choose a fixed interest rate, it will charge you 1% to 2.5% more than the floating rate but your EMIs will be fixed. But if you choose a floating interest rate, your EMIs will fluctuate according to the increase or decrease in the lending late.
- Last, if you avail the prepayment option, it will help reduce your outstanding loans and thus reduce your EMIs.
What is Pre – EMIs?
Your loan amount is usually disbursed in stages until the entire loan amount is disbursed by the lender to you. Till only a part of the amount is disbursed, you will have to pay EMIs only on the disbursed amount. These are known as pre – EMIs. Paying of pre – EMIs will help you reduce the burden of your EMIs.
So to solve all your hassles, you need to see that you pay all your loaned amounts and debts on time or before time. Also, it is recommended to read carefully and go through all the documentation and terms and conditions before finally signing it and moving forward with it. Once you have made a final agreement you cannot step backward and have to deal with all the cons. Your financial institutions will surely offer you an EMI calculation, its better you use it and get user friendly with it.
So this is about the Home Loan EMI Calculators. It’s better to try and test things before jumping into it without any information. EMI calculators will help you know how to save the exact figure required for repaying your loan. Help yourself get the best.
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