A home loan is undoubtedly a high-value credit and one of the biggest financial commitments one can undertake. Before opting for such loans, one must carefully consider their finances and affordability. Moreover, borrowers need to be aware of the monthly obligations and ensure that it does not create any financial burden.
In this regard, to understand the nature of EMIs, borrowers can take the help of an online instrument named home loan EMI calculator. With the help of this beneficial online tool, borrowers can evaluate their EMIs and interest components with ease.
What is a home loan EMI calculator?
A home loan EMI calculator is primarily an online tool that assists loan borrowers in calculating the EMI amount and interest component on the basis of loan amount and tenor. This online instrument is available on most lenders’ websites, and borrowers can make countless permutations and combinations of interest rates or tenors to determine an affordable EMI.
In this calculator, individuals just need to input the loan amount, tenor and applicable interest rate to find the most suitable EMI for them. Following is the formula used by the home loan EMI calculator to calculate the EMIs:
EMI = [P x R x (1+R) ^ N] / [(1+R) ^ N-1]
Here, P stands for principal amount, R denotes interest rate and N refers to the tenor.
Benefits of home loan EMI calculator
Before knowing how to apply for a home loan, individuals must use this online calculator beforehand to get a fair idea about their monthly obligations. Here’s providing a quick rundown of the advantages of this calculator:
Accurate and convenient to use
When considering home loan planning, one can’t afford to make errors. Usually, manual calculations provide erroneous results. However, using this calculator allows one to get accurate results all the time.
Provides faster calculation
Manual calculations can consume significant time. However, with a home loan EMI calculator, one can perform these calculations with a single click. There is no requirement to double-check the calculations.
Helps financial planning
Since this calculator allows borrowers to input interest rates, tenor and the loan amount, they can clearly understand monthly instalments towards the loan. With this idea, borrowers can conveniently plan their budget, keeping the amount in mind. Moreover, it displays the accurate EMI amount so that one can plan his/her budget so that the essential monthly expenses remain unaffected.
Helps in comparing different rates
Interest rates on home loans vary across lenders. If there is little change in the interest rate, it can significantly reduce the EMIs and the associated charges. This home loan EMI calculator allows borrowers to compare interest rates presented by the lenders.
No requirement for personal details
While using this online tool, borrowers need not worry about their security issues as they are not required to reveal their identity anywhere, which makes this instrument completely secure.
Although borrowers need not produce any personal details or meet any eligibility to use this calculator, one must definitely learn about the essential documents required for housing loan to ensure hassle-free approval.
In this regard, one can apply for a housing loan from leading housing finance companies. They can also benefit from exclusive pre-approved offers on various financial products, such as home loans, loans against property, etc.
By availing of these offers, existing borrowers can dodge the hassle of extensive documentation and expedite the loaning procedure. Therefore, prospective borrowers can check their pre-approved offers by submitting their names and contact details.
Therefore, the best part of using a home loan EMI calculator is that it allows borrowers to conveniently calculate their monthly obligations without much interference. After evaluating multiple EMI options, one can make an informed decision and choose the right loan amount.
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