A personal loan EMI calculator is a great tool to plan your borrowings. Any EMI calculator uses three variables to determine your monthly installment for any loan, from personal to home to business.
- Principal amount of the loan: The aggregate sum you need to acquire is your principal amount. During the initial years, your contribution towards the principal amount is lesser than that towards the interest, determined by the outstanding sum.
- EMI Rate of interest: There are three methods by which a bank can charge interest—decreasing monthly rate, decreasing yearly rate, and per day decreasing rate. Banks mostly use the daily reducing method for home loans, while some financing organizations utilize the monthly reducing technique.
- The number of years: Your reimbursement over the tenor is displayed in a credit amortization plan, a detailed description of how much interest and principal you pay over the number of months you decide to take a loan.
How is your EMI calculated?
You can easily calculate your installment using an EMI calculator:
To compute your EMI, enter the advance sum, rate of interest, and several years, and your EMI is immediately shown on any loan EMI calculator. You can enter credit sums from 50,000 to 4,000,000 and term from 1 to 5 years.
To determine the EMI amount, you have to put the three values determining the amount. By decreasing the loan amount or the EMI rate of interest, you can lower the EMI amount. You could also keep both the values constant and expand the number of years. However, if you wish to close the loan in the least possible time, you could consider adding more loans or decreasing the number of years.
What are the benefits of a loan EMI calculator?
Easy to Access: Most online EMI calculators give you the alternative to see and download the total amortization plan. This will assist you in deciding the interest and principal amount over the total time of the credit.
Quick results: The online EMI calculators can do complex calculations in only a couple of seconds, which in any case would have required hours with a paper and pen, helping you make a quick decision. Since there is no human intervention, the estimations are 100% precise.
Error-free: While calculating the EMI physically or in Excel, you may make blunders in the formula or the estimation. In any case, EMI calculators consistently give you precise outcomes with no chance of slip-ups.
Helps plan: Using calculators to decide the EMI before taking an advance encourages you to plan your monthly finances carefully.
Gives DIY results: One of the striking highlights of an online EMI calculator is that it can be modified to your prerequisites. You may continue exploring different combinations: sum, advance term, the EMI rate of interest to get results designed to suit and custom-made to your necessities.
If you plan to apply for a personal loan and want to use an EMI calculator, try CRED’s personal loan calculator that is guaranteed to show accurate results as per your desired loan amount, tenure, and bank interest rates.