According to a report by TransUnion CIBIL, India saw a marginal rise in home loan defaults in the last 2 years. Thus, if you are planning to avail a home loan, you must ensure that you can pay it comfortably within tenure to avoid the risk of default.
Calculating your EMI amount before availing an advance, for instance, can help you in planning your finances for the future. An online home loan EMI calculator is the perfect tool using which you can calculate your repayment amount and gauge the loan’s affordability.
What is an EMI calculator?
It is an online tool that uses parameters like your loan’s principal amount, interest rate and tenure to calculate home loan EMI amount you need to pay. The calculator uses the following equation to give your EMI amount.
EMI = [P x R x (1+R)^N]/[(1+R)^N-1]
Where P gives principal amount, R the rate of interest, and N the number of monthly installments.
Why should you use it?
Using an online home loan EMI calculator before finalizing home loan can help you to avail the following benefits –
It gives you the accurate EMI amount you have to pay, thus helping you to make better financial decisions.
You can avail it without restrictions and thus calculate your EMI multiple times until you are satisfied with the amount you can repay.
It is fast and efficient and helps to save yourself from the cumbersome process of calculating your repayment amount manually.
Thus, using this EMI calculator comes with multiple benefits that can make the process of availing a loan significantly easier. However, it is crucial to enter each detail in the calculator accurately to get your exact EMI amount.