When you apply for a home loan, one of the topmost thoughts in your mind would be how can I repay the amount within the stipulated time, right? The lenders give you the flexibility to repay the amount in smaller instalments known as Equate Monthly Instalments or EMIs over a period of 15-30 years.
The EMI is a fixed amount that you must pay every month throughout the loan term or until you repay the full amount. The EMI you may include two components – the interest amount and the principal amount. And, since repaying a home loan is a long-term financial commitment and responsibility it is best to know the exact amount you must pay before you sign the loan documents. This allows you to prepare your monthly budget accordingly and manage the repayment more efficiently.
And the best way to calculate your home loan EMI is to use the loan EMI calculator, which is also commonly referred to as home loan calculator. It is a simple and easy-to-use online tool that allows you to compute the EMI payable based on the specific inputs you provide. It essentially requires the following information –
- The loan amount (i.e., the amount you want to borrow)
- The loan tenure
- The interest rate
Benefits of using a home loan calculator
Accurate results and highly reliable
When it comes to planning for your home loan, you cannot afford to go wrong with your calculations as it can have a significant impact on your financial planning. When you manually calculate the EMI, there is always a risk that you could commit some error and you may get an inaccurate figure. To avoid such a situation, it is best advised to use the home loan EMI calculator that gives you accurate results every single time.
With manual EMI calculations there is not only a risk of fallacy, but the process may also be pretty time consuming. Instead, you can use the online EMI calculator and get the results instantly. You can even change the inputs multiple times and get fast results about the EMI for different loan term, and amount.
Allows efficient financial planning
This is probably one of the most important benefits of using a home loan EMI calculator. It allows you to steer clear of financial hassles in the future. By knowing the EMI beforehand that you must pay every month, you can plan your budget accordingly and borrow a suitable amount so that the EMI is affordable.
Easy to use
Apart from providing accurate and instant results, the home loan EMI calculator is an easy-to-use tool. You need not have any technical expertise to use it. Most lenders have this calculator on their website and all you must do is type the inputs and the tool does the rest.
Allows you to compare the loan offers in a better way
Different lenders offer home loans at different interest rates. Remember, even the smallest margin of 0.5% in interest rate can have a significant amount on the overall interest payment in the long run. You can save a valuable amount if your home loan interest rate is lower by 0.5% than the interest offered by another lender.
By using the home loan EMI calculator, you can easily compare the EMIs for different interest rates and make an informed decision in terms of choosing the right lender.
Thus, a home loan EMI calculator allows you to get the most out of your home loan and facilitates efficient planning so that repayment is easy.