Ever-rising inflation has put pressure on individuals from meeting their financial requirements. In such situations, many people are opting to avail a Personal Loan to bridge the gap between their needs and the means to fulfill them.
A Personal Loan is a short-term unsecured borrowing tool requiring minimum documentation. Being an unsecured mode of finance, you don’t need to pledge any asset as collateral. If you, too, are looking forward to avail a Personal Loan you must have already started shortlisting your preferred lender based on the loan eligibility criteria as well as the maximum loan amount offered.
EMIs – an important consideration
But merely calculating the Personal Loan eligibility criteria is not enough. You will also need to evaluate how much you are willing to pay on a monthly basis for availing a loan. Personal Loans, like other loans, are paid off in the form of equated monthly installments (EMI). EMIs are typically made up of the principal amount distributed throughout the loan tenor, and the applicable Personal Loan interest rate charged by the lender.
You can also choose to opt for a Flexi Personal Loan that comes with interest-only EMIs where you can pay only the interest component as EMI and pay the principal amount at the end of the loan tenor. This greatly reduces the EMIs to be paid.
While choosing a longer loan tenor entails lower EMIs, a short tenor reduces your interest outgo. You can utilize a Personal Loan EMI calculator for calculating the monthly payment amount.
What is an EMI calculator?
It is an online tool which considers the principal amount, rate of interest and loan tenor to calculate the payable EMI.
How to use an EMI calculator?
To calculate your EMI, simply enter the required loan amount, loan tenor in months, and the applicable rate of interest in their respective fields. The calculator will utilize this information and display you monthly payment amount.
It is advisable to also check your eligibility for the loan with a Personal Loan eligibility calculator from your preferred lender.
What are the advantages of utilizing an EMI calculator?
Accurate Projection of EMI – While you can manually calculate the EMIs by utilizing the EMI formula, a manual calculation is susceptible to comparatively more errors than an automated process. Utilizing an EMI calculator will minimize this risk and produce an error-free outcome.
Ease of Use – This tool is easy to use, requiring no mathematical calculation on your end. You simply need to enter the numbers in the required fields and the calculator will do the rest.
Quick Results – While manual calculation might require you to verify and check your results repeatedly, an online calculator will generate the results accurately, and in just a few seconds.
Customizable – These tools are customizable, and you can tweak the principal amount or loan tenor as per your requirements and still be assured of quick results.
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