All about different EMI calculators – Home loan EMI, Personal Loan EMI, Car loan EMI

Did you know? India’s credit industry is one of the largest in the world. We all know how important a loan is. The loan is generally taken to fulfil our personal and financial goals. But every loan taken from a lender needs to be paid back. Both the principal amount and the interest amount are to be paid back.  

Hence, the repayment of the loan is categorised accordingly. A loan taken to build a house comes under a home loan. Similarly, a loan used to purchase a car is classified as a car loan. The repayment time of the loan is decided by the borrower. For instance, one year, five years, and so on.

To calculate the repayment of a home loan, car loan, or personal loan, lenders use Equated Monthly Instalment (EMI) methods. An EMI calculator is used for this purpose. Based on the loan principal, interest rate, and loan tenure, an EMI repayment amount is decided. The EMI repayment is to be paid every month by the borrower until the loan period is over.

Do you know? Your loan EMI is subject to change. Why? Because the interest rate is decided by banks as per the prevailing repo rate (the rate at which the RBI lends money to commercial banks.) If the RBI increases the repo rate, the EMI interest rate goes up. If it decreases, it goes down.

In this article, we will learn about the different types of EMI calculators used by lenders and banks. We will also understand why EMI calculators are important for both lenders and borrowers.

Different Types of EMI Calculators

Generally, there are three types of EMI calculators. These are the home loan calculator, personal loan calculator, and car loan calculator. Let us know the different types of EMI calculators.

• Home Loan EMI Calculator

Since home loans are huge in amount and carry a higher repayment tenure, they require a lot of understanding and structuring. The best way to plan and execute your repayment strategies is to use a home loan EMI calculator.

EMI calculators are easy to use. It gives borrowers a repayment figure to consider for the loan taken. This helps borrowers assess loan payments effectively. All you need is the loan amount, the tenure of the loan, and the interest rate charged by the lender or bank. It is recommended to always use a good EMI calculator for your loan value calculation.

• Car Loan EMI Calculator

One of the most common loans being taken in India is a car loan. Investing in a car is one of the most preferred expenses a person can make. Like any other loan, a car loan carries a principal and interest amount. These amounts have to be paid to the lender.

A car loan EMI calculator is an effective tool for assessing your repayment options. One should always decide on a repayment option according to their paying capacity. Failing to do so could land you in trouble. Just input your car loan amount, interest rate, and loan tenure in the EMI Calculator to know the exact EMI value.

Did you know? If you fail to repay your car loan, the car can be seized by the lender. And the car could be auctioned off to ensure the amount is recovered. Invest wisely, and make sure you repay your EMIs on time.

• Personal Loan EMI Calculator

A personal loan is of many types. A personal loan is also taken for multiple purposes. For example, medical emergencies, holiday vacations, major home retrofitting, etc. Since most lenders consider personal loans to be insecure, they carry a higher interest rate.

Personal Loan EMI Calculator is the best solution to know and asses your loan amount. Accordingly, you can pay your loans with ease. You just need to put in your loan amount, loan tenure, and the interest rate charged by the lender. Putting this info. The personal loan EMI calculator will give you the exact repayment value of the loan you have taken.

Why is an EMI calculator helpful?

• EMI calculator helps you calculate your exact loan repayment amount. With the exact amount, you can determine your capacity to pay.
• It saves a lot of time and confusion around loan repayment value.
• It helps you avoid misunderstandings regarding your payment value since calculators give you the final amount.
• It not only gives you an accurate estimate but also helps you determine the tenure and interest amount to be paid every month.
• There are different types of calculators for different types of loans taken. For instance, a home loan calculator and a car loan calculator.
• EMI calculator is used both by lenders and borrowers, so you know how important it is.

Conclusion

From the above context, it is very clear that EMI calculators are an important tool for loan value calculations. There are primarily three types of EMI calculators. Like a home loan EMI calculator, a car loan EMI calculator, and a personal loan EMI calculator. It helps us in many ways. The EMI calculator gives you an exact value estimate, helps you assess your loan repayment capacity, and so much more.

Moreover, both lenders and borrowers use loan EMI calculators. It gives an accurate figure and detailed assessment to the user. Do remember that EMI values can be subject to change as per the RBI repo rate. A higher repo rate invites higher interest rates, and vice versa.

Having said the above, I’m sure our readers are well aware of the Piramal Finance website. It has a whole lot of information on personal and housing finance advice. Do hit the link and open up an exciting world of financial solutions.