Taking out a personal loan might sound easier, especially when your credit score is high and all the necessary income certificates are in place. However, if we consider realistic situations, one has to cover many hurdles and roadblocks before the loan application gets approved. Besides, the loan isn’t something you think about last night and get done by tomorrow afternoon.
Yet, taking a loan without complete knowledge of its various attributes can be problematic. You have to work on getting all the documents for the personal loan and understand the aspects of paying monthly installments, interest rates, etc. Besides, if you take a secured loan, the asset you kept as collateral will get forfeited if you fail to pay the installments.
This article will explain how a personal loan calculator can help solve most of your problems and guide you to make a well-informed decision.
What is a Personal Loan and Why Do You Need It?
A personal loan is a type of credit you can take from any creditor or bank to fulfill any financial crunch or meet any personal goal. It is primarily divided into two types: secured and unsecured personal loans. If you opt for a secured loan, you need to keep something as collateral that will guarantee the creditor the repayment through the fortification of the asset in case the borrower fails to pay the installments after repeated notices. In contrast, an unsecured loan doesn’t ask for any collateral, but the interest rates are pretty high and also depend on your credit score and income proof.
What is a Personal Loan Calculator?
As the name suggests, a personal loan calculator is a simple piece of software that takes multiple inputs, like the principal amount, the number of repayment years or months, the type of personal loan, and so on. Then it returns a value for the EMI you have to pay monthly based on the interest rate and input details you gave. It’s almost like running an automatic instrument through software, where everything can be calculated easily.
How a Personal Loan Calculator Can Help You Make a Well-informed Decision?
There are multiple benefits to using an EMI calculator. So without further ado, let’s look at some of the benefits of using the loan calculator.
- You can easily know the monthly EMI to be paid for a certain principal amount you want for your personal loan. There is no need to wait for the concerned creditor to respond to your quote request.
- Using the loan calculator is quite easy. You won’t have to give confidential personal information like bank card details, ID proof, bank account details, credit card information, etc. So the tool is safe and secure to use.
- You don’t have to pay to use this tool. Most EMI calculator software programs come for free and allow people to calculate their EMI installments without extra charges.
- Another significant benefit of using personal loan calculators is that the software programs will let you check how the EMI varies according to your credit score, type of personal loan, repayment term, and several other attributes. So, you can choose the best personal loan based on how easy it is for you and how much you can afford to pay each month.
- Since these calculators are hassle-free, you won’t have to spend hours understanding how they work and using them to calculate the approximate number of installments per month. As you can make a proper decision with the values known, the loan application and approval process can be completed much faster.
Which is the Best Personal Loan Calculator You Can Use?
There are many personal EMI calculator tools online, so finding the best one is a cumbersome task. But unless and until you already have a plan in place, you won’t be able to choose the best tool and may even end up using software that never displays accurate results. So, to help you out of this dilemma, we have shared some insights about finding the best calculator for a personal loan.
- First things first, you need to understand that a calculator is a simple tool that takes the principal amount, the time, and the type of loan you want to take out.
- Once you give all the inputs, you click the search or calculate button, and the software runs a back-end program to display the results. Therefore, it’s crucial to check if the program is coded in a way to display the most accurate results or not. If there is no accuracy and precision in the loan EMI displayed on the screen, it can lead to problems later on.
- Creditors offer different types of personal loans. Secured and unsecured loans are the two major classifications, to begin with. The interest rate will be higher for unsecured loans than for secured loans. Similarly, an unsecured personal loan can be further classified into more categories. Therefore, the personal loan calculator must have a dropdown showing options for the different personal loan types.
- Another thing you must worry about is the calculator’s security. Sometimes, you have to input personal information like a birth date, name, email ID, and so on to use the tool. Doing so can jeopardize these information sets, mainly if any trustworthy regulatory authority does not supervise the device. That’s why you should always use a reliable and secure calculator.
In this article, we have taken you through some of the most important details about a personal loan calculator. The software tool might vary from one platform to another, but it will have certain features that are common and required for giving an estimate about the EMIs, interest rates, and others. If you still have any problem understanding the role of a calculator or want to try the most accurate calculator, you can connect with the experts at Piramal Finance. They will help you understand the loan calculator’s use in detail and also guide you through the entire process.