This is a user generated content for MyStory, a YourStory initiative to enable its community to contribute and have their voices heard. The views and writings here reflect that of the author and not of YourStory.
How to Calculate EMI of Your Loan Using Personal Loan EMI Calculator
A personal loan is an unsecured loan. However, calculations are essential before borrowing a loan. A Personal Loan EMI Calculator proves to be of great help when it comes to borrowing a personal loan amount.
This is a user generated content for MyStory, a YourStory initiative to enable its community to contribute and have their voices heard. The views and writings here reflect that of the author and not of YourStory.
An equated monthly installment is a combination of principal and interest amount. When a loan amount is borrowed, it is usually repaid in the form of EMIs. The dues are spread over a particular period so to make the process of repayment easier. The period known as tenor can range between 1-5 years and can be selected according to the repayment capacity. EMI in today’s time is the most common option when it comes to repayment of a loan. Before you borrow a personal loan, it is essential for you to speculate and determine the amount that you will pay on a monthly basis. For this purpose, a Personal Loan EMI Calculator is used.
This calculator helps in planning before borrowing a personal loan. It also helps to select the right amount of loan for a right tenor. Thus, Online EMI Calculators have made life easier.
Steps Involved in Calculating a Personal Loan Through an EMI Calculator:
There are various Non-Banking Financial Companies (NBFCs) and other lenders who offer the service of a personal loan. This service is available for all kind of borrowers ranging from students, salaried employees to self-employed individuals and business owners. If you are one of them and you wish to borrow a personal loan, then using a Personal Loan EMI Calculator is a must. This facility has been made available on the website. Thus, calculation of EMI has been simplified as all you have to do is simply visit the website of the lender. Here are steps as to how you can calculate Personal Loan EMI with the help of an EMI calculator:
a.) Check the Website: Almost all the highly rated financial institutions have EMI calculators integrated into their website. The best way to calculate your personal loan EMI is by visiting the website. Once you are there, simply search for an “EMI Calculator” tab. Various highly accredited NBFCs have a categorised feature of the same.
b.) Fill Up the Details: Once you are on the EMI Calculator page, then you will be required to fill in the details. These include the loan amount, rate of interest and the tenor. These variables are independent, and as you fill in the details, you will get an accurate EMI amount. You can easily check out the details by simply moving the bar.
c.) Knowledge About the Formula: Apart from the automatic calculation, you can even opt for a manual calculation. It is helpful to know how the manual calculation of a Personal Loan EMI works. If you wish to do it manually, then make use of this formula:
EMI = [p x rx (1+r)^N]/[(1+r)^N-1]
Over here: P = Principal amount
r = Interest
N = No. of months
Having understood how Personal Loan EMI Calculator works manually and automatically, it is time to understand how an EMI Calculator benefits you:
Error Free: It can be possible that when a calculation is undertaken manually, it might go wrong. However, if you choose an online EMI calculator, then the chances of error are next to none. Furthermore, the amount involved is high. Thus, it is essential to get the calculation right.
Quick Calculation: A manual calculation will require you to put in a lot of mental efforts. It will consume some time. However, with the online calculators, the calculation is instant.
Hassle Free: With the availability of Personal Loan EMI Calculator, you do not have to stress regarding the EMIs. These online calculators that are available through websites have a smooth interface, and they provide an instant result.
These were a few of the benefits of a Personal loan. It is essential to know that this online calculator goes a long way in helping you plan your loan. Thus, before you opt to borrow a personal loan, it is essential that you check Personal Loan EMI Calculator so to get a fair idea.