EMI is the fixed payment made by the borrower to the lender, which pays back the principal and the interest for each month. The loan is fully repaid within a specified number of years.
What is an EMI Calculator?
An EMI Calculator is a tool it helps you to calculate the amount you repay each month. For that, you can use the EMI calculator, which will help you calculate the EMI amount to get an idea of the monthly repayments you make towards these loans. The calculator has three sliders with the loan amount, number of months, and interest rate. So, when you enter these details, the calculator shows how much you must pay off each month within the selected duration.
Advantages:
When you apply for a loan, you should know if you are eligible for the loan or not. And this can be done with the help of a Personal Loan EMI calculator as it helps you calculate your EMIs, which will help you prepare and make the EMI payments on time.
Accessibility
You can use the EMI calculator anytime and from anywhere. This makes your budget calculations possible at a time of your convenience
Financial Planning
EMI calculations are done even before you start applying for your loan. In that situation, the calculator can help you with this.
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Factors Affecting Loan EMI
Change in interest rate
Loan interest rates can be fixed or floating. Sometimes the rate remains the same over the loan period, and sometimes it can change multiple times over the loan period. So this will change the EMI calculation for your loan.
Change in tenure
If you change your bank and carry over your loan, then your loan tenure will change in some cases. And eventually, it will affect your EMI calculation as the EMI will decrease if the tenure increases.
Prepayment of loan
If you prepay your personal loan online, the prepayment amount will be deducted from the original principal. This reduces your loan amount. And if the tenure is the same, the EMI can decrease or stay the same. In such a situation, the EMI used for repaying the principal will increase, lowering the original calculation.
