Monthly EMI: Rs. 1,000,00
A home loan EMI calculator is a digital tool that helps you ascertain the EMI you will incur due to a home loan.
Buying a home is a joyous occasion. A home loan will help you finance the purchase of the home of your dreams. To get the best experience out of your home loan, two things are very important: choosing a suitable lender and planning your repayment. A home loan EMI calculator helps you with both.
A housing loan EMI calculator computes the EMI you will be paying as repayment for the home loan. It uses three variables to calculate the EMI - the principal loan amount, the rate of interest, and the loan tenure.
Having an approximate idea of the EMI to be paid helps you plan out your repayment process in a better way. A housing loan EMI calculator also helps you choose a home loan that provides you the perfect balance of loan amount, rate of interest and tenure.
You may have come across the term ‘home insurance plan calculator’ often. However, it is quite different from a ‘home loan EMI calculator’. A home insurance plan calculator helps you determine the premium you will incur when you purchase a home insurance policy. Unlike a home loan EMI calculator, the home insurance plan calculator requires several details in regards to your home to deduce an accurate EMI estimate.
While a home loan funds you in the purchase of your house, a home insurance policy gives coverage against events that can damage your house. Well-designed home insurance plans protect you from damages caused by natural calamities such as earthquakes, storms, cyclones as well as manmade calamities such as theft and fire. Some companies offering home insurance plans also include fine arts, pet cover, accidental damage cover, and much more.
To know the estimated EMI of your loan with the help of a housing loan EMI calculator, you need to enter three vital variables:
The principal loan amount refers to the actual cost borrowed by you and lent by the bank or the NBFC. Generally, this amount is equal to 80 - 90 % of the total cost of your house. The principal amount has a direct relation with the EMI. So, the higher the principal amount entered in the housing loan EMI calculator, the higher will be the estimated EMI.
This is the second variable to be entered in the home loan EMI calculator. The rate of interest differs from bank to bank. It is the percentage of the amount that you would have to pay on top of the loan amount. On the calculator, you will be able to lower the interest bar only up to a certain number. This is the lowest rate offered by the lender. The final rate of interest prescribed to you will depend on several factors. There are two ways banks charge interest - simple and compound.
The loan tenure refers to the duration within which you plan to repay the loan. If you opt for a higher loan duration, you will incur lower EMIs as the repayment is being extended over longer periods of time. However, that would also mean that you have to pay interest for a higher period of time. So, do keep this in mind when entering the tenure in the housing loan EMI calculator.
With the home loan EMI calculator, you can find out the monthly interest you will be paying for your home loan in a matter of seconds. Here is how the calculator works:
To calculate your home loan EMI with our home loan EMI calculator, fill in the three boxes with the three variables as mentioned above - the principal amount, the rate of interest, and the loan tenure.
The housing loan EMI calculator will use this simple mathematical formula to calculate your home loan EMI: [ E = P * r * (1 + r)^n ] / [(1 + r)^n - 1]. Here ‘E’ is the EMI amount, ‘P’ is the principal amount, ‘r’ is the monthly rate of interest, and ‘n’ is the number of months in tenure.
After filling in the details, the home loan EMI calculator will automatically calculate and display the following amounts - your EMI amount, indicating your monthly installments; total interest, indicating the overall interest amount you will be paying on top of the principal amount; and the total amount payable, which is the overall total of the amount you will have to payid at the end of your tenure. Based on the results you are looking for, you can modify the variables as you like.
The home loan EMI calculator has several benefits which you can reap.
Comparison of interest rates
The housing loan EMI calculator gives you a better understanding of how exactly different interest rates provided by different lenders affect your finances and to what extent. With this, you can also choose the best interest rate as per your financial planning.
Help plan future finances
Once the home loan EMI calculator estimates the monthly payment for your home loan, you get better understanding of how you need to plan your upcoming finances. It also helps you to make a decision about your loan tenure and align it with your future financial decisions.
Easy and convenient
Since you can access this home loan EMI calculator at any time with ease, you do not have to worry about manually making any calculations or bothering yourself with complex math. You also need not bother your loan agent to know the EMI rates for different tenures.
Time-saving process
After you enter your variables, the housing loan EMI calculator displays the results in the blink of an eye. This saves you an ample amount of time as you are not required to make any calculations by yourself. You can keep entering desired values into the variable boxes and the calculator will display the results just as quickly as you enter the amounts.
Error-free calculations
A human may make a mistake but a machine cannot. This housing loan EMI calculator has been programmed for only one thing: to calculate the EMI. It cannot forget the formula or make any miscalculations, that is how you know that you will always get error-free calculations for your home loan EMI.
Provides an estimated number
A home loan EMI calculator only provides the user with an estimated figure of the monthly interest. The lender may base the actual EMI on several factors, so it is possible that the EMI amount provided by them may differ. However, the housing loan EMI calculator gives a basic and approximate idea of how much the amount will be.
Provides the total interest amount
The calculator also helps you understand the total interest amount that you will be paying on top of the principal amount while repaying your loan. This can help you understand and compare the different interest rates provided by different lenders.
Rate of interest may differ
Depending on the calculator web page you are using, you will be able to reduce the interest rate only up to a particular number, which will be the lowest rate of interest offered by the lender.
To compute the EMI, the housing loan EMI calculator requires three variables: the home loan principal amount, the loan tenure, and the rate of interest. Once you enter the three variables, the home loan calculator provides quick results every time.
In many cases, the collateral for the home loan is the home itself. However, in certain cases, the lender might ask for other types of collateral. A talk with your agent might be the best way to ensure what it is you are signing up for. Do note that the rate of interest you are offered will also depend upon the collateral. However, this is not something that you need to consider or enter when estimating the EMI through the housing loan EMI calculator.
Knowing the EMI in advance helps you to plan out your repayment in a better way. Since you are aware of how much you will be approximately paying each month, you can budget your monthly finances accordingly. The knowledge of how much EMI each type of loan will incur also helps you to choose the home loan most suitable for you. Therefore, if you are planning to buy a home loan, it is very beneficial to use a housing loan EMI calculator.
No, it is not legally required for you to purchase a home insurance plan when applying for a home loan. Though there are some lenders who necessitate it, there is no legal decree that mandates it. However, buying a home insurance policy can be immensely beneficial to you in the long run.
With a home insurance policy, your house is protected against natural calamities, fire, theft, accidental damage, and so on. IFFCO Tokio’s home insurance plans can be purchased by homeowners as well as tenants, thatand cover several essential belongings including fine arts and decor.
No, there is no need to upload any kind of documents to use the home loan EMI calculator. You only need to enter the three variables - the principal amount, the rate of interest, and the loan tenure.
