The dream of being a proud homeowner is cherished and to make this aspiration a reality, many seek the help of a home loan. Buying a home is an investment that requires a lot of financial commitment and foresight, which will help you stay on track while you pay off your home loan.
The responsibility of buying a home does not end after the initial purchase. Borrowers must diligently follow their EMI schedule and meet other loan costs to avoid default and jeopardize their valuable property. Therefore, we emphasize the importance of having a clear repayment plan when borrowing.
Having a repayment plan laid out in front of you helps compartmentalize your future expenses and obligations without compromising your savings and the needs of your family. This can be achieved by knowing how to calculate your home loan EMI, which gives you a clear picture of how long it will take to close your loan. You can either perform this calculation manually or use a
home loan EMI calculator which allows you to select the interest rate and the duration of your choice to offer you different repayment scenarios.
Still not sure how to calculate your home loan EMI? Read on to find out more.
What is the EMI home loan?
The equivalent monthly payment, or EMI, refers to the amount of money you pay monthly to pay off your home loan. Your lender sets the EMI based on factors such as the principal loan amount, home loan interest rate, and loan term. Each IME includes a principal component, as well as an interest component, which change over your duration. Short-term home loans result in faster repayment but with high EMIs. In contrast, long-term home loans offer comfortable repayment on a monthly basis.
How to Calculate the EMI Home Loan
The formula for calculating the EMI on a home loan is as follows:
NDE= [P × R × (1 + R) ^ N]/ [(1 + R) ^ N-1]
Where P = Loan Amount or Principal
R = Interest rate per month [if the interest rate per annum is 11%, then the rate of interest will be 11/ (12 x 100)]
N = Number of monthly payments
However, you also have the option of calculating your EMI in an easier way, using online calculators such as the Bajaj Housing Finance Home Loan EMI Calculator. This is a simple online tool that calculates your EMIs based on the basic information you enter – the amount of loan you need, the length of your desired loan and
home loan interest rate . Note that most major lenders offer a flexible loan term of up to 30 years.
Benefits of Using an EMI Home Loan Calculator
There are several advantages to using an EMI home loan calculator. Some of them include:
1. Easy to use
The Home Loan EMI Calculator makes calculating the EMI to be paid on your home loan easy and accurate. As mentioned above, the user only needs to enter the important fields such as principal amount, loan term and interest rate, and the calculator will work out the EMI amount based on the information provided. Using the calculator also eliminates the margin for human error and gives you clear numbers on which to base your repayment plan.
2. Complete details of your EMI home loan
The EMI Home Loan Calculator also offers key details about your EMI Home Loan. It allows you to see what percentage of the amount you are required to pay is accrued interest and what is the principal loan amount.
3. Match with better lenders
Each potential borrower will have several lenders in mind, and by already knowing your repayment capacity, you can choose among these lenders, make an informed decision, and select the one whose rates and offers are the most competitive and advantageous for you.
Calculate EMI Home Loan Made Easy Today
Using the EMI Home Loan Calculator helps you sift through your choices and select the right home loan offer. More importantly, knowing your EMI helps you prepare an accurate repayment schedule that you can stick to without hesitation.
Once you have all the necessary information, go ahead and apply with one of the leading lenders in the market. One such lender is Bajaj Housing Finance Limited. The HFC offers home loans from 6.70%* per year for salaried and professional candidates. Visit their website today to
apply online .