EMI Calculator Online
An Equated Monthly Instalment (EMI) calculator is an online tool that helps us calculate the EMI that needs to had paid towards a loan. It tells us to account for the interest rate, loan amount, and repayment tenure to estimate the monthly EMI. EMI calculators are useful for loan repayment, budgeting, financial planning, and comparing loan options. They are easy to use, user-friendly, and available online.
What is EMI?
Equated Monthly Instalment (EMI) is the fixed amount a borrower pays monthly to repay their loan. It has two components - the principal and the interest- and is usually paid monthly on a fixed date.
What is EMI Calculator?
An EMI (Equated Monthly Installment) calculator is a tool that helps calculate the monthly instalment amount to have paid towards a loan. It considers the interest rate, loan amount, and repayment tenure to estimate the EMI that needs to had paid.
Types of EMI Calculators:
There are various types of EMI Calculators that you can use to calculate your equated monthly instalments for personal loans, car loans, home loans etc.
Home Loan EMI Calculator:
Home loans have a huge loan principal amount and a long tenure. It is necessary strategic planning for its repayment. You can use the EMI Calculator for Home Loan to calculate your EMI. It is a user-friendly planned calculator that can help you immediately assess and calculate your home loan EMIs.
Car Loan EMI Calculator:
Buying a car is one of the main investments one can make. You may need a car loan to fund this substantial investment. Often, a car loan's EMI is supposed to repay with due interest within a stipulated time to the lender. Thus, you can use the Car Loan EMI Calculator to calculate a precise EMI amount you can provide to pay comfortably.
Personal Loan EMI Calculator:
Personal loans had mostly taken to serve multiple purposes like medical emergencies, vacations, relocations, weddings, home renovations, etc. Since they are unsecured loans, they have a relatively higher interest rate and a shorter tenure. You can use the EMI Calculator of Personal Loan to assess the loan and EMI amount you can easily pay. By entering your interest rate, loan amount, and loan tenure, you can calculate your EMI.
Education Loan EMI Calculator:
An education loan EMI calculator is a tool that helps you calculate the equated monthly instalment (EMI) that you would need to pay on your education loan. This calculation considers the loan amount, interest rate, and repayment tenure.
Loan against Property EMI Calculator:
A loan against property EMI calculator is a tool that helps you calculate the EMI that you would need to pay on your loan against property. This calculation considers the loan amount, interest rate, and repayment tenure. The calculator can also show you the total interest and amount payable.
How Can EMI Calculator Help You?
EMI calculator can help you plan your loan repayments, budgeting, and financial planning. It can also assist you in comparing different loan options and finding the most suitable one based on your financial capacity.
What is the Formula for EMI Calculator?
One can calculate EMI using the given below formula:
EMI = [P x R x (R+1)^N]/[(1+R)^N-1]
Where,
P = Principal amount (loan amount)
R = Monthly interest rate (calculated as Annual interest rate/12)
N = Number of monthly instalments (repayment tenure)
EMI calculators use the formula mentioned above to determine the EMI.
Example:
For example, Mr Rahul takes a three-year personal loan of Rs.300000. The interest rate for his borrowing is 15%. The calculator uses the above formula to determine the EMI payable value as Rs.10400. The total interest payable by Mr Rahul for his borrowing is Rs.74400.
You can apply the EMI calculator formula to different loans. The three variables – loan tenure, loan amount, and interest rate- are the EMI value's differentiators. The value of EMI is directly proportional to the interest rate and loan amount.
In other words, with an increase in the interest rate and loan amount, the EMI value of the loan also increases. However, EMI has an inverse relation with loan tenure. As the loan tenure increases, the loan's value decreases and vice versa.
How to Use an EMI Calculator?
Here are the steps to use EMI Calculator:
- Enter the interest rate, loan amount, and repayment tenure in the calculator.
- Click on the "Calculate" button.
- The calculator will display the monthly EMI, total interest payable, and the total amount payable.
- You can adjust the loan amount, repayment tenure and interest rate to see how it affects the EMI.
- You can utilize the EMI calculator to compare different loan options by calculating the EMI for each one.
Advantages of using EMI Calculator:
Here are the advantages of using an EMI calculator
Accurate Calculation:
EMI calculators provide accurate calculations based on the interest rate, loan amount, and repayment tenure.
Time-Saving:
It saves time by eliminating the want to calculate the EMI manually.
Budget Planning:
It helps plan the budget by estimating the monthly instalments paid towards the loan.
Hassle-Free:
It is a hassle-free tool that provides quick and easy results without any errors.
User-Friendly:
It is a user-friendly online tool that can be used by anyone, even those without financial expertise.
Online Availability:
It is available online, accessible from anywhere and at any time.
Easy Comparison:
It allows easy comparison of different loan options by calculating the EMI for each one.
Financial Planning:
It helps financial planning by showing the full amount and total interest payable over the loan tenure.
Flexibility:
It allows flexibility in adjusting the interest rate, loan amount, and repayment tenure to find the most suitable EMI.
An EMI calculator is a useful tool that provides multiple benefits to those looking to take a loan.
Conclusion:
Users should understand that EMI calculators are useful tools for planning and managing their loan repayments. By entering the interest rate, loan amount and repayment tenure, they can estimate the monthly EMI, full interest payable, and total payable. It helps in making informed decisions while taking loans.
Faqs:
What is the 40% EMI rule?
In short, if your income is 1 lakh monthly, your total EMI or equated monthly instalment, which is the method most people opt for repaying loans or any debts, should not be more than Rs. 40,000
How much EMI can I pay from my salary?
Generally, the EMI should be at most 50% to 60% of the borrower's monthly income.
Who introduced the EMI concept?
Kamath took retail lending to the doorsteps of the Indian household, leading to a boom in demand for consumer durables, realty and automobiles. He could well be the father of India's EMI culture.
What is the benefit of low EMI?
Additionally, when you pay a lower EMI amount, you free-up cash for other imminent expenses of your family or business. It will help you manage your expenses better and increase your monthly savings.
What is the golden rule of EMI?
The golden rule is to always pay 40% or 50% (depending on comfort level) of your monthly income as Home Loan EMI.