A personal loan is a wonderful credit instrument for meeting instant fund requirements. The loan amount availed through a personal loan can be utilized for a host of purposes. Be it dealing with financial or medical emergencies, managing wedding expenses, funding children’s higher education, home renovation or debt consolidation, a personal loan can prove to be of great help in any of these situations. Moreover, you can also consider availing a personal loan, if you are an entrepreneur looking to avail funds for meeting your business requirements. Another major benefit of personal loans is that they are unsecured loans. Therefore, you do not have to worry about pledging collateral while availing a personal loan. When you avail a personal loan, you must make sure that you repay the loan amount within the stipulated time frame. Timely repayment will not only help you clear your debt but also allow you to keep your credit score intact.
Calculate Your EMI Beforehand
Calculating your EMI beforehand can help you make timely repayment of your personal loan. Having an estimate of your EMI will allow you to plan your monthly budget wisely. You can calculate your personal loan EMI by using an online personal loan EMI calculator. This will give you a fair understanding whether you are in a position to afford the loan.
Let us have a look at how you can calculate your monthly installment using a personal loan EMI calculator.
You can calculate your personal loan EMI with the help of 3 parameters, i.e., loan amount, loan term and interest rate. All you have to do is enter these values into the online EMI calculator and get an estimate of your monthly installments. To obtain an EMI that best suits your needs, you can use various permutations and combinations of these three inputs.
The formula to calculate the personal loan EMI is mentioned below
E = P x r x (1+r) ^n/ ((1+r)^n-1),
- E stands for EMI.
- P is the principal amount that you want to borrow.
- R is the monthly rate of interest
- N is the repayment tenure in months.
Now that you have a fair understanding of how to calculate your personal loan EMI, let have a quick look at some of the major benefits of using an online EMI calculator:
Benefits of using a Personal Loan EMI Calculator
- Using an EMI calculator before availing a personal loan makes loan planning easier for you. You also get an idea regarding how much loan amount you should apply for.
- Using an online EMI calculator is very simple. It saves time and energy spent on doing manual calculations.
- The output provided by the EMI calculator is error-free. Therefore, you can get a proper estimate of your EMI and plan your monthly budget in an efficient way.
- Another major advantage of using the EMI calculator is that the process is quick and hassle-free. You can easily calculate the monthly installment of your personal loan online from the comfort of your home.
Before availing a personal loan, make sure that you compare various personal loan offers provided by different financial institutions. This will help you settle for a financial institution that provides personal loans at the most competitive personal loan interest rates. Lower the interest rate, lower will be the overall cost of borrowing and this will reduce the repayment burden of the personal loan significantly in the long run.
With leading financial institutions, you can avail an online personal loan within a short duration. All you have to do is visit the lender’s official website, fill an online application form providing your personal and employment details, specify the loan details such as loan amount and repayment tenure. Then you must upload all the required documents. After reviewing your loan application and verifying your documents, the lender will approve your loan application and the amount will be credited to your bank account. You must make a note of the loan processing charges, interest rate, prepayment charges, late fee, etc. before availing the personal loan online. Also, do not forget to read the loan agreement carefully before signing it. This will help you avoid any inconvenience in the later stage of the loan tenure. In case of any query, you must seek the help of a financial advisor to make a well-informed decision.