As financial services and products get more easily accessible with every passing day, personal loans have come to be considerably popular among professionals looking to cover their large purchases, emergency expenses, debt consolidation, and other personal financial requirements. However, while personal loans do provide quick access to funds, you must appraise quite a few factors before availing of one – including the loan tenure, your repayment capacity, and interest rates. After all, taking out a personal loan is bound to influence your lifestyle and spending habits in some way.
Instead of making do with speculations and manual calculations that more often than not prove to be incorrect, a very convenient way for you to consider your suitability to take out a personal loan before applying for one is to use a personal loan EMI calculator.
What is a Personal Loan EMI Calculator?
First things first, EMI is the acronym for Equated Monthly Installment. The Personal loan EMI consists of the repayment of the principal amount, and the interest payment on said personal loan. A personal loan EMI calculator, of course, is a tool that lets you evaluate your monthly repayable amount for your personal loan.
Checking with an EMI calculator before applying for a personal loan is a smart way to begin the process. Determining how much EMI you would be paying during your loan tenure can, in turn, help you better understand how a personal loan might affect your monthly expenses and lifestyle.
How Does the EarlySalary Personal Loan EMI Calculator Work?
To calculate the EMI you need to pay annually towards the principal payment and interest payment over the tenure of your personal loan, you have to put the following information into the EarlySalary personal loan EMI calculator:
- The loan amount: The first thing you have to enter is the principal amount that you wish to take out through your personal loan.
- The loan tenure: Next, you have to put in the duration of your loan – the period of time you’d be allowed to repay your personal loan.
- The interest rate: And finally, the calculator needs to take into account the interest rate being charged, which is a percentage of the principal amount you have to repay.
How Can Using an EMI Calculator Before Taking Out a Personal Loan Prove Beneficial for You?
Using an EMI calculator before applying for a personal loan can give you many advantages, like:
When you know your definite EMI amount, you are in a position to plan your finances throughout the tenure of your personal loan, and modify your monthly expenses accordingly.
- An EMI calculator allows you to make a well-informed decision by letting you experiment with the factors that affect your EMI.
Your loan amount, tenure, and the monthly interest rate all play major roles in increasing/decreasing your EMI. Why? Well, since your payable EMI is directly proportionate to the principal amount you have borrowed, the higher your loan amount, the higher EMI you’d have to pay. Plus, a longer loan tenure would allow you to reduce your monthly installments, as opposed to a shorter tenure that would increase your EMI. And of course, a higher interest rate means you’d pay a high EMI as well.
An EMI calculator lets you experiment with different loan amounts and loan durations so you can figure out the suitable loan amount you’d be able to take out without causing any inconvenience to your finances, and the period of time within which you can comfortably repay your loan.
- With an EMI calculator, you can make sure you have a good credit score.
If you develop an idea of your EMI amount before applying for a personal loan, you can prepare yourself to repay the borrowed amount in time. Thus you won’t be in a position to miss your EMIs, and you’d be able to avoid a poor credit score.
- Using an EMI calculator lets you save time, and the results produced by an EMI calculator are always accurate.
The personal loan EMI calculator performs complex calculations in mere moments and allows you to save valuable time that you’d otherwise have to spend manually doing some pretty strenuous calculations to determine your EMI. Plus, since there is no scope of human errors, an EMI calculator would always give you accurate results concerning your monthly installments.
In conclusion, using an EMI calculator lets you assess your eligibility to avail a personal loan and repayment capabilities, and ensures your financial wellbeing. To find out how to get a personal loan from the comfort of your home, use a personal loan EMI calculator, or know more about personal loans in general, do visit the EarlySalary website!
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