Why Use EMI Calculator Before Applying For A Home Loan

Posted by Shashank Bhaskar on December 11th, 2020

Property value is continuously increasing. The money you spent in the 1950s for buying a property is less than the money you pay towards repaying the home loan EMIs today. Based on the area and size of the property, your home loan EMI effectively puts a massive dent on your monthly expenses. As such, it is essential to be aware of the actual EMI payable against the loan you apply for. This is where the home loan EMI calculator comes to the picture.

EMI calculator explained

The loan EMI calculator is a unique instrument which helps you calculate the exact EMI payable against the principal amount loaned to you. The calculator uses data like principal amount, interest rates levied, and the tenure of the loan for calculating the monthly EMI payable. The EMI calculator for home loan helps you understand the total loan cost, including all charges involved such as the processing fees to disbursing them, to the actual amount paid against the principal sum.

Availability of the calculator

All Indian banks have the calculator readily available on their portals. You will find the generic EMI calculator by conducting a simple Google search on the net. You may find variations of the calculator through mobile applications, readily downloadable on the Google Play and Apple iOS. Using the calculator on the lender’s website enables you to calculate the EMI accurately since you will have the necessary information handy as minimum interest offered, maximum loan tenure, minimum as well as the full principal amount provided, etc.

Types of calculators and ways to use them

There are two kinds of home loan EMI calculator – the basic and advanced calculators.

The basic calculator is where you input values like principal amount, interest rates, and the tenure within which you would like to repay the loan. Once you have added these details, click enter for finding out the EMI payable against the value entered. If the EMI amount I out of your budget, click on reset and add new costs. This gets done by readjusting the interest rates and tenure until you arrive at a budget-friendly EMI.

The advanced EMI calculator for home loan prompts you to add further details. This includes your monthly income, loan cost such as processing fees, stamp duty, etc. homeowner expense such as property tax, home insurance, monthly maintenance costs, etc. prepayment fees, down payment, etc. It allows you to consider all the aspects of the loan and not only the principal sum, interest rates, and repayment tenure. However, these are not readily available on the lender’s portal. You need to search for them through other sources.