How to know the amount you?re eligible for housing loan?

Posted by Shreekant Rao on November 25th, 2016

Taking a loan is now a commonplace practice as it helps to fulfill life's important goals. Whether a loan is taken for the purchase of a home or a car, several reputed banks offer attractive loan offerings for all people. An aspect that is closely associated with any kind of loan is the Equated Monthly Installment (EMI), which denotes the monthly sum payable on the loan taken. Given below is an overview of EMI and its association with loans

The payments concerning this monthly deduction are made towards both the interest and the principal. In the early stages, the interest amount makes up a big chunk of the EMI spending. But as time progresses, the interest component sees a reduction with the principal segment witnessing an increase. There are three essential factors upon which an EMI depends:

The loan amount, which refers to the total amount, borrowed by an individual the interest rate, which is levied on the amount that is borrowed the loan repayment tenure between the lender and the borrower

What is the purpose of an online emi calculator?

To help borrowers understand the amount he needs to pay on his loan, a special type of calculator called an EMI calculator has been made available in abundance. This form of loan calculator has been particularly designed to aid in the computation of EMIs for diverse types of loans. With this piece of helpful tool, a borrower is able to get a clear picture on how to go about making his monthly repayment. It allows him to sufficiently plan beforehand so that the repayment process is smooth and convenient.

As a result, he faces lesser chances of defaulting on his payment. Above all, one must clearly understand that an Equated Monthly Installment on a loan amount does not undergo any changes; it is only the interest percentage and the principal sum, which see significant changes from time to time.

[Source: http://www.sooperarticles.com/finance-articles/emi-calculator-its-purpose-different-types-1451747.html?]