The Indian economy has witnessed a rough patch in the last two years due to the pandemic, and all the sectors suffered from massive financial losses. Moreover, now with the increased repo rate, the lending rates will be higher for any credit facility, thereby leading to an increased borrowing cost.
In this regard, since a home loan is a significant financial commitment, borrowers must consider their affordability and finances before availing of it. So, taking help of a home loan EMI calculator can be effective as borrowers can compute EMIs conveniently and plan their repayment schedule.
How to calculate EMIs with a home loan EMI calculator?
This online EMI calculator is a specially designed tool that allows borrowers to evaluate EMIs against home loans. Such effective online tools are available on most financial lenders’ websites. Nonetheless, borrowers can take a look at the simple steps below to know how to calculate EMI with this calculator:
Step 1: Firstly, input your preferred loan amount
Step 2: Enter the applicable interest rate
Step 3: Lastly, enter the repayment tenor
After inputting these loan determinants, borrowers will get the result comprising the EMI amount and overall interest outgo. Using this calculator beforehand will give a fair idea to the borrowers about how much home loan EMI they can afford.
Apart from this, if borrowers want information about 30 lakh home loan EMI, they can also use this calculator in the same way and get accurate results within a few seconds.
Factors impacting home loan EMIs
A borrower’s home loan EMI relies on multiple factors. Once a borrower is assured of home loan eligibility, they can arrange funds and fulfil their dream of purchasing a house. However, keeping the below-listed pointers in mind that significantly affect the EMIs will allow borrowers to ensure hassle-free repayment and an improved borrowing experience:
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Change in interest rate
Any changes in the interest rate during the repayment tenor can considerably impact home loan EMIs. This is mostly applied to a floating interest rate that keeps changing per market trends. These fluctuations can either have both positive and negative impacts on home loan EMIs. Whenever there is a change of rates announced by RBI, it reflects on the EMIs.
For instance, if a borrower is paying a certain 50 lakh home loan EMI amount, it can change depending on the fluctuating market rates. So, one must carefully choose the interest rate when availing of a housing loan.
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Loan repayment tenor
It is another crucial factor that can significantly impact home loan EMIs. Basically, if one chooses an extended tenor, the EMIs will be lower and vice versa. However, one must not overlook that a longer tenor comes with a higher interest payment. This means that even if the EMIs are lower for choosing a higher tenor, one will end up paying substantial interest in the long run.
In this regard, borrowers can use a home loan EMI calculator and use different combinations of loan amount and tenor until reaching an EMI amount that suits their affordability and financial requirements.
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Transferring loan to another lender
Borrowers may have taken a housing loan from the most suitable lender, but it is difficult to keep tabs on interest rates and offers extended by other lenders. To avail of a favorable interest rate, borrowers can change their lender by choosing a home loan balance transfer facility. However, before choosing this facility, one must ensure that they can considerably save on their EMIs on this. Apart from these, one must also consider the associated cost involved in transferring the loan.
Apart from these factors, borrowers can also make prepayments when having substantial funds as the outstanding amount decreases, thereby leading to EMI reduction. On the other hand, to ensure hassle-free EMI payment throughout the tenor, prospective borrowers can approach leading financiers where they can avail of a substantial loan amount at affordable rates as well.
Moreover, borrowers can also get the benefit of pre-approved offers on a range of financial products such as a loan against property, home loan, etc. These offers significantly reduce the hassle of extensive documentation and save time. Therefore, existing borrowers can check their pre-approved offers by mentioning their names and contact details.
To summaries, by understanding the guide mentioned above and knowing the use of home loan EMI calculators, borrowers can determine the overall EMIs and interest outgo. However, it is still wise to compare different loan offers available in the market before making a final decision.
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