Home Business How Can You Easily Calculate Your Personal Loan EMI?

How Can You Easily Calculate Your Personal Loan EMI?

How Can You Easily Calculate Your Personal Loan EMI?

How do you avail a personal loan when you are in need of funds for your personal financial requirements? You approach a lender, match the lender’s eligibility criteria, make an application, submit your documents and pay the processing fee and the loan is issued. Do you calculate the EMI of the loan before you make an actual application?

Calculating the EMI of your personal loan beforehand is important. It helps you find out whether the loan that you are seeking would be affordable to repay or not. When you calculate the EMI before availing the loan you can see what the loan would cost you.

Moreover, you can also adjust your loan details, like the amount and repayment tenure, to arrive at an EMI which would be affordable. Thus, EMI calculation is essential before applying for the loan. Do you know how you can do it?

You can calculate the expected EMI of your personal loan using the following formula –

EMI of the loan = {P * R * (1+R) ^N} / {(1+R)^ (N-1)}

Where P is the amount of loan, R is the rate of interest and N is the term of repayment.

You can put in the values and calculate your personal loan EMI. Alternatively, if you do not want to go into lengthy mathematical calculations, you can also use online personal loan EMI calculators which would calculate the EMI in seconds. Interested? Let’s understand how these calculators work.

Personal loan EMI calculator

A personal loan EMI calculator is an online calculator to calculate the EMI of the loan. To use the calculator you would have to enter the following loan details –

  • The amount of loan sought
  • The repayment tenure
  • The applicable interest rate

Once these details are entered the calculator would calculate and show the EMIs instantly. You can also change the inputs to change the EMI calculated. If you want to increase the EMI, you can increase the loan amount or reduce the repayment tenure. If, on the other hand, you want to decrease the calculated EMI, you can reduce the loan amount or increase the repayment tenure. The calculator would take in the changed inputs and calculate the revised EMIs instantly.

Thus, by using the calculator you can not only check the EMIs of the loan, you can also decide on an EMI which would be the most affordable to pay. The calculator, therefore, proves quite useful.

Personal loan EMI calculators are offered by both lenders as well as online loan aggregators. Though both the calculators do the same job, calculators offered by online loan aggregators are a better bet. This is because such calculators calculate the EMIs of personal loans offered by different lenders at the same time.

By entering the loan details you can see the different EMIs of different lenders. Since the interest rate varies between lenders, you would be able to find the lender with the lowest interest rate charging the lowest EMI for the loan you seek. Thus, calculators of loan aggregators help you compare and avail the best personal loan and you should make sure to use EMI calculators to calculate the EMI of the personal loan before you avail it.

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