Repaying the home loan requires proper financial planning and commitment to avoid non-payment of the EMIs. Read on to know how you can use the EMI calculator to plan your finances better and manage the repayment efficiently.
Ask any financial advisor and they would all say that repaying the home loan requires careful financial planning. This is vital so that you can repay the amount on time without default throughout the loan tenure without compromising on your usual household expenses.
The EMI you repay depends on a variety of factors, including the interest rate charged by the lender, the loan duration, and the amount you borrow. And, today, planning the home loan EMI is easier than ever before; you can use the home loan EMI calculator and compute the exact amount payable beforehand so that you can be better prepared for the repayment.
Before you get to know about how using EMI calculators can benefit your financial planning, first let us understand what a home loan EMI calculator is.
What is a home loan EMI calculator?
A home loan EMI calculator in an online tool that allows you to compute the exact home loan EMI you must repay. The tool is easy to use and it gives you the results based on the inputs you provide; you must only enter the amount borrowed, the tenure and the interest rate. Once you enter the details, the calculator gives you the precise figure.
Today, almost all the lenders have this tool on their website and make it easier for the customer to plan their finances. The best thing about using this calculator is that it needs no technical expertise or experience; anyone can use it.
How does a home loan calculator help you plan your finances better?
One of the significant benefits of using a home loan calculator for financial planning is that it helps you choose the best loan offer and the right lender. For example, if you compare the loan offers from 4-5 different financial institutions who approve your application, you can use the calculator to know the exact EMI you must pay based on their offer. And, once you know the exact EMI payable, you can make an informed choice on the lender.
When you know the exact EMI amount payable to the lender in advance, you can plan your monthly budget accordingly and make sufficient arrangements to be able to repay the same. Assume a situation where you are not sure of the EMI before, and when your repayment period starts if you find the amount is too high, you may have financial hassles. You can easily avoid such unwanted and unpleasant situations by using the home loan EMI calculator.
One of the critical factors about availing a home loan is to decide the exact amount you want to borrow. You can determine this based on the property value. But, you must be aware of your financial status and decide if you have the capacity to repay the same. Using the loan EMI calculator can immensely help you in this regard. You can decide the loan amount based on your affordability.
Another significant way in which using the home loan EMI calculator can benefit is that it helps you choose the right tenure. The tenure is essentially the repayment period that you have for repaying the full amount. The loan duration has a direct impact on the EMI; the longer the duration, the lower the EMI and vice-versa. So, based on your calculation, you can choose the right tenure so that the EMI is affordable.