Personal loans are one of the most preferred forms of credit among borrowers. This is because, unlike a home loan or an education loan, a personal loan does not limit the borrower to a certain kind of expense. With a personal loan, you can spend the loan amount to clear any personal expense of your choice. Now, while a personal loan can be beneficial for someone in need of funds, it is essential first to ensure that the loan is affordable. This is to avoid any unnecessary financial problems while clearing the loan.
It is advisable to use a personal loan EMI calculator to determine whether a personal loan is affordable. This calculator is an online tool that anyone can use to find out the monthly instalments of a loan. It is straightforward to use; all you must do is provide this calculator with details of three components, which are as follows:
1. Personal loan amount
This is the loan amount that you are applying for. This amount could depend on the situation you need the funds for. For instance, you might use a loan to clear medical bills, academic fees, consolidate debt, etc. Renowned lenders such as IDFC FIRST Bank offer personal loans of up to ₹1 crore.
2.Interest rate of the loan
Lenders levy a certain interest rate on the personal loan that they offer. Many borrowers look for low-interest personal loans as the interest rate can significantly impact the loan’s monthly instalments. Consider various loan plans to understand which lender offers the best personal loan rate.
3. Tenure in which the loan is to be repaid
Most financial institutions offering personal loans give borrowers a tenure of 60 months (five years) for repaying their loans. While some borrowers choose a short repayment tenure to save on the total interest payments towards the loan, some prefer going for the longest tenure to keep EMI payments affordable. More importantly, you should choose a repayment tenure suitable for your budget. This ensures that the loan’s monthly instalments can be paid off comfortably without difficulties.
Once you have provided the personal loan EMI calculator with these details, it will display the loan’s EMI results. The best part about using this personal loan calculator is that you can keep changing the values in three fields to arrive at a suitable EMI value. This way, you can effectively find personal loan banks that offer convenient and affordable deals.
A personal loan calculator is an online tool on most lenders’ websites. Anyone can use this tool anytime they want for free. This means you do not even have to step out of the house to find out about a particular loan’s EMI payments! So, it is better to use this calculator beforehand and avoid any unnecessary loan repayment problems.