Financial planning is considered a dynamic procedure that includes careful thought, calculations, execution, and planning. With downturns and fluctuations, the umbrella of finance is constantly changing. As there must be zero constraints or restrictions on how you should use the funds, an online personal loan option offers loan proceeds at zero collateral to serve various purposes. However, just like other debt options, personal loans must be repaid-with interest.
A personal loan is a preferred loan choice due to its instant disbursal, flexible repayment tenure, suitable rate of interest rate, simple eligibility parameters and minimal documentation. However, you must just apply for it after a considerable evaluation of your financial condition. Before you accept the personal loan offer, ensure to use the personal loan calculator to compute how much the loan will cost you every month.
Ensure to use the personal loan EMI calculator of just that lender from whom you are availing a personal loan. For instance, if you have zeroed on Bajaj Finance as Bajaj Finance personal loan interest rates are the lowest as per your credit profile, then go for it. However, before placing an application, ensure to check with Bajaj Finance personal loan EMI calculator for the accurate EMI as per your repayment capacity and suitability. Note that in case the personal loan is taking a long to be processed, then you do not require visiting the bank branch physically. You can simply log into the Bajaj Finance website to check the Bajaj Personal Loan status online.
What is a personal loan calculator?
As stated earlier, personal loans may be taken up without mentioning any specific reason. This is because the availed proceeds can be used for any reason. It is a collateral or security-free loan with a short processing time, hassle-free processes and an attractive rate of interest. However, personal loans come with a defined repayment tenure during which you should repay your EMI regularly. Estimating your payout (monthly) can be intimidating. Here is where a personal loan calculator can help you.
A personal loan calculator is nothing but a specialized instrument for computing the monthly loan EMI amount that you must repay. These EMIs are computed using various important parameters, including the amount that you must borrow, applicable interest rate and loan repayment tenure. Personal loan calculators offered by various digital lenders are totally free and can be availed instantly. For this, you do not require going to any lender’s office or loan agent to know your loan cost and whether the cost fits your budget. Read on to understand how the tool may be useful for you –
How does a personal loan calculator work?
Listed here are 3 easy steps to compute your EMI through a personal loan EMI calculator.
∙ Place in your desired loan and proceed
∙ Set the repayment tenure
∙ Choose the estimated rate of interest
Once you have placed these important values, you will be provided with the EMI proceed along with a detailed monthly schedule for repayment. Now, let’s go through various reasons as to how an online personal loan EMI calculator simplifies your financial planning –
Accurate and quick results
Computing using paper and pen is time-consuming and simply prone to mistakes or errors, but an online loan EMI calculator can give accurate results. The online calculator gives accurate results because it uses the EMI formula as its algorithm and constantly produces results in a second, which is error-free. Moreover, this tool is easy to use and can be used multiple times as per your requirement at zero charges. To compute your personal loan EMI, you simply need to input the principal constituent, rate of interest and repayment tenure as per your choice in the online calculator. This helps you to be aware of the total loan cost, monthly repayment outgo, and estimated repayment tenure as per your repayment capacity before placing the application for a personal loan. Knowing these figures from before prevents you from future defaults.
Assists in determining repayment tenure and amount.
You, as a borrower, can adjust different loan values as many times as possible through the online personal loan EMI calculator. For instance, if your loan EMIs are extremely costly, then you can reduce your loan proceeds, lengthen your repayment tenure, or go for both options to make your loan affordable. Ensure to keep in mind that the higher the repayment tenure, the heavier is your overall interest constituent. While a shorter repayment tenure enhances your EMIs, you still can limit your net interest. Ensure to adjust your principal values and tenure until you find a financially feasible structure based on your potential to repay.
Automated amortization schedule
Many of the digital personal loan calculators may go a step ahead to show how your repayments will get amortized. This permits you to view how much of your principal component is paid every month. Moreover, understanding your month-on-month repayment schedule also assists you in better organizing your overall finances and determining the prudent time to make pre-closure or pre-payment of your loan in the near future. Knowing how much you will require to pay monthly in the form of EMI will endow a clearer idea about how much more you will require to save to attain your financial goal. This allows you to fix an apt budget around EMI and assure that your savings stay on the right track and your finances face no suffering.
Assist in selecting the correct lender
The personal loan EMI calculator available online takes into consideration the lender’s rate when computing the result. Even a minor change of 0.5 percent may have a considerable impact on your payments, and the EMI column in the calculator will reflect it. You can opt for the least costly personal loan by putting your loan proceeds and tenure on lower levels and inputting various rates offered to you by different lenders in the calculator. Once you have zeroed on the potential lender, look out for different repayment options available for a hassle-free and positive borrowing experience. Usually, the EMI form is the most common way of making repayments, but there are few digital lenders that allow step up Flexi EMI plan. As per this plan, you initially repay a lower personal loan EMI, and with the rise in your salary, you repay a higher personal loan EMI.