Home Loan EMI Calculator
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(Loan EMI)
0
(Total Interest Payable)
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Total Payment (Principal + Interest)
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(Your EMI Amount)
Due to the upsurging price of real estate in India, purchasing a house can be challenging without an external source of finance. An increasing number of prospective home buyers opt for this type of credit to fund their house purchases. Therefore, to solve the complexities of all calculations Home Loan EMI Calculator arrives right at the ease of customers for easy home purchasing.
A home loan calculator can be used by a customer to compare the loan offers from different banks. And thus useful in planning the cash flows in advance so that home loan payments can be made with ease.
How can a home loan EMI calculator help someone?
Equated Monthly Installment or EMI is a fixed amount that a borrower needs to pay back to the lender every month till their tenure ends.
Calculating the EMI and its components can be a cumbersome exercise for first-time financers. Therefore, home loan calculators play a significant role in this critical situation. It has several benefits as mentioned below:
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Simple, Convenient, Instant, and Accurate:
Manual calculations are prone to errors. Hence a home loan EMI calculator solves this problem because it gives an accurate result.
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Faster Calculations:
It can take up to hours if one sits with pen and paper to do any type of calculations regarding any loan. However, with an EMI online calculator, everything is possible with a single mouse click. With this EMI online calculator, one doesn’t have to check and double-check calculations all the time.
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Financial Planning:
The EMI loan calculator can help protect one from any financial troubles in the future. Prior knowledge of home loans can help plan any budget more efficiently and get an amount that fits one’s bill.
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Beneficial for loan management:
Sometimes customers have additional funds to prepay with the EMI payments. In case a customer wants to review financial data and find out how the prepayment can help repay the loan before the deadline, the home loan EMI calculator plays a great role in this.
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Comparing Loan Offers:
Customers can use a loan calculator to compare loan offers from different banks. The results display the total cost of borrowing together with each EMI. This will in turn help narrow down the best options for clients and choose a loan that fits best as per their requirements.
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No personal details needed:
Home loan EMI calculators are completely safe to use as one doesn’t need to reveal one’s identity or worry about any security issues. One is ready to embark their journey to a new home by overcoming the obstacle of personal detail.
All the complex calculations for taking up a home loan is carried online using a specific home loan EMI calculator formula, which is:
E = [P x R x (1+R) ^N] / [(1+R) ^N-1]
Where
E stands for EMI amount
P stands for Principal amount
R stands for Rate of interest
In addition to the interest rate over principal amount, the banks also charge a home loan processing fee which is added to the overall cost of the loan. One can negotiate the home loan processing charge with the bank to get a better home loan.
What are the eligibility criteria for a Home Loan?
There are some common parameters that are set across all banks and Non-Banking Financial Companies ( NBFCs) which are applicable for all the customers. Let’s have a glance at it.
| Age | 18- 70 years |
| Income | Rs25,000 |
| Credit score | Above 750 |
| Employment Status | Salaried or Non-salaried |
| Work Experience | 2 years |
| Loan Amount | Decided by the lender |
| Residence Type | Permanent resident or Non-resident Indian(NRI) |
| LTV Ratio | Up to 90% |
| Property Type | Completed/Under construction project, Land/Plot |
Note: The differences in eligibility criteria depend on the bank/lender. Home loan approval is based on borrowers' income, credit profile, and existing relationship with the bank.
FAQs (Frequently Asked Questions)
Q1. What is the minimum tenure of home loan a lender can offer?
Ans: Home loans are long-term borrowing finance with a minimum tenure of 5 years and a maximum tenure of 30 years. However, the tenure offered depends on the loan amount that is sanctioned to the customer/borrower by the lender along with other factors.
Q2. Can anyone apply for a joint loan with any friend?
Ans: Till now there’s no such information on this regarding friends but yes, a lender can apply for a joint home loan if the application is co-signed by one or more family members.
Q3. What is the maximum number of joint borrowers for a home loan?
Ans: The maximum number of joint borrowers in the case of a home loan is fixed at 6. Any family members such as parents, siblings and spouse can be co-borrowers for a home loan in India. Moreover, a co-borrower who has a robust credit history and good credit score is given more preference as compared to the one with a low credit score.
Q4. What is a floating-rate home loan?
Ans: If the interest rate on the loan varies periodically over the loan tenure, then it is called a floating-rate home loan. Lenders have their own fixed base rate which determines the rate of interest charged on a home loan. The base rates of banks keep on revising from time to time as per RBI directives as well as other factors, which leads to an increase or decrease in the EMI amount payable.
Q5. What is a fixed-rate home loan?
Ans: Fixed-rate home loans are offered at a predetermined interest rate during the loan period, and these remain unchanged during the loan period irrespective of market conditions. This can be a huge benefit when the market becomes volatile and starts affecting interest rates. For example, on the increase of interest rates on loans as per RBI, people having fixed-rate home loans will not be affected by any increase or decrease in the market interest rates and the EMI amount will remain unchanged. There is less popularity of this type of home loan these days.
Q6. How is the MCLR method going to affect any current home loan?
Ans: As per recently updated RBI rules, banks are required to use the MCLR (Marginal cost of lending rate) method to determine the interest rate on home loans. Currently, the banks are required to change the interest rate either yearly or every six months in the case of floating-rate home loans. You can get in touch with your bank to get information regarding the conversion of your fixed-rate home loan to the new MCLR-based floating interest rate in case one has a fixed-rate home loan. There has been a significant reduction in applicable home loan interest rates with the introduction of the new MCLR regime.