If you are planning to avail a personal loan, then you should be aware of the fact that using an Equated Monthly Installment Calculator has become a mandatory step these days. Around two months ago, I was looking for this type of loan in order to complete my home renovation.
This was when one of my associates told me about such loans and how it is super easy to avail them. Believe me, the days when people would travel to a bank to avail of this loan are way behind us. Nowadays, you just need a smartphone and are good to go.
What is a personal loan?
It is a type of loan that individuals can obtain from credit unions, banks, or online lenders to meet various personal financial needs. Unlike loans specifically intended for a particular purpose, such as a home or car loan, these loans are generally unsecured. This means that they do not require collateral.
With this loan, as a potential borrower, you borrow a specific amount of money and agree to repay it over a predetermined period, typically through fixed monthly instalments. The loan terms, including the rate of interest as well as repayment tenure, are based on certain factors such as your credit history, income, and overall financial situation.
What is an EMI calculator?
EMI calculator is quite a helpful tool that helps you calculate the monthly payments you would need to make on a loan. This tool is commonly used for personal, home, car, or any other type of loan where you need to make fixed monthly payments.
Here, you need to input certain information, such as the amount of the loan, the rate of interest, and the loan tenure. Once these details are entered, the calculator will provide you with the EMI amount you must pay monthly.
What is the importance of an EMI calculator in getting a personal loan?
Financial Planning
This tool helps you plan your finances effectively by providing a clear understanding of the monthly instalment you would need to pay towards the loan. It allows you to assess properly whether you can comfortably afford the EMI without straining your financial budget.
Comparison
With a Personal Loan EMI calculator, you can easily compare different loan options from various lenders. By inputting the loan details, you can swiftly compare the resulting EMIs and total interest payable.
Flexibility
The calculator enables you to experiment with different loan parameters such as the amount of the loan, rate of interest as well as the time period. You can easily adjust these variables to find an EMI that suits your requirements and financial goals.
Budgeting
By knowing the EMI amount, you can incorporate it into your monthly budget. This allows you to plan expenses and allocate funds accordingly, ensuring you meet your loan obligations on time without compromising other financial responsibilities.
Conclusion
If you plan to get this type of loan, don’t forget to use an EMI calculator. Not only will it help you plan things in the perfect manner, but it will also give you a plan that suits your budget in all ways.
