In the journey of buying a home, each step is woven with threads of anticipation, excitement, and a series of decisions. It also involves applying for a home loan, choosing the loan tenure, and much more. During the process, one aspect that can’t go unnoticed is planning and calculating your Equated Monthly Instalments (EMIs).
Before understanding the financial implications, you must know the potential of using a housing loan EMI calculator for proper loan management.
This blog is a step-by-step guide to understanding the use of a housing loan EMI calculator. It will also discuss the benefits of using an EMI calculator.
What is a Housing Loan EMI Calculator?
A housing loan EMI calculator is an online tool to help you calculate your Equated Monthly Installment (EMI) for a home loan. An EMI is the fixed amount you pay each month towards repaying your home loan. It entails both the principal amount and interest. This calculator helps you plan your finances better, determine your budget, and make informed decisions about your home loan.
Ways to Use a Housing Loan EMI Calculator Effectively
Here is a simple guide to using a housing loan EMI calculator and making computations hassle-free:
Step 1: Gather the Necessary Details
Before you start using the calculator, it is important to collect the necessary information. Please see a short list below:
- Loan Amount
It is the total amount you intend to borrow from your chosen lender for buying your home. Make sure you have a clear idea of the loan amount you require.
- Loan Tenure
The loan tenure or duration is the period over which you plan to repay the loan. It’s usually measured in years. You must decide on a tenure that suits your financial capabilities.
- Interest Rate
Check the prevailing interest rate offered by the lenders. This rate can change depending on the lender, the type of loan, and your creditworthiness.
Step 2: Visit the Lender’s Website
Most banks or financial institutions like Tata Capital have user-friendly websites with a housing loan EMI Calculator readily available. It is best to visit the official website of your chosen lender and look for the EMI calculator tool.
Step 3: Input the Details
Once you find the housing loan EMI calculator, follow these steps:
- Loan Amount: Enter the loan amount you need in the designated field. Ensure it matches the amount you’ve decided upon.
- Loan Tenure: Enter the loan tenure in years. It should align with your repayment plan.
- Interest Rate: Input the applicable interest rate for your home loan.
Step 4: Calculate EMI
After filling in the required details, the housing loan EMI calculator processes the information and displays the EMI amount on the screen. It is the amount you will have to pay every month to your lender. It further also displays the exact repayment schedule with a breakup of the principal and interest repayment for each of the EMIs.
Step 5: Analyse Your Budget
Now that you have the EMI amount, it’s time to assess your budget. Ensure that the EMI is within your financial comfort zone. It’s essential to leave room for your other monthly expenses, emergencies, and savings. If the EMI seems too high, you might consider extending the loan tenure to lower the monthly burden, though this will increase the overall interest paid.
Step 6: Compare Different Scenarios
A great advantage of the housing loan EMI calculator is its flexibility. You can tweak the loan amount, tenure, and interest rate to see how different scenarios affect your EMI. This empowers you to make informed decisions about the loan that best suits your financial goals.
Once you are satisfied with the EMI amount and the overall loan terms, it’s time to apply for your home loan. You should contact your lender or go through an online process to initiate the loan application process. When you have a clear understanding of your EMI, it makes your application process smoother and more efficient.
Housing Loan EMI Calculator: Take the First Step
A housing loan EMI calculator is an essential tool for anyone considering a home loan. It helps you in your crucial decision making of buying a home. This calculator gives you a clear picture of your finances in the coming years. Remember, the key to successful and effective financial planning is knowledge, and this calculator equips you with just that.
For accurate and effective budget planning, it is best that you use the calculator provided by your chosen lender. If you apply for a home loan from Tata Capital, then you can use their online housing loan EMI calculator to get accurate figures. Moreover, you can also go through their terms and conditions, interest rate offerings, and much more for proper loan management.
Discover your home-buying potential and apply for a loan today!