BANGALORE: In today’s date dream has no limit and people buy whatever they want in EMIs. Equated Monthly Installment is nothing but the amount paid by borrowers each month to the lender of the loan. EMI can be calculated for a car loan, home loan, personal loan and gold loan. The principal amount borrowed and the interest are added and then divided by the number of months, an individual desires to pay the total amount. The installments thus derived are called EMIs. The calculation of EMI is based on your interest rates, loan amount and the tenure of the repayment for the entire loan.

EMI comprises of two variable components, those are principal amount and interest rate. The component of interest amount is higher in initial years and decreases over the years. EMI is calculated using the factors like interest rates, loan amount and the tenure of the repayment.

The EMI Calculator can be used for calculating the EMI of any bank be it SBI, HDFC and ICICI since only the default fields in the calculator would need to be changed.

As interest rate is not something that the borrower can decide, he can definitely increase / decrease the tenure to find a suitable EMI. The borrower can also increase the tenure to increase the loan eligibility amount. The borrower should keep in mind that any increase in tenure will result in higher interest component on same loan amount.