Home Loan EMI Calculator: Calculate Your Savings on Home Loan
India’s lending market saw massive growth in the demand for home loan in recent years, owning to rapid urbanisation and the increasing cost of property ownership. A growing number of first-time home owners are opting for home loans to purchase property, instead of depleting their savings for the same.
Reasonable repayment terms and borrower-friendly policies are also the reasons why an increasing number of people are opting for such credit.
For instance, nearly 88% of the market share for housing loans were availed by salaried individuals across India.
-
The home loan market share in India is anticipated to grow at a rate of 22% between 2021 and 2026.
Nonetheless, individuals must pick suitable loan EMI or loan tenure to facilitate smooth repayment. To achieve the same and to create a sound financial planning, individuals should use a home loan EMI calculator and pick a combination that works in their favour.
-
The most preferred home loan tenure ranges between 11 years and 24 years.
EMI calculators are a type of financial tool that comes in handy for estimating loan EMI and in turn, helps ascertain repayment capability.
Features and associated benefits of using EMI calculator
The government’s endeavour to provide ‘affordable housing for all’ is also estimated to push home loan demand further over the next 5 years. Nonetheless, to make the most of such credits, individuals should use an EMI calculator to plan their borrowing and repayment smoothly.
Subsequently, they should become familiar with these prominent characteristics of home loan EMI calculator and use the same to their benefit.
1. Easy to access and use
Individuals can access a house loan calculator of a trusted financial institution online at any time. The said financial tool comes with a user-friendly and intuitive interface that is easy to use and navigate. A borrower only need to enter the following details to ascertain their EMI amount.
- The loan amount he/she wants to borrow
- Preferred tenure
- Applicable loan interest rates
By following these steps below one can use an EMI calculator online easily -
Step 1 - Go to the website of a trusted financial institution.
Step 2 - Navigate to the home loan EMI calculator option.
Step 3 - Enter details like - loan amount, tenure and rate of interest.
Once these steps are completed, the outcome will get displayed instantly. It must be noted that some home loan EMI calculators may require mentioning the type of borrower they are - for instance, new borrower, existing borrower or senior citizen.
2. Accurate calculation
Financial institutions compute loan EMI with the help of a complex formula. To use the same correctly, users need to be aware of the prevailing interest rates for each type of customer and use the same accordingly.
However, the online home loan calculator comes with pre-programmedformula that eliminates the need for doing any manual calculations. Users can determine their estimated EMI with the help of a calculator and avail accurate outcomes every time.
3. Prompt results
Online EMI calculator helps to compute home loan EMI within a few seconds only. It not only eliminates the risk involved with lengthy manual calculation but also provides prompt results saving a lot of time,which makes the entire process hassle-free and convenient.
These financial tool uses this formula below to compute loan EMI -
EMI = [P x R x (1+R) ^N] / [(1+R) ^N-1]
Here,
P = Principal amount
R = Rate of interest
N = Loan tenure
Example of EMI calculation:
Suppose Sanjeev takes a loan of 
20,00,000 for 120 months and at an interest of 9.5%. As per the formula, the EMI will be -
EMI = [P x R x (1+R) ^N] / [(1+R) ^N-1]
= [20,00,000 x 9.5% x (1+9.5%) ^ 120] / [(1+9.5%) ^ 120 - 1]
= 25,880
4. Ease of making adjustments
One of the best things of using a home loan EMI calculator is that users can make multiple adjustments to their loan inputs to arrive at a favourable combination of tenure and loan amount. By using this financial tool, users can understand how to trim home loan tenure for their easy repayment.
It will enable them to make a better decision when it comes to picking a lengthy or a short tenure.
Typically, they will notice that selecting a lengthy tenure leads to low monthly instalment; whereas, a shorter term leads to a high EMI. Although, one must understand that usually longer tenure also means a higher interest burden, in general.
5. Effective comparison
The freedom to make multiple adjustments also enables users to compare different loan amounts and EMI combinations more easily. Doing so, one can easily find out which combination is more suitable for their repayment capability and aligns with their financial plan.
It is, in fact, one of the top benefits of calculating EMIs before taking a home loan.
Individuals can also use this financial tool to compare the loan provided by different leading financiers and pick the one that suits them the most. Notably, besides factoring in the home loan interest rates and other features extended by a financier, individuals must also check the additional charges levied on the loan amount.
To make the most of their loan facility, they should pick a lending institution that extends home loans at feasible terms and is transparent about the additional charges.
Also, leading financial institutions provide customers with lucrative pre-approved offers to make application process hassle-free. In most cases, such offers accompany financial products like home loans and loans against property. Check your pre-approved offer online by sharing your name and contact details.
Other than these, using a home loan calculator facilitates effective financial management. It helps them to build a robust budget and plan their repayment seamlessly.
