Personal Loan Calculator: Know How To Check Your Loan EMI Is Calculated Correctly

Rising financial needs and economic downturns have impelled the demand for unsecured loans. However, low disposable income and inflation remained some key reasons for difficulty in keeping up with hefty EMI charges. 

  • According to reports collected from the National Automated Clearing House (NACH), 38.9% of auto-debit transactions failed in FY21. 

This data highlights the importance of calculating EMIs correctly beforehand. Each potential borrower must evaluate how much they will be able to afford using a personal loan EMI calculator. This financial tool allows them to check their loan EMIs and compare different repayment schedules before choosing one, thus meeting their repayment capacity without hassle. 

Steps to check your EMI using an interest calculator 

Due to the multi-purpose nature of personal loans, borrowers are often enticed to avail of high-value amounts without thinking about the consequences. Since your EMI outgo accounts for a major portion of your monthly expenditure, it is essential to choose both the loan tenor and amount wisely to avoid repayment failure. 

There are different ways you can calculate your personal loan EMIs, for instance, using the Excel sheet or simply with the EMI formula. However, the chances of errors are relatively higher when you use any of these methods.

Therefore, to expedite the process of comparing different combinations of loan amount and tenor and ensure accuracy, you can rather make use of a personal loan calculator. Here are the steps to follow while using this financial tool:

Step 1: Visit the official website of your preferred lender and use the personal loan calculator available. 

Step 2: Start with selecting the loan amount using the sliders. Enter the repayment tenor (in months). 

Step 3: You need to select the interest rate in the next step. 

Step 4: After providing all these inputs, the personal loan EMI calculator will be showing you the exact EMI amount, including the total interest and the overall payable amount. 

Since the rate of interest offered by financial institutions varies from one to another, make sure to compare different lenders to make both your interest rates and EMIs affordable. Apart from interest rates, look for other benefits to optimize the borrowing experience.

For instance, financial institutions like Bajaj Finserv bring pre-approved offers, which simplify the loan application process. These offers are available on multiple financial products, such as personal loans, business loans, and credit cards. Check your approved offer by submitting your name and contact details. 

Aspects to consider before applying for personal loans

Before you go ahead and search ‘how to apply for a personal loan’, check these following aspects to lower your total cost of borrowing.

Credit score: Most of the collateral-free loans come with certain eligibility parameters and having a high CIBIL score is considered as one of the mandatory requirements. Make sure all your previous loans are repaid, and you maintain a credit score of at least 750 to be eligible for the best personal loans. Even though getting a personal loan with a poor credit score is not impossible, it comes with fewer benefits and a higher rate of interest. 

Eligibility: Apart from the CIBIL score, financial institutions put forth some other eligibility parameters, including employment status, monthly income and applicant’s age. Meet all these criteria to qualify for a high loan amount and get a reasonable interest rate. Just like the personal loan EMI calculator, you will also find an eligibility calculator where you can gauge the amount you can borrow based on your eligibility compliance. 

Being aware of these aspects not only helps to get prompt approval but also allows you to work on the factors that might affect your personal loan EMIs. Therefore, keep the above factors in mind before submitting your loan application to make the most of its benefits.

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