Finances can be messy, especially if you are the one who is making the payments. One of the biggest decisions you come across when applying for a loan is the rate of interest, the tenure of the loan and the resulting Equated Monthly Instalments (EMIs) that you want. For shorter tenure, the EMIs become bigger and vice versa. There are a lot of permutations and combinations that you need to consider before you settle on the final terms of your loan. You need not sit with a calculator, pen and paper; all you need to do is access any of the online EMI calculators that give you the approximate EMI and arrive at the one that fits your needs the best. Listed below are the reasons why you need to use such a calculator to make an informed decision:
- Ease of use
It’s a simple interface as you need to work only with three filters. Enter your loan amount, the tenure and the rate of interest to figure out your EMI. With a few clicks and drags of your mouse, you will see the different EMI numbers. Using a loan calculator also saves you the effort that you would otherwise need if you calculate the amount on a manual basis.
- Accuracy of amount
There is no chance of miscalculation when you use an EMI calculator. There is no scope for entering the wrong rate of interest, loan amount or tenure as the filter is already adjusting the numbers with a simple drag function.
- Quick calculations
Even a 15-minute lunch break is enough for you to try the various combinations for different EMIs. You don’t have to schedule time out for this task. Within a few minutes, you will know just the right rate of interest, loan tenure for your chosen loan amount that will help you pay your EMIs comfortably.
- Pictorial representation of information
We understand better with pictures, don’t we? Most online EMI calculators provide you with a table of comparison with the different combinations of the three variables so that you can have all the information in one place. It also lets you compare them side-by-side quickly without the hassle of a pen or a pencil.
- Amortization graph
Amortization graph or table is another feature provided by the EMI calculator. The graph shows you an overview of how the loan will progress over time; how much of the principal have you already paid, what is the interest amount that you have paid, etc.
Reduce the hassle of calculating your EMIs and make the best use of the calculator. Consult with your family and the bank, too, to ensure that all the stakeholders are satisfied with the terms of the loan.
Now that you know what your ideal EMI amount is, go ahead and sign the dotted line to finalise your loan.