Whether you’re making a major purchase, need money for unforeseen expenses, consolidate debt, or for any other purpose, loans can help you arrange the funds. However, it is crucial to map out your loan repayment strategy for a smooth borrowing journey.
This includes choosing a comfortable loan tenure, deciding the exact loan amount after assessing your requirements, comparing lenders’ interest rates and more. Here, a loan EMI calculator can simplify planning and help you find cost-efficient terms.
Read on to know how a loan calculator works, how to use it effectively, and more.
How Does an EMI Calculator Work?
A loan EMI calculator is a straightforward tool that requires minimum input to calculate your EMIs. It eliminates the need for manual calculations, and you need only enter the values for the:
- Desired loan amount
- Chosen tenure
- Estimated interest rate
Clicking on the calculate button will calculate the total interest payable, the EMIs, and the total amount payable. By changing the initial parameters entered, the estimated values will also change. Do note that this tool is completely digital and is easily accessible online.
Effective Ways to Use Loan EMI Calculator
Now that you know how a loan calculator works, here are the different ways you can use it when planning your loan.
Evaluate Affordability
Entering the values in the calculator will give you a repayment and the interest amount, which is your estimated cost of borrowing. You can experiment with the entered loan terms to decide if you can afford a loan. By trying different combinations, it is easy to gauge whether or not you can afford the loan.
Compare Offers
Another effective way to use this tool is by comparing multiple lenders’ interest rates. This is important as this loan term influences your repayment amount heavily.
Here is how the total loan amount varies with different interest rates for a ₹30,000 personal loan for 12 months.
| Interest Rates (per annum) | Monthly EMI | Total Amount Payable[EW1] |
| 10.49% | ₹2,644 | ₹31,732 |
| 10.99% | ₹2,651 | ₹31,816 |
| 11.99% | ₹2,665 | ₹31,984 |
| 12.99% | ₹2,679 | ₹32,153 |
| 13.99% | ₹2,693 | ₹32,322 |
Disclaimer: The rates and other details mentioned are for illustrative purposes. Actual values may vary.
Plan for Complete Repayment
Generally, borrowers use a loan calculator app to decide on an affordable EMI amount within their monthly budget. This is one way to ensure stress-free repayment without straining your budget. It is important that you carry out this step before you apply so that you can avail a loan that does not hamper your financial well-being.
Find the Ideal Repayment Tenure
A loan calculator app can help you find a tenure that reduces your monthly financial burden. This is because the EMI and tenure have an inverse relationship. So, if you increase the tenure, your monthly instalment will go down.
To better understand, here is how your repayment terms for a ₹30,000 personal loan change with it if the interest rate is constant at 12.99% annually.
| Tenure | Monthly EMI | Total Amount Payable[EW2] |
| 6 months | ₹5,191 | ₹31,147 |
| 12 months | ₹2,679 | ₹32,153 |
| 18 months | ₹1,843 | ₹33,179 |
| 24 months | ₹1,426 | ₹34,227 |
| 30 months | ₹1,177 | ₹35,295 |
Disclaimer: The rates and other details mentioned are for illustrative purposes. Actual values may vary.
Time Pre-Closure Payments
The amortisation schedule generated by tools such as the Bajaj Markets: EMI Calculator App allows you to identify the best times to prepay your loan and reduce the interest you pay. As such, you can set a savings goal and repay your loan before the decided tenure.
Steps-By-Step Guide on How to Use Bajaj Markets: EMI Calculator App
Follow these steps to use the Bajaj Markets: EMI Calculator App and find the best loan terms for you.
- Step 1: Download and launch the Bajaj Markets: EMI Calculator App
- Step 2: Log in on the app using your mobile number and OTP
- Step 3: Select your loan type from the options: Personal Loan, Business Loan, Home Loan, etc.
- Step 4: Enter your loan terms, such as amount, tenure and interest rate, by manually entering the number or using the slider
- Step 5: Analyse the results and tweak the parameters to find suitable terms
You can easily decide on comfortable terms for any of your loans using these steps, which will help you pay without stress. In addition to the loan EMI calculator, the Bajaj Markets: EMI Calculator App includes other calculators such as a car insurance calculator, health insurance premium calculator, FD calculator, income tax calculator, and more.
Using these you can easily avoid manual calculations for any of your financial decisions. It also helps you get accurate results and saves time on complex calculations. Download the Bajaj Markets: EMI Calculator App for a one-stop solution for your financial planning.
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