We often take a loan to fulfill our desires. You can take a loan to buy your dream car, host your son’s/ daughter’s wedding, pay college fees, expand your business, or build a house. Thus, it is important to repay the loan on time. Now, let us discuss one of the most popular loan repayment processes, known as EMI.
EMI stands for Equated Monthly Installment. It is the amount that you need to pay every month to your loan issuing organisation until the entire amount gets paid. The interest amount is also included in the EMI. An EMI has two components, the interest and the principal. During the initial months, you need to pay more interest than the principal. The EMI amount will be the same. But the proportion between interest and principal will change in upcoming months
Hence, it is crucial to calculate the EMI amount before applying for a loan. Also, you can plan the repayment process based on the value of the EMI amount. This article will discuss some crucial aspects of EMI and the calculation procedure.
You can repay using EMI for many reasons. It can be a Bike Loan EMI, Car Loan EMI, Business Loan EMI, Gold Loan EMI, etc. Hence, it is crucial to consider the different types of EMI. There are two types of EMI - Advance EMI or Arrears EMI. You can take either of them.
Arrears EMI: We also call it the Standard EMI. Suppose, you want to take a loan for something, but don’t have a sufficient amount for down payment. Here, you can utilise this EMI option. You have to pay the EMI at the end of every month. You need to continue it till the specified tenure mentioned during the loan sanction. The financial institutions will disburse the whole principal amount by subtracting the processing fee to the bank account of the borrower. It will not deduct any amount for an EMI advance payment.
Advance EMI: Most of the banks in India offer this EMI Scheme. Here, you have to complete the first payment to the bank in advance. The financial institutions will disburse the principal amount by subtracting the processing fee including the first EMI. The first payment only has a principal amount. Hence, it does not contain any interest in it. So, this scheme can reduce the principal loan for the remaining EMIs.
You can take EMI on your debit card. You have to know certain procedures to get the monthly installment for loan facility. Let us discuss those:
You can get the EMI option from banks and NBFCs. You have to visit the office and fill the EMI application. You can select the loan amount and tenure. The officials will mention the interest rate for the loan. You can submit proper documents and verify them to get the monthly installment for loan.
You need to calculate the monthly installment amount for the following reasons:
Calculation of the EMI will help you with financial planning.
You will understand what to pay and for how long. Hence, it will help you to identify the perfect tenure for a smooth repayment.
In certain situations, EMI calculation can also help you to achieve your desired loan at the lowest interest rate. You can also get Zero Cost EMI.
The EMI amount depends on the principal amount, tenure, and interest rate for the loan. These three parameters will help us to calculate the value of EMI. Thus, you need to keep knowledge of these parameters. There are multiple ways to calculate the EMI. You can use Mathematical formulas, spreadsheet apps, and online EMI calculators for calculating the EMI.
You can use the following mathematical formula to calculate the EMI:
A= P * _________
Here, A stands for the EMI amount.
P is the principal loan value. It is the amount that the borrower takes from a financial company, bank, or lender.
r stands for the interest rate for the loan. The loan sanctioning organisation charges the interest on the principal amount for lending.
Here, n is the tenure. It is the total time given by your lender for repayment. This tenure can depend on the principal amount, type of loan, and the loan sanctioning organisation.
Let’s assume, Mr. Rahul needs a loan of ₹2,00,000 with 10% interest. If he wants to pay EMI for 24 months, he has to pay ₹9,229/ month as an EMI.
This formula is used in spreadsheet apps like excel and online calculators to calculate the EMI. Banks and other financial institutions often provide EMI Calculators to help their customers.
Shriram City EMI Calculator:
You can take the help of an easy-to-use EMI Calculator is provided by Shriram City. You can easily check the EMI of your loan from our website. You can click this to calculate your loan EMI. Our EMI calculator will help you to calculate the total payable interest, the entire payment amount, and the value of EMI you need to pay per month. You need to provide the loan amount, interest rate for the loan, and tenure for EMI calculation. Also, you can calculate bike loan EMI, business loan EMI and gold loan EMI from the website of Shriram City.
This easy-to-access online calculator can help you to achieve your financial goals. Also, you do not have to calculate your EMI manually. It is very easy and can save your precious time of manual calculation. You can get instant results from the EMI Calculation tool of Shriram City.
If you are satisfied with the EMI, you can directly apply for the loan. Just click the apply now button to get started. You can fill-up the form and submit it with the proper documents. Shriram City can provide you a loan with minimum documentation. Your loan will be instantly processed and you can utilise our flexible repayment scheduling scheme.
Fulfill your desires by taking an instant loan from Shriram City. Our EMI calculator will help you to decide the proper tenure for repayment. Take a loan and accomplish your financial needs. Shriram City provides lucrative loan schemes for its clients. Within 5 minutes, you can apply for a loan. It will be hassle-free and easy for you to get your loan. You can solve your financial emergencies with our attractive loan options. So, do not wait for the money to fulfill your dreams and desires. Go through our website, calculate your EMI and apply to get started.