When opting for a Personal Loan it is important to ensure that the monthly EMI is comfortable for you to pay. If not well planned, you may be caught in a situation where you are unable to pay back the loan.
This is where a PL EMI calculator becomes essential. It helps you to determine the monthly payment, the total interest, and the total cost of the loan without having to apply for it. If you are going to apply for a Personal Loan, then it is essential to use an EMI calculator.
How does a Personal Loan (PL EMI calculator) work?
A PL EMI calculator is an online tool that helps you to determine your EMI for the loan in a short span of time. Typically, you provide three variables: the sum of the loan, the rate of interest, and the term of the loan. The calculator then gives the estimated EMI, total interest to be paid and the total amount to be repaid.
Unlike other manual calculations, this one does not involve guesswork or human error and provides error-free results.
Why should you use a PL EMI calculator before applying?
It is extremely necessary to know how you will be able to repay the loan that you are seeking. Without it, you might choose an EMI that is unaffordable or a tenure that increases the total interest amount.
When you use a PL EMI calculator, you get to know the repayment plan that you are likely to make. One can compare different loan amounts, terms, and interest rates to identify the best loan to take.
- Avoids financial strain
One of the biggest drawbacks of taking a loan without proper calculation is choosing an EMI that one cannot afford. This may lead to non-payment of bills and other penalties.
A PL EMI calculator ensures that the EMI is within your reach. It helps you to balance your loan repayments in terms of your monthly budget.
- Compares different loan options easily
The interest rates and the tenures differ from one lender to another. It can be quite cumbersome to calculate the EMI for each of the options mentioned above manually.
By entering the necessary information into an EMI calculator, the details of different loan offers can be obtained in a few minutes. This helps you in identifying the loan with the lowest EMI and the lowest total amount to be repaid.
- Saves you from paying extra interest
The longer the loan period, the higher the interest rate that will be charged on the loan that you are seeking to borrow. Some borrowers prefer long tenures, thinking that this will reduce the EMI, but in the process, they end up paying more for the interest.
A PL EMI calculator is a tool that helps you to get the right balance. You can also notice how different tenures affect your interest and choose the repayment plan that will not put a lot of strain on your finances.
Final Thoughts
It is wise to use a PL EMI calculator before applying for a Personal Loan. It helps you select your loan, decide, and avoid potential financial issues. By calculating your monthly payments in advance, you can better manage your budget and ensure that the loan is affordable and suits your financial situation.