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How Can a Home Loan EMI Calculator help you Plan Finance Better?

The home loan EMI calculator is a free online tool that helps to compute the EMI amount. Using this EMI calculator will not only help you to know the EMI amount, but also the total interest payable and total payable loan amount. 

Hence, financial experts and lenders always advise using this calculator before availing a home loan. This will, in turn, help you plan your finance better. 

Reasons to use a Home Loan EMI Calculator for Better Financial Planning

1. Knowledge of EMI amount

Before applying for a home loan, you should use a home loan EMI calculator to know your EMI amount. If you know the amount beforehand, this will help to plan way ahead, hence will help you adjust your finances. 

2. Knowing the total interest payable

This is an important factor to consider before availing a home loan. Knowing the total interest amount will help one review his/her expenditures based on upcoming interest payable. 

3. Deciding loan amount

In most cases, borrowers often decide the home loan amount beforehand. Individuals can also opt for a suitable loan amount after knowing the EMI amount by using the calculator. 

4. Choosing right tenor

When planning for a Home Renovation , individuals can check the tenor and interest incurred in an online home loan calculator. Selecting a preferable tenor will help one calculate his/her finances better.  In addition, these decisions will help individuals to calculate their future expenditures.  This tenor is also variable with the EMI, so if you are opting for a higher tenor, it will automatically reduce your EMI. Also, applicants must know ways to reduce home loan tenor and EMI to save the most.

Steps to using a home loan EMI calculator

Step 1: Enter the loan amount.

Step 2: Select a preferable tenor. 

Step 3: Select a rate of Interest. 

Step 4: Lastly, the calculator will give the EMI amount, along with principal interest payable and total amount payable. 

Besides using the online home loan calculator, individuals must know certain factors that affect the EMI amount-

1. Loan amount

Although a home loan amount is already pre-decided by a prospective borrower, if flexible, it can be altered. If you are comfortable with a higher EMI amount, enter the loan amount in the calculator to see if you are comfortable with the EMI amount. 

2. Tenor

A longer tenor will yield a lower EMI for all the applicants. However, if you are comfortable paying a higher EMI amount, you can opt for a shorter tenor for your home loan. This will also help you repay your home loan faster. 

3. Rate of interest

The rate of interest is one of the main factors that alter your EMI amount. A higher rate of Interest will result in a higher EMI amount, thereby increasing the total borrowing cost.

Additionally, if you are opting for a home loan, follow these steps to easily get a home loan in India. In India, selected HFCs extend pre-approved loan offers to expedite your home loan application. These offers are available on selected financial products like a home loan, loan against property and others. You can check your pre-approved offer online by just entering your personal details, like name and contact number. 

Hence, to plan finance better, using a home loan EMI calculator beforehand is always recommended. This will give a better idea of an applicant’s financial liabilities.

A home loan comes with a longer tenor, and that’s why the home loan interest rate could be more if you go for a longer tenor. 

But, it is still possible to avail of the lowest home loan interest rate following a few tips. Read on!

Easy ways to get lowest home loan interest rate

  • Maintain a robust CIBIL score

A home loan is secured, but that does not underestimate the importance of a good credit score. The higher is your CIBIL score; the brighter is your chance to get the loan approval faster and at a lower rate. It denotes to the lender that you have paid your EMIs on time. Hence, lenders reward you with the lowest home loan interest rate. A CIBIL score of 750 or more is what lenders consider the best. 

  • Put down a higher down payment amount 

The higher is your down payment amount; the lower is your total borrow able as well as interest amount. Hence, you should ensure to pay at least 15-20% as a down payment. This way, you will be able to pay lower EMIs and pay less interest charges. 

  • Shop around 

One of the best ways to opt for the lowest home loan interest rate is by comparing all offers of lenders. You can do that on a third party platform and pick one that matches your needs and repayment capacity the best. 

Considering these tips can surely help you manage your home loan easily and pay reduced or lowest home loan interest rate charges.

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