Applying for a personal loan? Use a free online EMI calculator first

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Applying for a personal loan? Use a free online EMI calculator first
Applying for a personal loan? Use a free online EMI calculator first

New Delhi : With no restrictions on how you use the money, a personal loan is a very convenient way to manage urgent expenses, such as emergency medical bills, consolidating debt or even paying for home repairs. However, due to its collateral-free nature, a personal loan attracts higher rates of interest compared to secured loans. So, borrow an amount that you can easily repay without constraining your finances.

To ensure that you make a financially sound decision, you need to know your EMI outgo beforehand. This means considering several factors, such as repayment tenor, personal loan rate of interest and total loan amount. You can easily calculate your monthly EMI using a personal loan calculator. The use of a personal loan calculator assures accurate results, helping your plan your outgo during repayment with ease. 

Here’s more on how a personal loan calculator helps and how to calculate personal loan EMI using it before applying you apply.

What is a personal loan calculator?

A personal loan calculator helps you calculate your EMI quickly. While you can always calculate your EMI manually, the use of a personal loan calculator guarantees instant and correct results. Moreover, it helps you eliminate all margins of errors and helps you change the parameters and study the results as many times as you need.

This handy online tool is easy to use as all you need to do is enter the total loan amount you’d like to borrow, the rate of interest, and the repayment tenor of your choice. You can keep changing these parameters until you arrive at an EMI amount that you are comfortable paying. A personal loan calculator helps you plan your finances for the duration of the repayment tenor and compare loan deals from various lenders to choose the best one as per your needs. 

What is the mathematical formula used by a personal loan calculator?

Here’s a formula that is most commonly used by digital personal loan calculators:

E = P * r * (1+r) ^n / ((1+r) ^n-1) 

Here E is the monthly payment or EMI, P is the loan amount or principal, r is the monthly rate of interest, and n is the tenor or repayment duration. To better understand how the formula helps you calculate EMI, here is an example:

Consider that you apply for an instant personal loan of Rs. 10 lakh at a 15% interest rate with a repayment tenor of 60 months. The annual rate of interest is divided into monthly interest, that is, 15/12 = 1.250%. As per the formula, P = 10 lakh, R = 1.250% and n = 60 months

Therefore, your personal loan EMI is Rs. 23,790. 

How to calculate personal loan EMI using the online calculator?

Calculating your EMI manually can be tedious and invite slip-ups. This can disrupt your financial planning, and in extreme cases, falsely convince you to apply for a higher loan amount. However, using the Bajaj Finserv Personal Loan EMI Calculator can help eliminate mistakes and save time. Moreover, it is easy to use, it’s free, and all you need to do is enter the loan parameters. 

Read on to know how to calculate personal loan EMI using a personal loan calculator in three easy steps.

Step 1: Adjust the slide or input the loan amount you want

Step 2: Move the next slider to select the repayment tenor

Step 3: Finally, adjust the rate of interest 

Then, on the left, you can see your EMI outgo, total payable interest amount and total loan payment, that is, the principal plus the interest amount.

For example, if you set the loan amount slider to Rs. 20 lakh, the tenor slider to 60 months and the interest rate slider to 12%, then the loan EMI is Rs. 44,489, total interest outgo is Rs. 6,69,330 and total cost of the loan is Rs. 26,69,330. It’s as easy as that! 

What are the benefits of using a personal loan calculator?

Using a personal loan calculator helps you make an informed financial decision. Furthermore, it offers multiple benefits such as:

- It allows you to compare loan deals from various lenders

- Helps you understand your repayment structure

- Helps you choose the right repayment tenor and loan amount

- Saves time and gives you exact results

- Can be easily accessed anywhere

Now that you know how to find out your EMI amount using a personal loan calculator, apply for a personal loan with the right lender. When you avail of the Bajaj Finserv Personal Loan, you get access to a principal of up to Rs. 25 lakh, repayable over a maximum tenor of 60 months at a competitive rate of interest. 

Courtesy of the simple eligibility criteria and hassle-free application process, Bajaj Finserv offers you instant financing with approval within 5 minutes and disbursal in as soon as 24 hours. To get access to this through a personalised deal, check your pre-approved offer today.