The full form of EMI is equatedv monthly instalment which is a fixed amount of payment the borrower has to make to the lender at a specified date on a monthly basis EMIs have your principal amount and the interest amount that you are supposed to pay every month.
Here’s all you need to know about an EMI calculator
Say for instance you have decided that you are about to take a loan, it might be a car loan, or a home loan or personal loan. The first step of taking the loan is nothing but just sitting down and making a serious calculation of how much is it going to cost you. This cost is calculated in the terms of the monthly payment that needs t be done towards the loan and these are called the EMIs or the Equated monthly instalments.
Once you need to get the exact EMI, you need to calculate the amount borrowed and the interest that you are supposed to be paying on the principal amount and the processing fee for the loan that you have taken.Once you have all this information you have to sit down with a pen and paper to see how much will you have to pay monthly for the amount of loan that you have taken or the amount of loan you have decided to take and you will also have to take into consideration that tenure of the loan i.e. the period through which you are going t pay the full amount of the loan. One that is done , it might strike you that the EMI is way too big and you will reduce it in some way or the other in order to do it you have to either lessen the tine period of the loan i.e. the loan tenure or you have to borrow less. When that is decided, you have to calculate all over again. One you have the right EMI, you have to start looking at the banks and other financial institutions that are ready to give that amount as a loan. When you find an institution they will give you a quote and you will once again realise that you have to do the calculations over again. Doing the calculations over and over again is tiring and there is a chance that you might goof up. You have to make sure that while doing these loan calculation you do not make any mistake at all. Therefore there are many websites of banks and other financial institutions that offer EMI calculators that do it for you. These EMI calculators have slots which you need to fill in. You have to fill in the amount of the loan, the tenure of the loan and the interest rate. Once all of this basic information and other information that is asked for is filled in the EMI calculators will calculate your monthly EMI fast and accurately and will save you the time and effort of it.
Therefore in order to do the loan EMI calculations in an efficient and accurate manner it is always advised to use an EMI calculator.