Formula to Determine Personal Loan EMI
Whenever applying for a credit facility, get an estimate of your monthly obligations to check if the offer is affordable for you.
Use the following formula to calculate your EMIs:
E = P x R x (1+r)^n/((1+r)^N – 1
The following are the meanings of the variable provided in the formula above:
1. Navigate to the ‘Personal Loan EMI Calculator’
2. Adjust the slider to choose the loan amount you wish to borrow
3. Then select the interest rate in % and the tenure in months
4. Your payable EMI amount will be displayed on the screen
The loan amount is the principal amount that you wish to borrow from a lender or a financial institution. Your EMI amount is directly proportionate to your loan amount. This means if your loan amount is high, then the EMI amount will also be high.
The interest rate is the rate at which the lender or financial institution charges interest on your personal loan. A higher interest rate will result in a higher EMI.
The tenure is the duration for which you wish to take the loan. A longer tenure will result in a lower EMI, but you will end up paying more interest over the loan's lifetime.
Most banks and financial institutions allow you to prepay your loan partially or completely. If you plan to make prepayments, it is important to factor in these payments while calculating your EMI. At Fibe, there are no prepayment charges. So you can close your loan anytime.
One of the most notable benefits of using a personal loan calculator is that it allows better financial planning. It gives you a clear understanding of how much EMI you will have to pay against your borrowing. You just need to decide on your loan amount and tenure and prepare your monthly budget accordingly.
This online tool also lets you compare different lending options based on the total obligation. This helps you choose a cost-effective option.
You can calculate a correct estimate of the EMI amount that you need to pay. Thus, it allows you to efficiently plan for repayment and avoid default during the entire tenure.
Manually calculating the EMI can be a time-consuming process. However, you can get the results instantly if you use an online EMI calculator.
You can use Fibe’s Personal Loan EMI Calculator to determine the monthly instalment amount. Just provide the loan amount, interest rate and repayment tenure to get the EMI amount in seconds.
EMI or Equated Monthly Instalment is the monthly payout a customer needs to make against the loan. It is generally a sum of the principal amount and interest paid on a loan that is repaid over a tenure of the customer’s choosing.
Below are the factors that affect loan EMI amount:
EMI Calculators help in choosing the right loan option. It gives you an understanding of how much your monthly instalment will be and how to plan your finances better.
An EMI calculator is a financial tool that helps you to calculate your EMI amount before applying for a loan. It can be used for multiple types of loans such as personal loans, home loans, etc.
You can calculate the EMI amount by following a few simple steps mentioned below:
The EMI calculator works on different factors like loan amount, tenure and interest rate. Once you provide the details, it instantly shows you the EMI amount which needs to be paid monthly toward your loan.
You can find out the your loan interest rate using the below formula:
Rate = Annual Rate of Int./12/100
To calculate the EMI amount, you need loan amount, interest rate and tenure. In this case, the principal amount is ₹5 lakh (P), interest rate is 2% (r) per month and 5 years (n) is the tenure.
You can use a personal loan EMI calculator to get the exact EMI amount in seconds or use below formula:
EMI = (P * r * (1 + r)^n) / ((1 + r)^n – 1)
The EMI amount will be ₹11,236/month in the above illustration.
If your EMI payment is missed, the lender can charge you late fees, your credit score can be negatively affected and there can be additional charges and increase in your monthly interest rate.
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