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Here’s Why You Should Calculate Personal Loan EMI Beforehand

Posted last February 16, 2018, 12:29 am in Services report article

Mr. Vibhuti Narayan Mishra, a Kanpur resident, had to urgently avail a personal loan of Rs.20 lakh to pay for the medical bills incurred for his brother’s treatment in a city hospital.

He had maintained a good CIBIL score, had a consistent flow of income and a clean repayment history which has helped him get through the personal loan eligibility. Although, he got the personal loan in time, what he missed was calculating the personal loan EMI that he would be paying over a 3-year tenor which he had selected.

Everything was going well until he had to cough up most of his income towards the treatment of his brother once again and it made him difficult to pay personal loan EMIs on time. He even bounced his EMI payment due date twice which negatively affected credit score.

There may be many reasons why you would need to avail a personal loan. And while you pay attention to all the little details, perhaps the one number you need to understand best is the EMI – How much are you likely to be repaying every month.

What is a personal loan?

A personal loan is an unsecured loan which means that you need not keep collateral or security, unlike home loans.

It also means that if you have a Credit Score of 750 or more, an income matching lender’s criterion, you can grab a personal loan for immediate needs. However, since it’s an unsecured loan, the personal loan interest rate is on the higher side.

A personal loan is approved instantly, and you can expect money in your bank account in 24 hours and helps to cover many needs such as a wedding, other expenses and more.

The importance of calculating personal loan EMI beforehand

Is not it better if you know how much you need to put in monthly to repay your personal loan? That gives more power to you, right? An EMI (Equated Monthly Instalment) is what you pay each month to your lender for a tenor to repay your personal loan.

A personal loan applicant should always assess his affordability for a personal loan figure that he/she intends to avail and apply only after analysing if it will be easy to repay. If you don’t do it, you may have to bear the consequences later as discussed in the above case.

Personal loan EMI calculator helps you calculate EMI super-quick

Modern finances have paved the way for modern tools to help you calculate personal loan EMIs on the go. A personal loan EMI calculator is a tool which is available on a leading lender’s website which you can use to calculate your personal loan EMI.

All that you need to do is select an amount that you seek to borrow and the tenor you wish to repay the loan. Once you do this, the personal loan EMI calculator will display an exact EMI amount that you will pay each month after the approval of the loan.

The Bottom Line

It’s better to stay aware of the EMI amount that you will pay than not to know it at all.

When you know an amount that you would need to put as EMIs, you will able to manage your monthly finances accordingly so that you could repay a personal loan EMI without hassles.