Like every other loan, a loan against property or Loan Against Property also requires borrowers to pay EMIs until the entire amount is repaid.
During the beginning of the repayment tenor, borrowers are required to pay EMIs that mainly cover the interest amount. Additionally, if borrowers choose a longer repayment tenor, they will have to pay lower EMIs.
To ensure hassle-free repayment, borrowers can use a loan against property EMI calculator to determine the monthly instalments beforehand.
How to determine EMI using a calculator?
Borrowers can choose to calculate their monthly instalments manually. But manual calculations often lead to erroneous results. So, to avoid any such error, borrowers can use this online tool to calculate different types of loan against property EMI and plan their finances accordingly.
Borrowers can use this calculator by following these below-mentioned steps-
Step 1- Borrowers need to enter the desired principal amount
Step 2- Input repayment tenor
Step 3- Lastly, borrowers need to input the applicable interest rate
Upon entering the necessary information, the calculator follows a mathematical formula to do the calculation. It is as follows:
EMI- [P x R x (1+R) ^N] / [(1+R) ^ N-1]
Here, P stands for Principal amount, R denotes interest rate, and N refers to the repayment tenor.
This online tool will display your monthly instalments, overall payable interest, and the entire loan cost against property. One of the major benefits of this calculator is that users can adjust principal amount and repayment tenor to attain a suitable EMI that fits their budget.
Besides, borrowers can access a loan against property interest rate calculator to compare and choose the best Loan Against Property deals. Therefore, these calculators further help borrowers to plan their repayment better while choosing the best lender with competitive interest rates.
Factors affecting Loan Against Property EMI
Although calculating loan against property EMI is a complicated and time-consuming process, an online EMI calculator makes it convenient for the borrowers. But certain factors affect EMI payable, which borrowers must know, and they are-
- Principal value
The individuals borrow this amount from financial institutions based on the property’s market value. Therefore, if the borrowed principal amount is larger, EMI calculator for home loan will be more. Note that lenders offer an LTV of up to 75% for a Loan Against Property .
- Repayment tenor
One of the most important determinants of EMIs is repayment tenor. Essential factors like a borrower’s current and retirement age, financial liabilities, interest rate impact a loan’s tenor. However, if a borrower chooses a longer tenor, EMIs will be lower.
- Interest rate
The factor that determines the repayment and financial capability of a borrower to avail Loan Against Property is the interest rate. For example, if the interest rate is higher, borrowers are advised not decide on loan amount carefully as EMIs will also be higher. This can further add financial stress for the borrower.
On the contrary, if interest rate is lower, loan repayment becomes flexible, and borrowers can apply for a high-loan quantum. Borrowers must note that credit score and borrower’s credit profile also impact Loan Against Property interest rate.
Apart from these factors, when existing borrowers opt for a loan against property balance transfer, they can reduce EMI burden.
Borrowers who are willing to know how to apply for a loan against property must use this online calculator beforehand to get an accurate estimation of their monthly instalments.
Prospective borrowers (salaried and self-employed) must know that reputed HFCs extend high loan quantum at an affordable interest rate and flexible tenor.
On top of that, existing borrowers can also avail exclusive pre-approved offers that simplify and expedite the loan application process. They can check their pre-approved offers by entering names and contact numbers.
Besides EMIs, before applying for a loan against property, borrowers must not ignore processing fees, application charges, etc., that impact the overall borrowing cost.