Home Loan Calculators - Helping You to Make the Right Financial Decision

Owning a home or an apartment is everyone’s dream. If you’re planning to take one, take the help of a Home Loan calculator to make your calculations easy.

The easy availability of Home Loans and a low interest rate make it easy for most people to realize their dream of buying a home. However, a Home Loan is a big commitment which needs to be given a lot of thought before availing one. Home Loan calculators might be able to help you make the right choice.

How can the different types of Home Loan Calculators help you?

There are many calculators that you can make use of like:

  • Home Loan Eligibility Calculator

  • Home Loan EMI Calculator

  • Home Loan Part Prepayment Calculator

  • Home Loan Foreclosure Calculator

Using Home Loan Calculators to the best effect

You need to determine if you can afford the house you are buying right now. So, first, find your Home Loan eligibility. Before you use a Home Loan eligibility calculator, work out your monthly budget and your income vs expenses. If you are paying EMIs on other loans, include those EMIs too in your monthly outgo. You can also factor in your yearly IT dues, to get a very clear idea of the amount you can actually spare for the loan.

This can also be considered as a borrowing capacity calculator. Home Loan eligibility calculator calculates your loan eligibility based on your age and monthly income. You need to give an account of your existing EMI payments, if any. You have the option of entering your extra income details as well.

The calculator then takes in all the inputs, and then give you the loan amount that you can avail. This amount can be more or less than what you need and it depends on your monthly income and the current market rates.

Don’t opt for a higher loan amount just because the calculator says you are eligible for it. Just choose the amount you need to buy the home you want. If you have not already chosen one, then you can choose one based on the loan amount you can avail.

However, find out the EMI that you’ll need to pay, before that.

Home Loan EMI Calculator

Home Loan EMI Calculator calculates the monthly repayments you will have to make on the loan. You can try different parameters here - change the loan amount, change tenor- to find out the different EMI options. Always choose the highest EMI you can afford to keep the loan tenor as short as possible. Longer tenures translate into higher interest amount on the loan.

The formula for calculating loan EMI is:

EMI = [P x R x (1+R)^N]/[(1+R)^N-1]

  • P - Principal or amount borrowed

  • R - Monthly interest rate

  • N - Tenor of the loan in number of months

The Housing Loan interest calculator is a tool used to find the monthly interest rate, given the annual interest rate, to determine the EMI.

Part Prepayments Calculator

When you choose a few loan offers, look at the prepayments that they allow you to make, each year without penalty. Generally, if you make advance payments on loans beside the EMI, lenders can apply a charge on it. This is because if you pay off the loan before tenure they will lose out on interest earnings.

Still, many Home Loans now come with a clause that allow you to make certain number of prepayments each year, not exceeding a maximum cap. You can use this facility to pay off the loan faster, and bring down your interest amount outgo.

Home Loan Prepayment Calculator help you determine how much interest you can save by making regular extra repayments, which in turn will reduce the tenor as well.

Home Loan Foreclosure Calculator

This lets you calculate how much interest amount you can save by paying off the loan before full tenor. You have to feed in the loan amount, tenor, EMIs you have already paid. The calculator will then tell you how much you will save as far as the interest is concerned.

To Conclude

The eligibility calculator tells you how much you can afford to borrow right now. Don’t borrow more than you will need. Also, remember that you need to pay the registration charges, stamp duty, etc. The sum total of these isn’t a small amount.

If you can afford all these, apply for the loan. Keep up with the Housing Loan EMIs, don't miss payments. Make prepayments to shorten loan tenure and bring down the total interest amount. Close the loan quickly, to save money and also to be free of a huge debt. However, don’t get penalised in the process.

Use all the Home Loan calculators to find the optimal amount you can borrow and choose the highest EMI you can afford to shorten the tenor of the loan. While processing the loan, the bank or NBFC will assume that you can spare around 45% of your total income towards loan EMIs. Your credit rating will also affect your loan eligibility. 

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