From a recent report of Economic Times, every two out of three financially stable individuals seek help from a financial advisor. It concludes their hesitation in making independent financial decisions.
The possible reasons for this could be –
- Lack of knowledge regarding various financial aspects like debt-to-income ratio, credit utilisation ratio, etc.
- The apprehension of risk involved in seeking big-ticket loans like home loans
- Absence of financial planning
To solve this issue, one can learn the intricate concept of managing finance and loans for property purchase and similar important financial decisions.
Therefore, candidates looking to avail housing loan opportunities can utilise house loan EMI calculator and get an idea about their upcoming financial obligations.
Subsequently, following are the five ways you can turn your home loan EMI calculator into a tool supporting your financial planning.
Ways in which home loan EMI calculator helps plan finances –
- Simplified and accurate calculations
Calculating equated monthly instalments requires the knowledge of different financial variants such as the principal amount, rate of interest per annum, and loan tenor. These variables are replaced in the formula for EMI calculation.
The formula involves intricate mathematical calculations, and hence can be complicated to compute for a novice. Subsequently, individuals looking for suitable home loan options can make use of this calculator and find out EMIs with precision and utmost accuracy.
- Choosing an appropriate lending institution
One can change the calculator variables and see how it affects the instalment amount when using the EMI calculator.
Candidates can, therefore, first research on housing loan prospects from different financial corporations and input principal, tenor and rate in the EMI calculator. Subsequently, they can carry a comparative analysis of the available options and choose the best one.
- Calculating financial obligations
Individuals can have fixed financial obligations they are bound to meet in a month. These can be from other active loans, investment, educational or medical expenses.
As for purchasing a home, it is a major financial decision that can put a strain on their monthly obligations.
So, if one qualifies the home loan eligibility, then the first thing he/she should do is calculate how much to pay each month for the rest of the loan tenor. Accordingly, they can choose the loan amount and tenor to keep financial obligations within their repayment capacity.
While some people may be pro in mathematics, others may find the idea of calculating EMIs through conventional method very tedious.
Consequently, home loan EMI calculator comes to their aid as one can calculate EMIs just by inputting required data. It is a more convenient and time-saving option for borrowers willing to apply for a home loan.
- Determining goals
Wisely planning your finances is an important step in achieving your goals. Calculating EMIs beforehand using the home loan EMI calculator will help in determining the fixed monthly outgo.
It eventually helps in simplifying the planning process as you have a clear idea of the available funds.
The remaining money can be allocated to meet other financial goals like saving, investing in schemes, etc. These goals will be more achievable as you plan your finances wisely.
Using a home construction loan to build your dream home can also be among the most feasible options. Borrowers have the tool to calculate, compare, and make a sound financial decision for their housing loan.
Subsequently, a comparison of interest rates is also essential in evaluating estimated monthly instalments. Availing a housing loan at the lowest interest rate accompanied with the benefit of fixed-floating interest rate comparison fetches the highest affordability.