Before we start discussing the benefits of using an SBI personal loan EMI calculator, let’s see why a person opts for a personal loan. A personal loan is a versatile yet unsecured loan, which people can avail for a variety of purposes. It can be for funding a trip, some unforeseen expenses, paying off credit card debt, home renovation, vacation, medical emergency or anything else. One thing that makes this loan very lucrative is that one doesn’t need to disclose the reason for availing this loan to the lenders. Again, it doesn’t require any kind of collateral. Moreover, it gets approved easily with minimal paperwork. At times, if one is already a bank customer, there are chances that it is pre-approved too.
But, however easy and convenient it is, the end result is that you need to pay the Equated Monthly Installments (EMIs) for the amount you have availed. These EMIs will go from your hard-earned money month after month for the entire tenure of the loan. Thus, before opting for any loan, you should know about the amount that you will have to pay every month in EMIs. The SBI personal loan EMI calculator is the best available tool to calculate that and you can easily choose the most suitable loan amount and tenure accordingly.
Why Should One Make Use of an EMI Calculator?
If you know beforehand the liability that you are getting yourself into every month for the next 3 or 4 years, it helps in preparing yourself both mentally and financially. Let’s say you compared various personal loan lenders and found that SBI Bank Personal Loan is the best option for you. Now, the next step is to see what amount of loan you want. With the help of SBI online loan calculator, you can find the amount of EMI that you need to pay on that amount. It is a smart and time-saving tool, which uses a simple algorithm to arrive at the EMI amount almost instantly. Thus, it saves you from the trouble of the manual ways of calculating using the complex EMI calculation formula, which is:
E = P x r x (1+r) ^n/ ((1+r) ^n – 1)
E stands for the EMI amount paid on a monthly basis
P is the amount borrowed
r is the rate of interest
n is the duration in a year, so if it is 1 year (12 months), then n=12; for 2 years, n=24 and so on
This formula will scare most of the people, especially if they are bad at math. Thus, using the simple tool called SBI personal loan EMI calculator is often a preferred option. It helps in arriving at the EMI amount by inputting two simple values, which are of the amount of loan required or Principal and the tenure. Once you input these values, you would instantly get the EMI amount that you need to pay. There is one more variable in play, which is the interest rate, but then it is not in your hands – it is at the discretion of the lending agency.
Major Reasons to Use an EMI Calculator
There are numerous benefits that aid in the popularity of SBI personal loan EMI calculator. Here are the reasons that justify its usage:
Easy and Convenient: The manual calculations using the mathematical formula is a long, tedious process. It also has a large scope of making mistakes. This smart tool, on the other hand, lets you know the EMI amount instantly in an appealing manner. The scope of making errors is also almost negligible.
Allows You to Check for Your Eligibility Amount: Not all individuals have access to a particular amount of personal loan. By using the SBI personal loan eligibility calculator, you can find the amount for which you are eligible.
Additional Read: Features and benefits of SBI Personal Loan EMI Calculator
Check for the Amount of EMI You Are Comfortable Paying: Even if you are eligible for a higher amount, you might not be comfortable paying for its EMI. Thus, input various amounts and tenures in the SBI bank personal loan EMI calculator and arrive at the one that suits your requirements the best.
Check If Prepaying the Loan Makes Sense: If you think that you might be able to prepay the loan in the near future, then too these calculators help. They give the breakup of the principal and the interest part in each EMI, which helps you in deciding whether it makes sense to prepay or not. In case you find that the EMI you are paying at the point when you want to prepay is having a large amount of principal and very little interest component, then there is no point in repaying. You can then actually invest that amount in some other option and earn better rewards on it rather than using it for pre-paying the loan.
The personal loans do carry higher interest rates as they are unsecured loans. But, they give the flexibility of availing a loan to meet an immediate fund requirement that cannot be otherwise met using your monthly income or in emergency situations. To successfully repay this loan, you should know how much amount to need to pay every month and SBI personal loan EMI calculator is the perfect tool for that.