A loan against property allows the borrowers to have several possibilities to meet their financial requirements. However, paying EMIs with floating rates of interest might be a burden for the customers in case of managing their expenses.
Therefore, it is desirable to use a property loan calculator online. It is a handy tool that can show effective results based on the entered information. It is beneficial in calculating a sizeable loan amount and repayment tenor according to the financial capacity of the borrowers.
What are the benefits of using a property loan calculator?
A property loan eligibility calculator can help individuals in many ways to get a LAP. Some of the benefits of it are given below:
- Accurate calculations
The borrowers do not have to calculate their EMIs manually anymore. They can now simply calculate their potential EMIs online through a property loan calculator, which works on a digital formula. It ensures accurate results, saving both effort and time for the customers.
- Instant results
Such online calculators have also replaced the time-consuming manual computations by providing customers with accurate results instantly. It does speedy calculations according to the information given and displays error-free results in no time.
- Easy availability
It is also an online tool that can be easily used by anyone from anywhere with an internet connection. It is available 24 hours on the official website of the lending institution and requires no additional charges for usage. Hence, it is a free tool that can be used as many times as the customers want to reach a desirable conclusion regarding their EMIs.
- Different combinations
A property loan calculator is also effective enough to use a combination of different factors to show a desirable result. It can take into account essential points such as repayment tenor, principal loan amount, rates of interest etc. to provide the customer with a suitable amount as their EMI.
- Easier comparison
Along with calculating EMIs, it also enables the borrowers to compare the property loan benefits and other offerings across various lending institutions. It helps them in getting aware of their financial capacity and opt for the lenders suitable for them according to their desirable financial terms.
How to use a property loan calculator?
Using such a calculator is hassle-free and easy. The process to use it is given below:
Step 1: Visit the official website of the lending institution and select “Loan Against Property EMI Calculator”
Step 2: Enter the desirable principal amount of a loan against the property
Step 3: Enter the desirable loan repayment tenor
Step 4: Enter the rate of interest
After considering the information provided by the customer, the calculator will display the tentative EMI amount, the total payable interest and the total loan repayment amount.
What is the formula of a loan against property calculator?
It uses a digital formula to provide an error-free result to the customers, as given below:
EMI = [P x R x (1+R) ^N]/[(1+R) ^N-1]
The P in the formula stands for the principal loan amount, R for the rate of interest and N for the number of EMIs or the repayment tenor.
What are the factors affecting loan against property EMI?
It is always desirable to check the liabilities before opting for a loan against property. Once the borrowers are aware of the significance and usage of a property loan calculator, they should have a comprehensive knowledge of the various factors that affect EMIs. Some of them are given below:
- Loan principal
The principal is the amount which the borrowers get as their loan. In the case of property loans, the maximum loan amount can be 80% of the total property value and 90% of the market price of the immovable asset. Hence, the amount of the monthly instalments is influenced by the principal amount.
- Loan repayment tenor
It is the stipulated timeline within which the debt needs to be settled. Since a loan against property is among high-valued loans, it tends to have an increased flexibility of repayment. The borrowers can have the option of repaying such loans within an extended loan repayment tenor of up to 15 years.
- Rate of interest
It is the rate of interest at which the borrowers will have to repay their loan. It is decided according to various factors including the market conditions, the customer’s eligibility and others. EMI is reduced with an extended tenor. However, with a longer tenor, the total interest outgo also increases. Hence, individuals can calculate the total interest and an appropriate tenor based on their loan amount.
There are lending institutions that provide pre-approved loan offers on loans like home loans, loans against property. Such offers are applicable to their existing borrowers and are based on their credibility. Individuals can check these offers on their lender’s website by entering their name and other details.
Therefore, with a comprehensive knowledge of a property loan calculator, the borrowers can have a more informed approach in deciding their favourable loan conditions. Along with that, they can also use an area conversion calculator to be aware of the correct value of their land area conversion.