Do you know how to calculate EMI? EMI can be calculated in various ways. You can either do it at home using your basic calculator for use an online EMI calculator. There are a lot of online calculators available that help in calculating EMI. The calculators calculate the EMI and give you the result of your remaining balance to be paid.
What Is A Car Loan Calculator
A car loan calculator is a software that helps you to calculate your monthly installments. When you acquire loans from any financial institution, you are asked to repay back the loan in monthly payments. The installment you’ll be paying back will include an extra amount in the form of interest. The interest is fixed before granting the loan. The interest rate depends on the type of car you are purchasing.
The calculator will help you to arrive at a final monthly installment that needs to be paid to the financial institution. To estimate the EMI, you need to enter your loan amount, rate of interest, and loan tenure. By providing these details, you will quickly get your EMI result within seconds. There are a lot of car loan calculators available online for your help. You can even calculate your EMI using your basic calculator if you know the formula. If not, then opting for an online calculator is the most convenient option.
Method To Use Car Loan Calculator
There are a lot of online calculators available for your ease. Follow the below-stated steps to arrive at your EMI.
STEP 1: Open any online calculator from the internet.
STEP 2: Enter your loan amount. The loan amount should not exceed more than 40 lacs.
STEP 3: Enter the interest rate you have decided to pay. The interest rate can vary between 2% to 30%. It all depends on the financial institution from where you are taking the loan.
STEP 4: Enter the time period of your loan. As per the law, the tenure of your loan cannot exceed more than seven years.
The interest rate you enter will remain stagnant until the last payment. So before entering into any loan contract, make sure of your capabilities to repay back the loan amount with the interest rate. Some institutions charge even 40 to 50% of the interest rate. Make sure you do the research and get the best deal out.
What Is Generated In The Result
In the result you will get three things:
- OVERALL COST: The calculator will help you find the total cost you will be investing in the loan. The actual loan amount will also show you the extra amount you’ll pay as interest. Therefore you can estimate the overall expense of yours in the car.
- EMI: The calculator will help you find the monthly payment that you are required to make to the financial institution. The EMI will include the divided loan amount along with the interest amount payable.
- BALANCE: The calculator will also show you the result of the remaining amount payable after every EMI. By this, you can efficiently study the remaining balance amount of the loan.
How Does The Calculator Calculate The Result
To find the EMI payable, the calculator uses a math formula to do so.
P is the principal amount
I is the interest rate
T is the tenure of the loan
INT FORMULA = P ÷ T * I ÷ 100
The principal amount to be $30,000
Rate of interest is 4%
Tenure is four years
INT = 30,000/4 = 7500
7500*4/100 = 300
EMI = $7800
How To Find The Agency Charging Least Rate Of Interest
To get a loan with the least rate of interest, you need to do extensive research. The rate of interest offered by banks is different from the price of the car agency. In banks also the rate of interest differs from one another. Car agencies usually charge the highest interest rate. This is because the car agencies provide the loan within 3 to 4 days.
Whereas Bank offers a lower rate of interest, but the procedure takes a long time. Suppose you are ready to spend enough time to complete the process, then Bank will offer an excellent option to get a low-interest rate. Capitall finance is one such company that provides a reasonable rate of interest to its clients.
What Are The Criteria Of Financial Agencies For Granting A Loan
In 2016 the government of Singapore liberated the law on finance. Due to this, a lot of liberty has come in the hands of people.
- In order to acquire a car loan, an individual must be 20 or above 20.
- He should be a citizen of the country. There are a lot of other agencies to provide loans to foreigners, so; this doesn’t become a hitch.
- The Bank can grant loans with a minimum amount of 1 lakh and a maximum amount of 40 lacs.
- The tenure of the loan should vary between 1 to 7 years. The loan period cannot exceed even by a day when once completed seven years.
- The rate of interest ultimately depends on the financial institution from where you are acquiring the loan.
- The interest rate of a new car is different from an old car.
What Happens If You Fail To Make The Payments
The financial institution takes each and every detail from you. This starts with your name and the number of properties you hold. At the time of granting you the loan, the financial institution asks you to submit specific property papers that you currently contain. The financial institution makes an agreement with you, which states that the property papers held by the institution will permanently go to them if you fail to make the payment.
This means if you fail to make the payment, you will lose out on the properties you have given in the hand of the institution. The institution has a complete right to confiscate your property due to the non-payment of the loan.