A Personal Loan eligibility calculator helps you to estimate how much you can borrow. Personal Loan eligibility generally depends on key factors, such as your income, existing financial commitments, credit score, and overall repayment capacity. Criteria may vary slightly for salaried and self-employed individuals. For example, stable employment with regular income is often considered for salaried applicants, while business vintage and annual turnover are usually assessed for self-employed professionals.
The Personal Loan eligibility calculator considers your age, net monthly income, and net monthly commitments to give you an idea of the maximum amount you can borrow. Let us understand how it helps.
How to use the Personal Loan EMI calculator?
Using the Personal Loan EMI calculator is straightforward and does not require any advanced financial knowledge. Here is a quick step-by-step guide:
- Enter the total Personal Loan amount you plan to borrow.
- Adjust the interest rate to the typical rate offered based on your credit profile.
- Select your repayment tenure. You can choose a Loan period, usually ranging from 12 to 60 months.
- The calculator will instantly show your monthly EMI, total interest payable, and total repayment amount.
You can tweak the numbers to compare different Loan combinations and select the one that suits your financial goals.
How does a calculator help with financial planning?
Using an EMI calculator before taking a Personal Loan is not just convenient, it is smart. Here is how it helps in financial planning:
- Budget clarity
Knowing your EMI in advance helps you determine whether the repayment fits comfortably within your monthly income. This ensures your Loan does not disrupt essential spending or savings.
- Prevents over-borrowing
If you see the EMI impact in real time, you may borrow more than you can afford, helping avoid future financial strain or defaults.
- Easy to use
Personal Loan EMI calculators are user-friendly. Anybody can input the Loan amount, interest rate, and tenure provided by the lender and get quick results.
- Time saving
EMI calculators provide instant and accurate results. You need not visit the lender, stand in queues, or perform manual calculations.
- Build a decent credit score
If you calculate your EMIs in advance, you will stay within your budget. There are fewer chances of default or delay. Consistently maintaining a good repayment habit automatically increases your credit score.
How to reduce your EMI for a Personal Loan?
There are mainly two ways to reduce your EMI for a Personal Loan:
- Select a longer payment tenure, as this helps spread your EMI payments over a longer period. This automatically reduces the EMI amount. You can use the Personal Loan eligibility calculator to calculate the EMI amount in advance and accordingly choose the tenure.
- Find a lender providing a lower interest rate. If your interest rates are low, it can reduce the total Loan cost and make it more affordable. A decent CIBIL score can help you secure lower interest rates.
Conclusion
You can adjust the interest rate and tenure as per your preference to get an idea of different scenarios. Once you are satisfied with the Personal Loan eligibility check, you can proceed with the Loan application.
