When it comes to deciding on a housing loan, knowing your home loan EMIs (Equated Monthly Instalments) is of utmost importance. BankBazaar's home loan EMI calculator is a simple online tool to calculate your EMIs. All you have to do is key in a few inputs like the principal amount, rate of interest, processing fees and tenure of the home loan to compute the EMI on the loan. The calculator will also give you a detailed amortization table illustrating your debt repayments, i.e., your EMI contributions towards the interest and principal component of your home loan on a monthly and annual basis.
n: Number of monthly instalments
r: The rate of interest applicable on your home loan
P: Principal amount
The rate of interest associated with Bank of Baroda home loans as of 23 Apr 2019 starts from 9.65% p.a. Based on the risk rating of the applicant the bank can choose to revise the rate of interest on your home loan.
The processing fee associated with Bank of Baroda home loans as of 23 Apr 2019 is as follows:
|Loan Slab||Processing Fee|
|Up to Rs.50 lakh||0.50% of the principal loan amount Minimum: Rs.7,500 Maximum: Rs.12,500|
|Above Rs.50 lakh||0.25% of the principal loan amount Minimum: Rs.7,500 Maximum: Rs.20,000|
The above processing fees are exclusive of taxes and any applicable surcharges on the fee will be added later by the bank during the time of payment.
The maximum home loan amount one can avail from the Bank of Baroda depends on the location and monthly income of the home loan applicant. The maximum loan amount an applicant can avail in metro cities could range from Rs.5 crore to Rs.10 crore while the applicants in rural and semi-urban areas are restricted to Rs. 1 crore.
Similarly, the tenure on the home loan can be extended up to 30 years based on the loan amount and the income of the applicant.
Let us assume that you are looking to avail a housing loan of Rs.30 lakh from Bank of Baroda at an interest rate of 10.00% p.a. over a period of 30 years. Let us consider that the processing fee levied on your loan is Rs.10,000. Enter the necessary inputs and click on ‘Calculate’.
As per the values entered, the EMI calculated on your home loan will be Rs.26,327.
The break-up of the total amount payable will be as follows:
|Total interest due||Rs.64,77,773|
|Total Amount Payable||Rs.94,87,773|
The calculator should also be able to provide you with the amortization table where your debt repayments over the next 30 years from March 2019 to February 2049 will be illustrated on a monthly basis.
|Year||Interest Amount Paid (A)||Principal Amount Paid (B)||Total Amount Paid (A + B)||Outstanding Loan Balance|
Before you decided on the tenure of your home loan, it is advised to consider the following aspects to help you decide better.
Age: Most home loan lenders in the country consider age of the applicant before deciding the tenure on his/her home loan. Your age is inversely proportional to your home loan tenure. If you are in your 20s or 30s, opting for a long-term home loan would be a wiser decision as you would have enough time to clear your home loan debt.
On the other hand, if you are in your 40s/50s or nearing retirement, you can consider opting for a short-term home loan as you would only have a limited span of time to clear your home loans. However, for those nearing their retirement age, he/she can consider making their child as the co-applicant to extend the loan tenure. The lender will extend the home loan tenure based on the age of the co-applicant. The only requirement is he/she should also be the co-owner of the property. Hence, it is advised to consider your age before you decide on the tenure of the home loan to make sure your finances are not impacted by the EMIs.
Income: Your monthly income also plays a major role in deciding the tenure of your home loan. If you are earning a lower income but opt for a short-term home loan, the probability of your finances being impacted and defaulting on your home loan EMIs are high. This is because short-term home loans attract higher Equated Monthly Instalments (EMIs) compared to the long-term loans. In such cases, opting for a long-term tenure would be good decision.
On the other hand, you can go for a short-term home loan if you have a high monthly income. This will give the benefit of managing your finances better despite repaying the home loan debts with high EMIs. You can also consider increasing your EMIs during the tenure to get rid of the home loan burden sooner. However, it is advised to revise your budget before you raise your EMIs as the high monthly instalments could affect your personal finances and burn a hole in your pocket.
Rate of Interest: The interest rate applicable on your home loan is the cost of credit you will be paying for the loan during the tenure. The rate of interest is directly proportional to the tenure of your loan. The longer your tenure is, the higher the interest rate will be. This will also result in higher EMIs during the tenure, increasing the total cost of credit on your home loan.
You can always utilize the home loan EMI calculator to get a better idea of how your home loan EMI payments will be. All you have to do is key in the necessary input on the EMI calculator and you will be provided with the EMI that will have to be made against your loan along with the break-up of the total amount payable during the tenure. You can also go through the amortization schedule to learn more about your EMI payments, i.e., how much of your monthly instalments are being attributed towards the principal and interest components of your home loan.
Loan Tenure: The tenure on your home loan plays a major role in deciding the monthly instalments to be made against your loan. The home loan tenure is indirectly proportional to the payable EMIs. Long term home loans attract lower interest rates, bringing down your EMIs. Short-term loans, however, attract higher EMIs as you will have to clear your home loan debt in a short span of time.
Principal amount: The principal is the initial loan amount you borrow from the home loan lender. The principal amount is directly proportional to the payable Equated Monthly Instalments (EMIs). The larger the principal is, the higher your EMIs will be.
Interest Rate: The rate of interest associated with the home loan is directly proportional to the EMIs payable against a home loan. The higher the interest rates, the higher your EMIs will be. If you are availing a floating rate home loan, your EMIs can be revised by the lenders if there are any changes in the interest rates.
1. What is the purpose of a Home Loan EMI Calculator?
The Home Loan EMI Calculator is a simple tool that helps you get an idea of how much your Equated Monthly Instalments (EMIs) can be by taking various components such as the principal amount, tenure of your home and interest rate into account.
2. What is Amortization Schedule?
The Amortization Schedule is a table illustrating your home loan debt repayments over the tenure on a monthly as well as annual basis. The table also indicates the break-up of your home loan EMIs towards the principal and interest component of your home loan.
3. Can I make prepayments on my home loan?
Yes, you can make prepayments on your loan during the tenure. This will allow you to bring down the outstanding principal which you can either choose to reduce the tenure of your loan or lower the rate of interest, resulting in reduced EMIs.
4. What are the tax benefits on Home Loan EMIs?
Under Section 80 C of the IT Act, taxpayers are eligible to avail tax benefits up to Rs.1.50 lakh on the principal repayment of your home loan. In the same line, you can claim tax deductions up to Rs.2 lakh on interest component of your home loan under Section 24 B of the Income Tax Act.
5. How is Pre-EMI different from EMI?
Home loan lenders do not disburse the entire loan amount in one payment. Your home loan will be disbursed as instalments taking the progress of your project into account. Pre-EMI is the interest paid only on the partially disbursed home loan. EMI, on the other hand, starts only after the entire loan amount has been disbursed.
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