In 2019, RBI announced its fourth consecutive repo-rate cut, leading to a decrease in the MCLR of financial institutions. Thus, in the last few months, lenders have slashed their interest rates, making advances easily accessible.
If you belong to the medical field and are looking to avail loan for doctors like home loan, personal loan, business loan or loan against property, now is the best time to apply for it. However, before applying, it is crucial to calculate the EMI you will need to pay against the advance.
You can use the equation for EMI calculation to get your EMI amount. Or, you can make use of an online EMI calculator to get the accurate repayment amount for each of the above advances.
Calculating the EMI amount should be the first thing on your checklist to apply for a doctor loan.
What is a loan EMI calculator?
A loan EMI calculator is an online tool that can help you to accurately calculate your EMI amount to repay the loan you have availed. Your EMI consists of the principal amount availed and the interest accrued on it. The doctor loan calculator uses three parameters, namely, your principal amount, interest rate and loan tenor to give you your repayment amount.
You can avail these online EMI calculators from the website of financial institutions like Bajaj Finserv.
How is the EMI amount calculated?
The doctor loan EMI calculator uses a pre-set mathematical equation to give your repayment amount.
The equation is as follows
E = [P X R (1+R)^N / ((1+R)^N-1)]
Where, E is EMI amount, P is principal, R is rate of interest and N is loan tenor or number of monthly instalments.
If you calculate the EMI manually, it can take you a long time and also leave room for errors. Using the calculator is faster and much more efficient and gives you accurate results.
How to use the calculator?
Using the online calculator for EMI calculation is extremely simple. You can do it by following the steps below:
- Visit the loan calculator page of your financial institution.
- Enter the details- principal, interest rate and tenor, correctly.
- Click on “calculate EMI.”
The calculator will then give the accurate amount you will need to pay each month while repaying your loan.
Why should you use the calculator?
Using the doctor loan calculator has numerous benefits. These are-
- It is much more efficient
Calculating your loan manually can be a cumbersome process. But, if you use the calculator, you can get your EMI amount in a matter of seconds. However, you must make sure that the information you have entered is accurate. Entering the wrong details will give you the wrong EMI amount.
- It can help you to plan your future finances better
You can avail the EMI calculator to know your doctor loan EMI amount before applying for the advance. When you know your repayment amount beforehand, you can decide the loan amount you can afford to avail. This can help you to reduce the risk of default on your repayment. Not calculating the right advance amount is one of the mistakes you should avoid making while applying for a doctor loan.
- You can use it without restrictions
You can use the loan calculator as many times as you want, whenever you want to. Thus, the calculation of EMI becomes much more accessible with it.
- Helps you to avail various schedules
Using an online calculator can also help you to view various combinations of interest rates and loan tenor, helping you to settle for the amount that you can repay comfortably.
Thus, whether you are applying for a secured or unsecured doctor loan, it is best to know your EMI amount using a loan calculator before applying. Given the risks that come with defaulting in loan repayments, calculating your EMI should be your first priority while planning to avail any advance.
