Everyone has a dream of owning a house, and you might be one of them. Now, thanks to a home loan, you get the chance to fulfil your dreams. The private banks in India will start offering you loans starting from 3 lakh rupees. The home loan comes with multiple benefits like smaller EMIs. This way, you get to space out the payment for a longer tenure span. Apart from that, you have attractive interest rates, easy application procedures, doorstep services, and so much more.
Other than the starting amount and smaller EMIs, there is no pre-payment charge on the reputed banks offer home loans without any prepayment charge. Moreover, you have fixed and floating interest rates over here as well.
However, before proceeding further and getting your hands on the home loan, it is important to learn more about how to calculate your home loan EMIs.
Calculating home loan EMIs:
With all the proper documents in your hand and the prompt follow-ups, you won’t have to wait for more than 15 days to get your home loans approved! With the help of a home loan calculator, you will get an estimated amount of EMIs to be paid every month to cover up the home loan. So, everything will work in your favour and with ease!
Home Loan EMI Calculation Formula = [P x R x (1+R)^N]/[(1+R)^N-1]
Where,
- P: Loan or principal amount
- R: Interest rate per month
- N: loan tenure in months or number of monthly instalments
*Please note that this EMI calculation formula doesn’t include any home loan processing charges applied by the financial institution.
Let’s take an example to calculate home loan EMI –
Suppose Mrs. Kaur took a home loan of ₹ 3,500,000 (Principal amount) at an interest rate of 8.65% p.a (per annum). The loan tenure (N) is 30 years or 360 months.
After applying the formula, you get:
- P = 3,500,000
- R = 8.65%
- N = 30 years
According to the EMI formula, the monthly instalment amount comes up to ₹27,285.
Mrs. Kaur has to pay an EMI of (₹27,285 x 12 = ₹327,419) in a year.
Ways to apply for a home loan:
There is a generic procedure followed by most banks the maximum bank when it comes to home loan sanction. Understanding the procedures step by step will always help you in offering the best solutions now.
- The first process is the application. Here, you need to apply for a home loan, which can either be done online or you can visit your nearby branch for details.
- After you have correctly submitted your application and once the review process is covered, the bank will sanction your loan amount. For that, they have to read your KYC documents and financial stability.
- When the loan gets sanctioned, you have to submit documents related to the property against which you got the loan. It works for legal and technical review.
- Upon validation of the amount and the property to cover, the bank will approve and then disburse the loan.
Conclusion
Now, you can avail some of the interesting and attractive rates with the home loans from chosen firms. Make the loan affordable and even easier on your pocket with multiple interest rates.