EMIs are made up of the principal and the interest portions. It is the whole amount that you pay every month till you repay the full loan. The EMI is generally fixed on the whole tenure of the loan. At the beginning of your loan, a major portion of your repayment would go to the interest portion. As you keep repaying the loan, a higher portion will be adjusted to the principal component of the loan.
If you prefer knowing the EMI you would be contributing each month towards an education loan before you apply for it, you can use the Educational loan EMI calculator.
What is an Education Loan EMI Calculator?
Groww's Education Loan EMI calculator is an online instrument that assists the loan-borrower with the calculation of the amount that they need to pay every month after borrowing an educational loan. It will give you an amortization schedule that shows you the EMI breakup in terms of monthly interest paid and the principal that has been repaid.
It will also detail the amount of loan that you have repaid to date and how much is yet outstanding. All of this will give you a fair idea of how much an educational loan is going to cost you by assisting you in calculating the total interest amount that needs to be paid over the whole loan tenure.
How Does the Education Loan Calculator Help You?
If you are or planning to apply for an educational loan, you will choose to know how much on a monthly basis you would be giving in to the EMI of the loan. When you know how much would be spent there, you can apply preferred interest rates and selected banks. Along with that, you could also plan your monthly budget.
Using the education loan EMI calculator will assist you with it, as it is simple to use, extremely fast, you can test different combinations, and it is completely free.
How to Use the Educational Loan EMI Calculator?
As already mentioned, this tool has been made 100% free and user-friendly, which means you will only have to enter the following details to get started.
Amount:This is the educational loan amount that you require, and you will have to update the loan amount by marking it on the calculator.
Tenure:This will be the information on how long you would prefer to extend or shorten the tenure of your loan. In simpler words, it is the time period that you will be paying your EMI. Also, another point to note is that the longer the tenure of your EMI - the lesser would be the EMI amount to you, and the shorter the time period - the higher your EMI would be.
Rate of Interest: Now, different banks offer different rates of interest - which means you will have to enter your preferred interest rate on a loan.
All of these data sets will give you the result of how much EMI you would be paying each month towards your loan. You can always edit these details and get a different set of EMI amounts that would suit your monthly budget.
How to Calculate the Educational Loans EMI?
Mentioned below is the formula and an example to show how educational loan EMI is calculated.
Formula:
This is the formula that is used to calculate the EMI of an educational loan.
EMI = [P*R*(1+R)^n]/[(1+R)^n-1]
P = The principal amount
R = The rate of interest
n = The tenure
Example:
Let us understand with an example how the educational loan EMI is calculated.
Mr Gokul borrows an educational loan of Rs. 10 lakhs with an average interest rate of 12% for a period of two years, and then the EMI would be:
P = 10 lakhs
R = 12/100/12 (converted to months)
N = 2 years
EMI = Rs. 46,073
Advantages of Using the Educational Loan EMI Calculator
These are some of the most crucial pros of utilizing the educational loan EMI calculator:
- The Educational loan EMI calculator will show you the EMI amount you would have to pay within seconds.
- You will get to see a clear picture of the EMIs that you will be paying every month.
- It will assist you in budgeting for the expenses and also saving for your financial goals.
- The amortization schedule shows you the education loan EMIs that you have already paid off.
- You will also gain an idea of the principal outstanding on the loan. This will help you manage your funds.
- You could also use this calculator from anywhere you wish, like, and all for free.
