A housing loan is an effective financial tool that can help you become a homeowner easily. With the RBI reducing the repo rate to 4%, now is the best time to invest in, or buy a home, as the current home loan interest rate is at an all-time low. However, a housing loan is a long-term financial responsibility that can have lasting effects on your personal financial holdings if you do not manage its repayment properly.

The first step towards effectively managing the timely repayment of the loan is to ensure that you borrow a loan amount in line with your repayment capabilities. This entails, choosing an EMI amount that you can easily pay in a disciplined and timely manner without straining your finances. While, manually calculating your EMI amount is possible, the process is extremely tedious. Moreover, considering the seriousness of the decision, even a slight calculation error can have a detrimental effect on your finances. So, it may be a smarter move to calculate home loan EMI online, using a home loan EMI calculator.

Here’s how you can calculate home loan EMI using this tool.

## Formula to calculate home loan EMI

The EMI amount depends on the loan amount or principal amount, the rate of interest and the repayment duration of a housing loan. Considering these components, you can calculate home loan EMI using the following formula.

EMI = [P x R x (1+R)^N]/[(1+R)^N-1]

Where P is the principal

R is the rate of interest

N is the repayment tenor of the loan in months

For instance, if P = Rs.20 lakh, R = 12% and N = 240 months, then your EMI outgo every month will be Rs.22,022. You can calculate home loan EMI in an instant, without any hassle, and most importantly, without any risk of error, using a home loan EMI calculator in just three simple steps.

## How to use a home loan EMI calculator

Once you have found an EMI calculator online, all you need to do is enter your desired loan amount, repayment tenor and rate of interest in the calculator. Within seconds, the calculator displays not only your EMI amount, but also your total interest payable and the total cost of the loan, that is, principal and interest together. This helps you assess your finances and the cost of borrowing with ease.

For instance, use the Bajaj Housing Finance Limited Home Loan EMI Calculator by entering the values on the right or by using the slider. Say, you opt for a home loan amount of Rs.50 lakh with a repayment tenor of 20 years at an 8.35% rate of interest. Your total EMI and interest amounts will be as follows.

EMI per month: Rs. 42,918

Total interest payable: Rs. 53,00,081

Total amount payable: Rs. 1,03,00,081

Knowing these details, you can plan your finances throughout the repayment tenor. You can also tweak these details. For instance, you can increase your tenor from 20 years to 25 years. Here are the new figures in this case.

EMI per month: Rs. 39,757

Total interest payable: Rs. 69,27,294

Total amount payable: Rs. 1,19,27,294

As you can see, a longer tenor reduces your EMI, but costs more in the long term; however, this may be the right move for you given your finances. In a similar way, you can calculate home loan EMI as many times you need using the digital calculator and make a more informed decision.

## Advantages of using a home loan EMI calculator

Using a home loan EMI calculator has the following benefits:

• You can easily compare housing loan offerings from multiple lenders with different rates of interest and choose the best one that suits your needs.
• Since a home loan EMI calculator gives you your exact EMI outgo, you can easily plan and manage your monthly expenses in advance.
• The calculator is widely available and easy to use, ensuring that you can easily calculate your EMI and choose the appropriate loan offer as per your repayment capacity, even on the go.
• Finally, the calculator allows you to make better decisions regarding the home loan amount and tenor based on your income.

Now that you know how to calculate home loan EMI, you can work on getting a home loan on a competitive rate of interest with value-added features to make borrowing more convenient.

One of the assured ways to get a nominal home loan interest rate starting from just 6.75% and on transparent terms is by availing of the Bajaj Housing Finance Home Loan. With this offering, you can access a high sanction repayable over a long and flexible tenor of up to 30 years. Moreover, with its fast processing timeline, minimal documentation requirements, and simple eligibility criteria, you can make your dream of owning a home a reality with ease. To get started, use the home loan eligibility calculator to check if you qualify, and apply online today!

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