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While planning to get a personal loan, it is extremely important to be clear with your requirements and needs so that you only borrow the amount which you really require and avoid any unnecessary burden on your finances. EMI calculator is a useful tool which you can use to plan your personal loan journey and be ahead of your loan repayments. Let us understand what an EMI calculator is and how you can use it effectively to avoid defaults in your repayments.
What is an EMI calculator and how to use it?
EMI calculator is a simple online tool that helps you to determine the EMI that you need to pay towards the loan amount within the repayment tenure. The calculator provides you with an accurate EMI based on the loan amount, interest rate, and tenure, where the interest rate does not change.
Using the EMI calculator is quite simple and quick. All you need to do is enter your loan amount, the interest rate and your preferred repayment tenure. With just one click, you can access a complete overview of your EMI repayment and how much money you will be bound to pay every month.
How to use an EMI calculator for avoiding loan defaults?
Your EMI repayment plays an important role in making sure that your credit score stays healthy. Even one default in repayment can deteriorate your credit score. Hence, in such cases an EMI calculator can be of great assistance as it can help in many ways. Let’s find out:
Effective planning:You can easily evaluate your repayment amounts and know how much you will be bound to repay every month from your pocket. With this, you will be able to have a better understanding and will be able to plan your funds in a better way to repay the EMI on time.
Deciding loan amount: Before you apply for a personal loan, you can use the EMI calculator and check the EMI amount so that you do not end up borrowing more than you can afford and avoid any defaults in payment.
Avoiding manual errors:With EMI calculators you can enjoy accurate results and have a clear estimate of your EMI amounts. This way you can eliminate the tedious way of calculating EMI manually which can also lead to calculation errors. Hence, you will be prepared for the amount you will be paying and have no last minute surprises.
In conclusion, EMI calculator makes it completely easy to calculate your EMIs and helps you to have a smooth loan repayment experience. It also helps you to compare different offers from lenders and assists you in making a wise decision.
Additionally, maintaining a good credit score is extremely important for your future borrowings and you must be consistent in making timely repayments to avoid any penalties. Hence, you must always plan your borrowing wisely with an EMI calculator and borrow only when you really require funds and stick to the amount you are in need of. This way you can stay clear of defaults and debt traps.
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