How does an education loan EMI calculator function?

Education is an essential asset for every individual. It helps them achieve their goals with all facilities and benefits earned on their merit. They can gain lots of knowledge about the world and make a bright future. They learn to become civilized and smart. They also take all decisions on their own and solve all their issues tactfully.

Taking an education loan requires lots of commitments, mainly timely repayment of the loan. They can use an education loan EMI calculator to check the amount they have to pay towards it every month. It saves lots of time and gives the exact results which help loan borrowers make the right decision. They have to provide detailed information about their loan to get the total interest payable along with the repayment amount. Enter parameters like the loan amount, interest rate, and loan tenure to get results within seconds.

The parameters of the calculator

The education loan interest rate calculator includes some parameters to calculate the exact loan amount. They can find these online as well. Using these is better than manual calculations because there are minimal chances of errors, and it saves lots of time.

Following are the parameters for calculation:

Loan amount: The most important factor for calculating EMIs is the loan amount. The monthly installment of the loan is dependent on the loan amount that varies from lender to lender. It is calculated based on the eligibility of the loan borrower.

Loan interest rate: The interest rate charged on the borrowed money is the base of the EMIs. Higher the interest more will be the EMIs and, if the prices are low, then the monthly installments reduce, hence lessening the burden on the pocket.

Loan tenure: The longer the mandate, the easier it becomes to repay the fund. For an education loan, lenders offer 15 years.

An EMI is an abbreviation for Equated Monthly Installment. The loan borrower pays this fixed amount every month to repay the entire loan amount and the applicable interest. The EMI amount consists of two parts, namely the relevant interest and the principal amount. The ratio of each keeps varying as the borrower progresses along with the loan tenure. It is very simple to use an education loan interest calculator to calculate all monthly payments. However, loan applicants can also manually calculate the EMI using the following formula:

EMI = [P x R x (1 + R) ^ n] / [(1 + R) ^ n – 1]

P = The principal loan amount

R = The applicable rate of interest

N = Number of installments (or the loan tenure, in months)

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