Loan Amount Affordability Calculator
Loan amount calculator is other known as the loan affordability calculator which helps one to understand before taking a loan about his or her affordability to take and pay it. It becomes important for everyone of us to first calculate the loan before buying your dream car or a house. There is online calculator which will help one to understand whether they can afford to take a particular amount of loan and the ability to repay based on their income what they earn every month.
One takes different types of loans like house loans, car loans, personal loans, educational loan etc., and while taking it is important to understand how much would be the EMI we need to pay every month. This will also help us to prepare the monthly budget.
Here is a simple example to understand how much a person can get a loan amount based on the EMI affordability.
Example: Let us assume if person can afford to pay an EMI of Rs 10,000 for a period of 5 years at an interest rate of 15% then the total amount payable to the bank at the end of 5 years will be Rs 6,00,000 (10000*5*12), then the loan amount he/she is eligible can be determined as follows;
Affordable EMI x Months = Total Payable – Interest Payable = Eligible Loan Amount
10000 x 60 = 600000 – 179655 = 420345
|Affordable EMI||Interest Rate||Loan Tenure||Total Payable||Interest Payable||Eligible Loan Amount|
|10000||15%||5 Years / 60 Months||600000||179655||420345|
This loan amount differs based on the affordability of each person; more the EMI one can pay more will be the loan amount he/she can avail.
Different banks charges slightly different interest rates for the same loan, hence before deciding on which bank to go for and other factors you can simply use the online calculator, determine the loan amount and then make a decision.
The Loan amount can also be calculated manually but it is better always to go for online calculators as it is very easier to calculate without making an error when compared to calculating it manually.