How EMI calculators help you repay your loans on time and improve your credit score
Nowadays, almost every person’s monthly balance sheet reflects a long list of expenses which includes a considerable number of EMIs. The ever-helping facilities of banks and other financial institutions allow the customers to fulfill their needs easily. Various types of loans and credit cards are available in the market which is heavily used by people given the security and reliance that these facilities come with. The only thing that bothers all of everybody is managing the EMI payments. This is a task that becomes stressful and tiring in the long run as calculations are complex and time-consuming. For this purpose, you can use an EMI calculator that is easily available online free of cost. To know more, read the details mentioned below that would help you understand how these calculators can not only help you in repaying your loans but can also improve your credit score.
What Is An EMI Calculator?
An EMI calculator is an online facility provided by many companies that offer financial services that can be used free of cost by the consumers. All you need to do is access the calculator through the online portal of any company that provides this service and in a matter of a few minutes you can get your job done. The details you need to provide includes variables like the principal amount, interest rate, type of loan, and the exact tenure. There are many types of EMI calculators such as:
- Personal Loan EMI Calculator
- Car Loan EMI calculator
- Home Loan EMI calculator
- Education Loan EMI calculator
So depending upon the type of your loan, you can use any of these calculators to do the complex calculations easily.
How Is It Used?
You can use an EMI calculator by following these few simple steps:
- Visit the website of any EMI calculator provider and click on the “use calculator” tab.
- Enter the details required like loan amount, loan type, loan period, and interest rate.
- Click enter or “calculate” tab.
Once done, the screen will display the results which include EMI payable, total interest payable and total amount payable. An EMI calculator is as easy as this to use.
How Does It Work?
The loan EMI calculator works based on the given formula:
EMI = P * (r*(1+r)n)/((1+r)n-1) where,
P stands for the principal amount, R stands for interest rate and ‘n’ stands for the tenure.
How Can It Help In Improving Your Credit Score?
Every loan bearer and credit cardholders are well aware of the significance of a good credit score. For availing any form of credit from banks or other financial entities, one needs to possess a good credit score which is used to assess the credibility and loan repayment ability of a borrower. Therefore, it is very important for you to maintain your credit score as the higher it is the better will be your chances of availing loans and credit cards. An EMI calculator helps you in calculating your EMIs efficiently which in turn assures accurate payments. Also, by using this calculator you can plan your future expenses and make sure that your payments are not missed or bounced. This way your credit score is not hampered and you can build a stronghold in your financial payment records.
Regular and accurate repayment of EMIs is very important for every borrower in order to maintain a good credit score as well as avoiding penalties or fines for late payments. Not every one of us is comfortable with the complex mathematical calculation of EMIs and therefore, it is better to use an EMI calculator for accurate results. The benefits of it can be availed free of cost and at the convenience of your smartphones or computers.