Personal loan interest rates differ for different lenders. Although personal loan is an unsecured loan and therefore has a higher rate of interest compared to other traditional loans, it is also a loan in which lenders often charge interest rates based on borrowers monthly income and loan tenure.
Are there any Other Charges Apart From Interest Rates?
Though the charges vary from bank to bank, the general fees are:
- Some processing fees
- Bounce charges on EMI
- Penal interest rate
- Secure fee for online applications
- Pre-payment penalties charged by some lenders, not all
How do I Repay the Personal Loan?
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Personal loan is repaid in the form of Equated monthly installments (EMIs). It has two components: (a) part of the principal amount and (b) interest on the principal. Simply put, EMI is the sum of the principal amount and interest on the principal divided by the tenure of the loan (in months). Most lenders provide EMI calculators in their websites.
How does a Personal Loan Emi Calculator Work?
- Your EMI calculation depends on three things:
- The principal amount i.e., the loan amount.
- The rate of interest that is applicable to you.
- The total term of the loan i.e., the time period for which you are taking the loan.
Based on these three factors, your EMI is calculated. Some lenders also provide a month on month breakdown of the EMI for the entire loan tenor.
The personal loan EMI calculator will indicate your monthly payment based on which you can apply and get approved for the loan.
Most lenders have nil foreclosure and pre-payment charges which helps reducing your EMI or pay the loan in full whenever you can. Flexibility to use funds for any purpose, minimum paper work and quick approvals make this a very attractive loan. So do not wait any longer and fulfill your personal needs.
Author Bio:- Arwind Sharma is a financial advisor with an experience of more than 7 years. He has worked for topmost financial firms in India and has been a visiting faculty at many reputed institutes in India. Currently based in Pune, Arwind Sharma is a name to reckon with when it comes to financial management for big brands. A post-graduate in business economics, he is an alumni of Princeton University, USA. During his free time, Arwind teaches children from marginalised sections of society and also work on his blog