Taking a small personal loan is becoming an extremely popular choice among today’s professionals to fund expenses like medical expenses, vacation costs, home renovation, wedding costs, and other urgent financial obligations. There are a lot of financial institutions in the market today like Bajaj Finserv that offer collateral free personal loans for amounts up to Rs. 25 lakhs depending upon your eligibility. You can use a personal loan calculator to determine your personal loan eligibility and choose a loan amount and tenure that suits your requirements the best.
A personal loan calculator allows you the flexibility of choosing your desired loan amount, along with increasing the chances of getting your small personal loan approved by helping you calculate the monthly EMIs and loan tenure that suits your budget the best. You can learn more about the formula a personal loan calculator works on below:
EMI = P * R * (1+R)n/[(1+R)n-1]
In this formula:
P = Principal loan amount
R = rate of interest calculated on monthly basis
n = loan duration in months
So, if you want to take a personal loan of Rs.4 lakh for a duration of 24 months at 12% interest rate per month, your EMI would be:
EMI = 4,00,000*12*(1+12)24/[(1+12)24-1] = Rs.18,829
In order to increase the chances of getting your loan application approved, make sure that you choose a small personal loan amount and tenure where your monthly EMI is less than 50% of your monthly salary and you have enough money left to pay the EMIs after covering your other expenses.
Now that you know how to use a personal loan calculator to calculate the EMIs or monthly installments on your small personal loan, you can increase the chances of getting your loan application approved and get a collateral free loan.