How to prepare for an Emi calculator…

Owning a home is one of the biggest dreams in individual’s house. But the loan is also considered as one of the biggest liabilities. Taking a loan is a wise financial decision but since it’s a long-term repayment procedure you need to be a bit careful about the interest rate applicable and principal amount, else it might make a big hole in your pockets. To catch the attention of the borrowers and to do great business, banks and finance companies come up with lucrative advertisements and financing offers.

While availing loans, obviously you have to pay interest rates based on floating or fixed basis. Banks and financial companies declare rates in every quarter based on various factors like availability of money in the market (liquidity), inflation and monetary policies. Often due to high interest rate charges and not so flexible repayment process you wish to switch the loans to another bank. If one wants to take advantage of the low interest rate regime and is not too happy with their existing lenders in terms of interest rates applicable and repayment options, he or she has the option of refinancing or opt for a balance transfer. 

So, here are some tips to consider while we opt for Emi calculator:

Generally, banks or finance companies keep talking about lower EMI’s and longer tenure. In case when you calculate the outflow and find that in the longer tenure you end up paying a higher loan amount then you should opt for the transfer option. Do online comparison and also talk to financial expert for better transfer deals. If your budget is not bootstrapped it is recommendable to stay up with the existing lender and pay off the loan as soon as possible.

There are some leading private sector banks and finance companies who offer home loan balance transfer at interest rates of around 9 to 10% to transfer your outstanding home loan availed from another bank / financial company. These loans come at attractive interest rates that make your home Loan affordable and easier on your pocket. They offer customized repayment options to suit your needs. The maximum rate for loan repayment is around 25-30 years, which means you have ample time to plan your finances well before. An Emi calculator proves beneficial when you have enough savings and time. Some factors to consider while choosing balance transfer is total costs, remaining loan tenure, outstanding principal, time and efforts.

Emi calculator makes sense during the early years of the loan and for a bigger outstanding amount, provided the difference in rate cut justifies the effort involved. Before approaching another banks or financial companies check with your existing bank if they are willing to revise the rates and retain you as a valued customer. Your processing fee, pre-payment charges and other rates matter a lot. Total savings can be determined after considering the total cost involved.