The concept of prepayment of home loans can be defined as the process, wherein borrowers repay the entire or a portion of the outstanding loan amount at one go. Consequently, such repayments are made before the scheduled date of the EMI payment. A home loan prepayment calculator works on this particular concept and helps plan the process of prepayment of home loans more systematically. Also, it helps in calculating the foreclosure amount accurately.
Since prepayment of home loans helps borrowers lower their EMI burden and loan tenor, the prepayment calculator tends to play a role in the same.
To begin with, it helps borrowers figure how much they would be able to save by reducing their existing tenor. Also, by referring to the amortization table that accompanies this home loan prepayment calculator, they would be able to figure their savings effectively. Nevertheless, intending users must be aware of the steps involved to use this financial tool correctly.
Step 2 – Enter your slated tenor.
Step 3 – Input the prevailing rate of interest.
Step 4 – Add the number of EMIs that has been already paid.
Step 5 – Select the month when you wish to foreclose the loan.
Subsequently, by following these steps, individuals would learn how much they have to pay to foreclose their home loan. In turn, it would help them streamline the process better.
Role of home loan calculator in savings
Since prepayment of home loans helps borrowers lower their EMI burden and loan tenor, the prepayment calculator tends to play a role in the same.
To begin with, it helps borrowers figure how much they would be able to save by reducing their existing tenor. Also, by referring to the amortization table that accompanies this home loan prepayment calculator, they would be able to figure their savings effectively. Nevertheless, intending users must be aware of the steps involved to use this financial tool correctly.
Steps to using a home loan prepayment calculator
Step 1 – Input your loan amount.Step 2 – Enter your slated tenor.
Step 3 – Input the prevailing rate of interest.
Step 4 – Add the number of EMIs that has been already paid.
Step 5 – Select the month when you wish to foreclose the loan.
Subsequently, by following these steps, individuals would learn how much they have to pay to foreclose their home loan. In turn, it would help them streamline the process better.
Further, it would also help plan their finances effectively. Hence, by using this financial tool, you would be able to save significantly on your prepayment of home loans.
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