Planning to Take a Personal Loan? Strike a Balance Between EMI and Tenor

When you apply for a personal loan, deciding on a sound repayment strategy becomes one of the most important things to plan for. Apart from looking for a hefty sanction on nominal interest rates, finding the right balance between the tenor and EMI will help keep the debt within your budget. Additionally, you will be able to reduce your overall borrowing cost by operating within a prudent loan structure. 

Read on to know how you can find the correct balance between EMI and tenor when you borrow a personal loan. 

Step 1: Use the Personal Loan Eligibility Checker to Qualify for a Low-Interest Loan 

The personal loan eligibility calculator determines the loan amount you can avail basis your financial profile. You can then use this amount to calculate your total outgo, as per a suitable tenor, and check to see if it matches with your repayment capabilities. Besides granting insight into the sanction, the personal loan eligibility checker plays an invaluable role in helping you identify a viable offering as well. 

Step 2: Budget Your Income and Expenditure to Know How Much EMI You Can Pay 

The next step is to account for your current financial standing. This will give you a clear picture of how much you can allot to EMI payments without cutting down your other commitments. Finding the appropriate amount is important because choosing an installment that is either too high or too low has its pitfalls. With a high EMI, you stand a higher chance of defaulting in case you've faced an emergency of any kind. Alternatively, if you opt for a long tenor and lower EMIs, your interest outgo increases along with the overall cost of borrowing. So, determine your current disposable income accurately to best cater to your capabilities and get the maximum benefit from your finances. 

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Step 3: Use the Personal Loan EMI Calculator to Decide a Suitable Tenor 

A personal loan EMI calculator is an online tool that helps determine the EMIs you are to pay. It is easy to access and even simpler to use as it only requires you to enter details for 3 main fields. After which, it will automatically compute your loan EMI, total interest payable, and the total payment for the loan. The calculator also helps you find the EMI for various tenors and interest rates against your principal loan amount and you can do this in just a few clicks by altering the figures for each. All you have to do is fill in the boxes with the respective values, and find the corresponding EMIs. The next step then is to compare the various EMIs and tenors until you find a balance that allows you to save on your interest without burning a hole in your pocket. 

Must Read: Top Rules to Remember When Opting for a Personal Loan in India

Step 4: Consider Future Earning and Finalize Your EMI and Tenor 

Another important part of planning is to consider future earnings that you may gain access to over and above your stipulated income. This can be in the form of a payment that is due to you such as rental income or payment via the sale of an asset or even via other earning options such as a maturing investment. In such situations, you can compromise on luxuries for a short duration and pay a higher EMI to keep your interest obligation low. However, evaluate the extra income and its sources well in advance and hike your EMIs only when you are sure of the payment. 

Once you have decided the loan tenor and the EMI you are going to pay per month, you can approach the lending institution you are willing to borrow from. With a Bajaj Finserv Personal Loan, you enjoy a sizable sanction of up to Rs.25 lakh at one of the lowest interest rates available in the Indian market. You can also avail quick disbursement of funds with facilities like instant approval, minimal documentation, and money in your account in 24 hours. Enjoy an expedited application procedure by applying for this loan online. All you have to do is check your bajaj finserv pre-approved personal loan online to access a customized deal and enjoy a hassle-free personal loan application.

Must Read: Why Personal Loan is Immensely Popular in India