A Step-By-Step Guide to Using a Mortgage Loan EMI Calculator - Loan Trivia


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Tuesday 23 April 2024

A Step-By-Step Guide to Using a Mortgage Loan EMI Calculator

Earlier, it was way too difficult to find a loan product that fits one’s budget as well as meets their aspirations. But now various secured financing instruments have made everyone’s borrowing journey a lot smoother. 

Through this article, the readers will understand how to properly use online calculators for determining their mortgage loan EMIs. Also, they can get an idea about loan against property eligibility criteria to help them pick the right loan offer and reduce the chances of rejection.

Steps to use a loan against property eligibility calculator

Various common factors like a loan applicant’s age, income profile, occupation, property type and credit score determine their loan against property eligibility

So, one can follow these steps to check mortgage loan eligibility now:

Step 1: Visit the preferred lender’s website to access the loan against the property EMI calculator.

Step 2: Mention the ‘Employment Type’. 

Step 3: Provide an accurate estimate of the monthly obligations. 

Step 4: Enter the property value against which the loan shall be disbursed. 

After all the steps are executed, the maximum approvable amount for the loan is displayed on the screen. One can now proceed to the next step by clicking on 'Apply Now'. 

Benefits of using a loan against property calculator

There’s an age-old method of correctly calculating loan EMIs using the following formula:

EMI amount = [P x R x (1+R) ^N]/ [(1+R) ^N-1]

In the above expression, P stands for the borrower’s principal amount while R and N denote the loan interest and tenor respectively. 

Although anyone can use this equation to find out the payable instalments, there's no denying the fact that it may lead to errors. As a result, a wiser option would be to adopt an online EMI calculator that ensures:

  • Faster calculation

  • Time-saving 

  • Accurate output

  • Additional loan insights

The best part is these tools are free to use without any set daily usage limit. Once an applicant has finalised the loan amount, they need to collect the necessary documents before beginning the application process. 

Documents required for loan against property

The documentation needs vary for both salaried and self-employed individuals.

For instance, for salaried people, the lender asks for these documents:

  • A copy of residential proof (Ration card/ electricity bill/ voter’s ID card, etc.)

  • A copy of ID proof document (Aadhaar card/ employer’s card/ voter’s ID card)

  • Passbook/ bank statement copy for the previous 6 months

  • Form 16 for the previous 2 years

  • Salary slip of the past 6 months

  • Copy of the property papers that the individual wishes to put forward as collateral

On the other hand, for self-employed individuals, the documentation needs to appear somehow like this:

  • A copy of residential proof (Ration card/ electricity bill/ voter’s ID card, etc.)

  • Bank statement of the past 6 months showing a regular source of income

  • ID proof document (Aadhaar card/ employer’s card/ voter’s ID card)

  • Copy of the documents establishing the fact that the borrower is the owner of the concerned property

Once an individual has managed to arrange all these documents they may proceed forward to fill out the loan application form. 

These days, lenders provide pre-approved offers to their existing borrowers on selected financial products like loans against property, and home loans, depending on their credibility. One can accept these offers to speed up their loan approval process. Individuals can check their pre-approved offers online by entering their name and contact details on the lender's website.

The first focus of borrowers should be to check loan against property eligibility criteria as well as their monthly instalments using an EMI calculator. Otherwise, a loan rejection will bring detrimental effects to their credit profile. Such instances can lead to much higher interest later on along with a lowering in CIBIL score. 

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