Education Loan EMI Calculator

Read on to know more about Education Loan EMI calculator in detail: 

What Is an Education Loan EMI Calculator?

An education loan EMI calculator is a digital financial instrument that helps the loan borrowers with the calculation of the amount that they need to pay monthly after borrowing an education loan. This shows you the breakdown as monthly paid interest and the principal that has been repaid. 

It also provides you with a detailed understanding of the loan amount that you have repaid till date and how much is unpaid yet. With this, you get an idea of how much an educational loan will cost you by computing the total amount of interest that needs to be paid over the complete tenure of the loan. 

The monthly EMI amount can be calculated based on three primary inputs: 

• Loan Amount

• Interest Rate

• Loan Tenure

Upon entering these details, the calculator instantly generates the expected EMI, along with the total interest payable and the overall repayment amount. This comprehensive output allows borrowers to fully assess the financial implications of the loan over its entire duration.

Benefits of Using an Education Loan EMI Calculator

Using an education loan EMI calculator provides you with many significant benefits.

Organised Financial Planning

If a person is aware of his/her EMI liabilities well in advance it is quite understandable that they can easily schedule their repayment in line with the inflow of their income thus maintaining a good financial situation.

Precision and Time Efficiency

The calculator produces precise results at the snap of a finger. It totally wipes out the source of errors that comes with manual calculation of figures, and at the same time it drastically cuts down the time needed for financial evaluation.

Comparative Evaluation of Loan Offers

By changing interest rates and loan tenures, the borrowers are able to make a thorough comparison of how different lenders would loan to them and pick the one whose terms match their financial goals most closely.

Avoidance of Financial Overload

Getting to know EMIs beforehand lessens the chance of taking a loan which requires such a high repayment that it is not bearable financially.

Clear and Detailed Cost Evaluation

The calculator depicts a cost breakdown of the interest thus instilling transparency and understanding of the entire financial commitment.

How to Use the Education Loan EMI Calculator? 

As mentioned, this tool is user-friendly and 100% free. You have to enter the below inputs: 

Amount: The education loan amount that you need and you will have to update the amount of loan. 

Loan tenure: How long you want to extend or shorten the loan term. Simply put, it is the time period that you will be paying your EMI.

Interest Rate: Different banks offer different interest rates which simply means you will have to enter your preferred loan interest rate. 

All these inputs give you the result of how much EMI you would be paying monthly towards your loan. It is always possible to edit these details and get a different EMI amounts that matches with your monthly budget. 

How to Calculate the Education Loans EMI? 

Educational loan EMI calculators use a simple financial formula to calculate the monthly payment:

Where,

P is the principal loan amount

R is the monthly rate of interest (obtained by dividing the annual rate of interest by 12)

N is the loan period in months

The formula may seem complicated but the calculator automatically does the whole calculation for you. You only need to enter the loan details to get the results right away.

Let’s understand this with the help of an example: 

Raj borrows a Rs. 20 Lakh education loan with an average rate of interest of 12% for tenure of 2 years, and then the EMI would be: 

P = 10 Lakhs 

R = 12/100/12 

N = 2 years 

EMI = Rs. 47,073

Factors Affecting Education Loan EMI Calculation 

There are several factors that influence the EMIs of an educational loan:

Several factors influence the monthly EMI of an education loan, including:

Loan Principal

The EMI increases proportionately with the size of the loan. Only take the loan upto the amount that you need for the purpose of education. 

Interest Rate

Interest rates can vary in decimals but can create a huge financial burden when aggregated. Loans with lower interest rates means you will have to pay less on top of the principal amount. 

Loan Tenure

Longer tenures reduce monthly EMI amounts but increase total interest costs, whereas shorter tenures have the opposite effect.

Moratorium Period

Most education loans include a moratorium period during the course duration and, in certain cases, beyond completion. Interest accrual during this period can influence subsequent EMI values.

How to Use an Education Loan EMI Calculator? 

The calculator may be used by following these steps:

Step 1: Enter the Total Loan Amount

Please give the amount that you wish to borrow as an education loan.

Step 2: Input the Relevant Interest Rate

Input the interest rate you have on your loan.

Step 3: Select the Loan Tenure

Decide how long you want to take to repay the loan. This can be either months or years.

Step 4: Start the Calculation

Press the button to do the calculation, and the details of the EMI will be shown.

The calculator will display:

• Monthly EMI amount

• Total interest payable

• Aggregate repayment amount

Adjustments to the input values allow borrowers to analyze different loan scenarios and repayment outcomes.

Other Calculators For EMI Calculation

• Home Loan Calculator

• Car loan EMI calculator 

• Personal loan EMI calculator 

• Business loan EMI calculator 

• Consumer loan EMI calculator

Summing Up

An Education Loan EMI Calculator is a useful tool for travel planning from a personal finance angle. It brings clarity, accuracy, and transparency to the evaluation of education loan liabilities. By giving borrowers the opportunity to check their affordability and view their repayment schedule for the long term even before taking the loan, the calculator helps in making well, informed, wise, and financially responsible borrowing decisions. Loan seekers should definitely consider using an EMI calculator before going through the process of obtaining an education loan.

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