A home gives you a permanent shelter, wherein you can stay and have fun with your family members. However, there is a cost associated with such luxury. And that too, in sums of lakhs to crores. For some, taking out a huge chunk in one go may not be a big deal. But for most, it may not be the same. And so, they need to avail a home loan and repay it in easy installments.
As the loan goes for as long as 20-30 years, you should choose a lender offering an attractive rate of interest and have an excellent customer servicing track record. One such lender which has stood to these points is Housing Development Financial Corporation (HDFC), a prominent mortgage firm in India. The amount of installment and the extent of interest outgo will be decided by HDFC Home Loan EMI Calculator. So, come and check out its function, as well as other details.
HDFC Home Loan Interest Rate
HDFC home loan interest rates range from 8.35%-8.95% per annum. With such affordable rates, both EMI and the interest outgo can reduce substantially, resulting in enhanced savings for the borrowers. As you see a range of interest rate above, it would be good to transact a home loan deal with HDFC at a rate closer to the lower limit of 8.35%, if not 8.35% per annum. Well, you can be successful doing so provided you have a good CIBIL score, healthy income, etc. Let’s read the importance of these factors in grabbing an affordable interest rate deal.
A good CIBIL score is a prerequisite for getting a loan at an affordable rate of interest. Normally, the score ranges between 300 and 900 in India. For a home loan to be approved hassle-free and at a lower rate, it is imperative to have a score above 750. The CIBIL score results from the way one services the debt, if availed in the past or is availing. While a timely repayment increases your CIBIL score, the delay or default decreases the same. If you’re servicing a debt, make sure to repay on time to sit among the top CIBIL scorers.
A good income is a gateway to grabbing an attractive interest rate offer as it instills a impression among the lenders like HDFC about your strong repayment capability. That impression often translates into a reduction in the interest rates.
What is the Significance of Loan Amount in EMI and Interest Calculation?
The extent of finance is a key in deciding the shape of repayment and the cost associated with the same. So a greater amount of loan would have a comparatively higher EMI and vice-versa. On the other side, the tenure shares an inverse relationship with an EMI. A longer loan tenure leads to a lower amount of EMI compared to a shorter period of credit. But there is a catch here to unfold. You may get away with a lower EMI opting for a longer tenure. But the interest outgo over the course of such tenure is likely to be much higher than what you could think of. So, it is advisable to opt for a comparatively shorter tenure to curtail the outflow of interest.
It’s Time to Calculate EMI on Your HDFC Home Loan
Now as you know the importance of loan amount, interest rate and tenure in the EMI calculation, it’s time to compute the installments taking these three variables into account. So take a help of the EMI calculator which is available online. Just enter the variables to get the indicative installment as well as the overall interest outgo on your screen. You can also calculate the EMI using the below formula.
E = P . R . (1+R)^N/((1+R)^N – 1),
Where E = EMI
P = Loan Amount
R = Interest Rate
N = Monthly Loan Tenure
Now that you have understood the function of HDFC Home Loan EMI Calculator, you are in a position to take a right call on your home loan. Do glance at the calculator to compute the installments in advance. This will help you choose a property of your budget.