EMI Calculator

What is an EMI ?

An EMI (Equated Monthly Installment) is the fixed monthly payment you make to a lender to repay the loan you've taken. This payment consists of two parts: one portion covers the interest on the loan, while the other reduces the principal amount you borrowed.

In the early stages of the loan, a larger share of your EMI goes toward paying the interest, and the remaining amount goes toward reducing the principal. Over time, as you continue making payments, the interest portion gradually decreases, while the principal portion increases. The exact distribution of principal and interest depends on the interest rate of your loan. Although the total EMI remains the same throughout the loan tenure, the breakdown between interest and principal changes with each installment. This structure helps you pay off both the interest and the loan amount systematically, ensuring full repayment by the end of the loan term.

What is an EMI Calculator ?

An EMI calculator is an online financial tool that helps borrowers estimate the monthly payments required to repay a loan. By entering key details such as the loan amount, interest rate, and loan term, the calculator quickly computes the Equated Monthly Installment (EMI). This tool not only shows the EMI amount but also provides a breakdown of the total loan repayment, including both the principal and interest portions over the loan tenure.

EMI calculators are used for various types of loans, including home loans, car loans, personal loans, student loans, and consumer durable loans, among others. They offer a quick and easy way to determine how much you will need to pay monthly, helping borrowers plan their finances effectively. Additionally, the calculator allows users to compare different loan options, understand the overall cost of the loan, and manage their monthly budgets accordingly. Whether you're taking out a home loan, auto loan, or any other type of credit, the EMI calculator is a useful tool for making informed financial decisions.

How do EMI Calculators work ?

You can calculate your EMI (Equated Monthly Installment) using the following formula:

EMI = P × r × (1 + r)^n / [(1 + r)^(n - 1)]

Where:

P is the loan principal (the amount you borrow),

r is the monthly interest rate (if the annual rate is 12%, the monthly rate is 1%, which is 12% ÷ 12),

n is the total number of months in the loan term.

Example:

Let’s say, you have taken a loan of Rs. 10 Lakh at 12% for 10 years. In this case, P will be Rs. 10 lakh, r will be 1% (12% / 12), and n will be 120 (10 x 12).

Let’s put these values in the formula: 10,00,000 x 1% x (1+1%)^120 / [(1+1%) ^ (120-1)].

After solving the equation, you will get Rs. 27,027.78, your monthly EMI. Hence, in 10 years, you will pay Rs. 17,21,650.80. The total interest you will pay over the 10 years will be Rs. 7,21,650.80

How to use EMI Calculator of GMI Capitals

EMI Calculator is a simple tool designed to help you calculate your monthly loan payment. To use it on GMI Capitals, you need to enter three key details: the loan amount, the interest rate, and the loan tenure.

• First, input the amount you wish to borrow.

• Then, provide the interest rate at which the lender is offering the loan.

• Lastly, specify the duration over which you want to repay the loan, either in months or years, depending on your preference.

Once all the information is entered, the calculator will instantly compute your monthly EMI (Equated Monthly Installment) along with the total interest payable over the course of the loan. Additionally, it will provide a detailed amortization schedule, breaking down each monthly payment into the portions that go toward the principal and the interest.

Advantages of using GMI Capitals EMI Calculator

1) It provides a clear breakdown and helps us to determine the repayment tenure wisely.

2) It helps us in budget alignment and to decide that what fits us.

3) It gives us an opportunity to increase our credit score.