If
anytime there is a requirement for finances, you can always apply for a loan.
However, at the same time, you will be required to pay back the borrowed funds,
along with an added interest. This can be done through equated monthly installments.
Also
known as EMI, it is a fixed amount a borrower will pay to repay the loan. This
amount is paid at a particular date until the loan tenure is met. This EMI’s
comprises of an amount that includes the interest as well as the principal
amount. You can even use the EMI calculator to get the required amount that
will suit your needs while repaying the loan.
As
mentioned previously, EMI’s will be made every month as part of the repayment
process of a loan. This EMI amount constitutes of a principal amount along with
a certain rate of interest. This rate of interest depends on the amount that is
borrowed, the tenure of the amount and the lender. Throughout this tenure, the
principal component is less than the interest component, especially in the
initial period of repayment. Over the tenure, the rate of the interest will
decrease gradually whereas the principal amount will increase.
EMI
is fixed payments made every month as a part of loan repayment or a purchase.
EMI constitutes of the principal amount to be paid and a certain rate of
interest. The rate of interest depends on the amount borrowed, the duration for
which it is borrowed and the lender. The principal component is lesser than the
interest component in the initial period of repayment and the rate of interest
will decrease gradually and the principal amount will increase over the period
of repayment. But how can you benefit from this form of repayment?
In
reality, EMI’s are a convenience to those who depend on a steady source of
income, especially if they are capable of paying a fixed amount. This makes it
easier in terms of affordability, as it provides a choice of purchase for many
items that require a lump sum payment. Additionally, it also provides a means
of flexibility. Through this form of payment, you can easily decide the amount
you will need to pay in installments especially with the assistance of EMI
calculator. Keeping in mind your financial situation and income; you can easily
calculate the amount that will suit your requirements. Additionally, EMI’s are
completely easy on your finances, as it allows you to make minimal payments
every month rather than large amounts which are not affordable. One of the best
parts of EMI’s is that you need not submit it through a middleman or any
intermediate sources. The amount gets deducted directly from your account on
the required date.
