Owning a home is a dream come true for many of us. Socially and culturally too, we consider owning a home as a symbol of being successful. Whatever be the reason, owning a home brings in lots of joy and also with it, comes the hassles of a getting a home loan. When going in for a home loan, there are a lot of factors to be considered like your eligibility, the down payment amount required, tenure of the loan, interest rate, the EMIs and of course your credit score.
Do the above-mentioned terms sound daunting to you? Don't know how to find much would be the EMI for buying that lovely apartment close to your office or how much down payment can you manage? Hundreds of questions hover on the minds of those looking for a home loan.
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Home loan calculators work like a charm for finding out answers to many of those questions easily.
What are home loan calculators?
Home loan calculators are simple tools available on most of the websites of home loan lenders. It helps you calculate the Equated Monthly Installments amount payable on the amount you are looking to borrow. These calculators help you evaluate the possibilities of varying your down payment and loan amount so that you know how much is payable. Even before you land up at the bank with your application for a loan, it is good to use these calculators to know how much would a loan set you back by just by using 3 factors
Rate of interest
Advantages of a home loan calculator:
Shows segregated amounts for interest and principal
A home loan calculator also shows your interest and principal amount separately. As principal paid towards home is admissible under Sec 80 C of Income Tax as a deduction and the amount of interest paid is admissible under Section 24. With this calculator, it is easy to assess the number of benefits you will reap in form of tax cuts with a home loan.
Additional Reading: Claiming Home Loan Interest as a Tax Deduction
Allows you to change parameters
A home loan calculator allows you to change parameters like the interest rate, amount or the interest rate. It helps you to calculate your outgo in the form of EMI under different scenarios. Home loan calculators on certain websites also let you put in your figures for down payment too.
Helpful even after the loan is disbursed
Home loan calculators also help in ascertaining the amortization schedule after the loan has been disbursed. This is helpful if you want to prepay the loan. It assists you in determining the amount of outstanding principal.
Additional Reading: How to Calculate Home Loan EMI?
Certain websites also feature enhanced calculators like Eligibility Calculators, Length Conversion Calculators or Affordability Calculators. These calculators help you toy around with more number of parameters and help you arrive at a sound decision of the ideal amount and ideal tenure.
Make an informed decision by making your calculations beforehand using a home calculator.