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In this guide, you can find all that you need to know about SBI loan repayments - how it works, how to pay the borrowed amount, amortisation schedule, terms and conditions and much more.
A loan is any money borrowed by an individual or another party. The lender — usually a company, financial institution, or government — provides the borrower with a sum of money. In return, the borrower agrees to a series of terms covering all financial costs, interest, maturity dates and other terms and conditions. In certain situations, the lender may often require collateral to protect the loan and ensure its repayment.
Loan terms are concurred by each party before any amount is lent. A debt may be backed by equity, such as a mortgage, or it may be unsecured, such as a personal loan. Revolving loans or lines of credit can be lent, spent and repaid, while fixed-rate, fixed-payment loans are fixed-term loans.
A loan is a type of borrowing by other individuals, organizations, etc. from one or more persons, associations or other institutions. The recipient incurs a mortgage and is generally obliged to pay interest on the loan before it is settled and to repay the principal amount borrowed. Loans are of many kinds, such as residential loans, auto loans, personal loans, student loans, corporate loans, and many more.
About SBI Loan Repayment
Loan repayment is how the borrower returns the borrowed money back to the lender. The amount of the loan is refunded in corresponding monthly instalments called the EMI, which consists of the interest component and the principal component.
The sum of the EMI, together with the interest and principal break-up, is given in a schedule called the Amortization Schedule. This table shows the exact amount of interest and principal that is deducted from your loan amount for each EMI you pay.
The Amortization Schedule is a table showing each instalment that is due, normally on a monthly basis, and the amount of the instalment is assigned to the interest as opposed to the principle. Amortization tables may allow the borrower to monitor what they owe and when the next instalment is expected, as well as to work out the total outstanding principal or interest on the loan.
Loan repayments are usually rendered by monthly EMIs. Occasionally, there is also a possibility of a Bullet Repayment. Repayment plans are primarily dependent on the type of debt, the amount of the loan, the interest rate, the preferred term and the ability of the borrower to repay. Let 's look at the two most common forms of repayments available for various types of loans;
EMIs – EMIs or Equated Monthly Instalments are the most common form of payment plans offered for any form of loan. In this form of repayment, the principal value of the debt plus the total interest is split into equivalent monthly payments for the term of the loan. This sum is called the EMI and is payable per month by the creditor on a set date. As the number of EMIs continues to be paid, the interest rate and the principal amount will be reduced accordingly from the amount of the debt until the full amount of the loan is repaid. The loan is then officially ended.
With EMI repayments, consumers are better able to handle their monthly finances. They're also expected to prepare for other costs accordingly. Banks also offer 'Part prepayments' and 'Full pre-closures' on your loans, which allow you to use the bulk of the sum you may receive during the loan repayment period.
Bullet Repayment- Some loan products will help you to repay the loan via a bullet loan repayment mechanism. You just need to pay the interest portion each month in this option. When the term of this loan expires, you have to repay the whole principal loan in one go.
SBI Bank Home Loan Repayment
SBI Bank Personal Loan Repayment
SBI Bank Auto Loan Repayment
SBI Auto Loans can be utilized to purchase new or used cars, multi-utility vehicles and SUVs.
SBI Bank Education Loan Repayment
SBI Bank Education Loans offer affordable loans for all your higher education needs. They offer one of the best interest rates in the market.
SBI Bank Gold Loan Repayment
SBI Bank offers gold loans of up to Rs.50 lakhs to meet all your needs.
SBI Bank Loans Repayment Calculators
Repayment calculators are an important tool you should utilize before opting a loan. Repayment calculators allow you to plan the loan amount and EMI schedule wisely.
SBI website offers quite a few types of calculators for your benefit;
The CreditMantri website has EMI calculators for different types of loans. You can find them through this path – Home > Community > Finance Calculators.
Once you have chosen the desired calculator, you can enter different values in the loan amount, loan tenure and Rate of Interest fields to calculate the respective EMI amount (monthly), total interest payable and the total repayment amount.
This will give you a clear idea if you can afford the loan. If needed, you can pool in additional down payment or submit additional security or collateral to get better loan terms.
1. What happens if my ECS / NACH / cheque is rejected / returned or if I don't pay EMIs on time?
Dishonouring a check / ECS / NACH is a criminal offence which can be subject to fines under the applicable provisions of the legislation. You may be listed as a defaulter for not paying the EMIs on time. You will have to pay a penalty initially. If, despite repeated reminders, you refuse to regularise your payments, the Bank can legally reclaim your vehicle or property. In comparison, your credit ratings would also be negatively impacted, which will hinder the chances of obtaining a loan in the future. In addition, you will still have to pay a bounce fee on the return of the instrument. Please refer to our Schedule of Charges for the sum of this fee.
2. What is the most common form of loan repayment in India?
In India, most loan products offer the ‘EMI repayment’ method. This EMI amount is generally auto-debited from your bank account with the same bank or different bank. These days, a NACH mandate facilitates the auto deduction of the EMI amount from your bank account.
3. What is pre-payment and partial payment of loans?
Though loans are repaid with monthly EMIs, banks allow you to make occasional additional payments into your loan account that will be adjusted against the principal amount. One can make a partial prepayment or make a full prepayment and foreclose the loan. Though there are no charges for prepayments these days, one should check with the bank for any applicable charges.
4. What is Pre-EMI?
Under the Pre-EMI option, the creditor is only expected to pay interest on the balance of the loan to be paid as a result of progress in the completion of the building. The actual payment of the EMI shall begin after the possession of the property.
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