Housing Loan Calculator- All You Need to Know About

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Applying for a Loan against property is a great option to put your financial worries to rest. But deciding to avail of a home loan is not just the beginning of the journey. There are a lot of things to be considered before applying for a housing loan. The most important aspect is to select the right lender. Although several lenders may offer hassle-free options for home loans at almost similar rates, it is essential to compare all the possible options and make the best possible decision.

Even though a housing loan is a great option, it can be quite a tedious task if you do not know where to begin. You don’t have to be an expert to evaluate how much the EMI you’ll be paying as a result of your home loan. A few basic terms are what you need; using which you can start planning your finances efficiently. Here they are:

Principal Amount of a Loan

This is the total amount of borrowed money that will be repaid.


It is the period or the duration for which the loan is sanctioned. 

Rate of Interest 

It is the rate charged by the lender, depending on which your EMI will be calculated.

What is EMI?

Equated Monthly Instalment (EMI) is a fixed monthly repayment amount made at a specified date each calendar month.

What is a home loan calculator?

Home loan EMI calculator is a self-help tool that helps you calculate your equated monthly instalment independently. 

How to use a home loan calculator?

The first step is to enter the loan amount you want to borrow. Please note – instead of entering the actual value of the property, it would be advisable to enter only 70-80% of the property value, as most lenders do not provide more than this as a loan. After figuring out the principal amount, the best EMI option for you can be calculated using a Home Loan EMI calculator. Using a home loan calculator is quite simple. You need to input the loan amount, your desired loan tenure, and the interest rate. The home loan EMI calculator will compute the EMI you need to pay each month based on the values entered. It also shows how the total interest you will pay throughout your tenure. 

A simple example below shows you how it works: 

Consider you have a loan amount of Rs. Twenty lakhs for a tenure of 20 years at 8% interest. Your EMI will be Rs. 16,729, and you will pay Rs—20,14,912 as interest over the loan tenure.

Benefits of home loan calculator:

Ease of Use 

Entering the key terms and a click of a button away lies your EMI.

Deciding the Best Tenure

You can use the EMI calculator and enter tenures that you feel are feasible, after which you can decide the tenure that works best with your financial plans.

Comparison Between Available Loans 

It can be challenging to choose the right lender with several ones offering favourable home loans. Using the home loan EMI calculator, you can compare the total cost of different loans and thereby derive the best value out of your money.

Loan Management 

An EMI calculator is also helpful in planning your cashflows to make your home loan payments with ease. The EMI computed from the home loan EMI calculator should be added to your other loan payments, e.g. car loan, personal loan, business loan, etc., which help you assess your loan repayment as a whole. It’s advisable to limit your loan repayments to a maximum of 30%-40% of your monthly income. 

When opting for a home loan, you must do thorough research and gain as much knowledge as possible. After all, it is the decision for a lifetime. Making the right choice on the amount you need to borrow as a loan and going for the right home loan service providers is crucial. Use the calculator to reach the correct figures without getting confused and put the funds accordingly. You can always look for comprehensive online platforms that are assisting with everything about home loans. This way, you make the right decision to buy the home of your dreams. 


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