Purchasing a car is a big deal in India and even more so, when you’re buying your first car. Whether it is your first car or not, if you’re thinking about getting a car loan then it is best to understand all aspects of it before committing to it. Today, a borrower can get their loan sanctioned by Banks, NBFCs and Online Lenders. To help car buyers choose the best car loan, there are a lot of online car loan calculators available which help them understand car loan interest rates and an optimal EMI (Equated Monthly Instalment) amount. They help you choose a suitable car loan amount which will in turn help you manage your monthly finances in a structured and thought-out manner.
In order to understand car loan calculators, it is first important to understand what an Equated Monthly Instalment (EMI) is. Simply put, the Equated Monthly Instalment is a fixed amount of money that the bank is entitled to till your car loan matures. The EMI amount depends on the tenure that the loan is being taken for. A higher EMI loan comes with a loan for a shorter period as opposed to that with a lower EMI loan. Preference for selecting EMI is subjective and depends on how much the borrower wants to pay every month.
How Car Loan Calculators Work
Car Loan EMI Calculators are tools which give you an indication on how much EMI you will have to pay depending upon the tenure that you select. The calculation of your EMI is contingent upon the principal amount of your loan (P), rate of compounded interest applicable to your loan (R) and the tenure (N). The formula that most Car Loan EMI Calculators apply to give you a preliminary EMI Calculation is:
EMI = [P x R x (1+R)^N]/[(1+R)^N-1]
Some of the other factors that your EMI will be dependent upon are:
- Credit Score
- Income Statement
- Financial Statement
- Existing Financial Liabilities
While selecting an EMI amount, it is important to factor in your monthly budget. This will help you choose the right car loan without straining your monthly expenditure too much.
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Easy Online Car Loan Calculator by PaySense
PaySense offers an easy to use Car Loan EMI Calculator that lets you select the Principal Amount of the Loan that you want to select and gives you an idea about the various tenures. We give you a clear picture of the EMI Amounts that you can choose from depending upon the tenure of the loan. You also get a comparison of the total interest that you would be paying. With PaySense, you can instantly get a personal loan for upto Rs. 2 Lakhs without waiting for your Bank or NBFC to get back to you. Why wait to pay that down payment for your dream car?
Apply for Loans of upto ₹5 Lakhs easily using your phone or laptop, and pay back on low EMIs