Tata Capital Home Loan EMI Calculator

TATA Capital Home Loans EMI and EMI Calculator

As TATA Capital puts it, they bring you from ¨Home¨ to ¨Home sweet home¨. They enable customers to turn their dream of owning a house into reality.  

TATA Capital Housing Finance Limited (TCHFL) offers multiple home loan schemes that can be availed for a variety of purposes like construction of a house, purchasing the property and home extension.

What is an EMI?

EMI, standing for equated monthly installment, is a fixed payback method from the borrower to the lender. This is done at a specified date each month. EMI is used to pay both components, principal and interest, of a loan.  There are two ways to calculate EMI: the flat-rate method or the reducing-balance method. Generally, the reducing balance method is considered favourable as the required interest amounts decrease overall.

Factors affecting EMI:

• Loan amount (Principal) borrowed
• Rate of interest
• Tenure of loan
• Resting period

EMI options are definitely beneficial as it is easy on the wallet and enables the borrower to plan his budgeting and expenses in advance. It is because of EMIs available that customers today are able to afford luxurious items that were otherwise out of their reach. It is also useful for the lenders as it ensures fixed income streams coming each month and lesser bad debts.

EMI schemes available with TATA Capital

Four types of EMI options are available with TATA Capital are: 

• Standard EMI: This plan allows you to pay principal amount along with the interest consistently for a defined period of time. It is ideal for customers with consistent income as the EMI amount remains the same for the entire loan period.
• Step Up Flexi EMI: This plan comes with an idea of paying more when you can afford. It allows you to pay lower EMIs and slowly increase the amount as your salary increases. 
• Step Down Flexi EMI: It offers the flexibility to pay higher EMIs in the beginning and lower EMIs as you approach the end of tenure.
• Bullet Flexi EMI: It allows you to pay principal in parts along with EMI. It ensures regular EMI payment and reduces interest substantially.

Calculation of TATA Capital Home Loan EMI

TATA Capital home loan EMI and EMI calculator is an accessible, affordable and accurate tool. It is accessible because it is available free of cost for customers to use. It is accessible by one and all because of its easy and simple to understand interface. The calculation results are accurate and saves applicants of complex computations. 

However, the formula to calculate EMI is as follows:

Equal Monthly Installment (EMI) = P × r × (1 + r)n/((1 + r)n – 1)

Here, 

P = Principal loan amount,

R = Rate of interest on the loan

n = Tenure in number of months

For example – In a situation where customer X borrows a sum of Rs. 10,00,000 at an interest rate of 10% per annum for a tenure of 5 years.  

The resultant EMI will be as follows – 

EMI = 1000000*10*(1+10)*5/(1+10)(5-1) = INR 10,62,352

TATA Capital Home Loan EMI Calculator

Home loans involve large sums of money whose repayment stretches over a tenure of upto 30 years. In order to plan personal budgeting and not getting caught in a financial crisis, loan repayments must be carefully planned in advance.  Repayment of a loan is done in the form of equal monthly installments designed to distribute the amount over the loan tenure.

TATA Capital Home Loan EMI Calculator is an easy and quick online tool to calculate the EMI that needs to be repaid. It is simple, accurate and free. You can access the TATA Capital EMI Calculator here.

Terms related to TATA Capital Home Loan EMI and EMI Calculator

Home loan EMI can be easily calculated after entering basic information pertaining to the loan availed. Here is all the information that you need to enter to obtain the EMI amount. Explained below are the terms related to TATA Capital Home Loan EMI and EMI Calculator: 

• Principal – It is the loan amount borrowed by the customer that needs to be repaid
• Rate of Interest – It is the percentage a borrower has to pay for the amount that has been lent to him. It is of two types : fixed rate of interest and floating rate of interest
• Tenure – It is the loan period granted in which the borrower can repay the loan
• EMI – EMIs are the monthly installments you need to pay as per the amortization schedule 

Benefits of using a TATA Capital Home Loan EMI and EMI Calculator

Customers can avail great benefits upon using TATA Capital Home Loan EMI and EMI Calculator. Some of them are listed below: 

• • Knowing the accurate EMI is an important determinant in choosing loan tenure. TATA Capital Home Loan EMI and EMI calculator helps you decide the tenure. After seeing the calculated results, you can choose a shorter tenure or a longer tenure depending on the affordability of EMIs.
  • TATA Capital Home Loan EMI and EMI Calculator is extremely easy to use. Without complex calculations and mathematical knowledge, one can easily calculate the amount to be paid.
  • Another advantage of this calculator is effective loan management. In case a borrower has surplus funds during the duration of EMI payment, he can assess using this. To understand the impact prepayments have on EMI, TATA Capital Home Loan EMI and EMI calculator can be used
  • EMI calculator helps compare various loan offers and make an informed decision. The calculator will let you know the total cost of each loan and the EMI of the same. A customer can compare the various offerings by multiple lenders and then make a suitable choice

Steps to Calculate Your EMI using a TATA Capital EMI Calculator

The steps to calculate EMI using TATA Capital Home Loan EMI and EMI Calculator are as below: 

• The first step is to choose the loan amount. Customers must enter the principal value by typing it in or adjusting the slider
• In a similar pattern, customers must enter the applicable rate of interest by either typing it in or adjusting the slider
• Next, loan tenure needs to be selected. This can be done in a similar manner as the two above, by either typing it in or adjusting the slider. The tenure can be set both in terms of years or months by selecting the desired option
• As you move the sliders or enter the value, EMI amount and interest amount will be calculated instantly

Components of Home Loan EMI

Home loan EMI comprises two components: principal and the interest amount. Here, principal refers to the amount that has been borrowed by an individual. Whereas interest amount is the additional sum that needs to be paid at a given rate for a fixed time period. The loan interest is usually higher during the early months of the loan duration. This gradually keeps on decreasing as the principal amount on which it is calculated gets repaid. 

Home Loan Amortization Schedule:

An amortization schedule is a complete table of periodic loan payments. It reflects the principal amount and interest of each payment till the loan is paid off. Not only does it show the principal and scheduled payments, but also payments like tax, insurance made by the lender. It shows the time when all scheduled payments are due and also carries forward a new balance. The last row in the amortization schedule reflects the cumulative interest and principal amount for the entire tenure. 

Ways to reduce your home loan EMI

Each one of us wants to be debt-free and away from a financial crisis. Good personal budgeting is the key for any individual. Here are some ways customers can reduce their home loan EMI: 

• Periodically, one should engage in pre-paying the debt. Partial prepayments are an important way to reduce the loan burden. These prepayments are deducted from the principal amount. This would reduce the interest to be paid as the principal on which it is calculated has now been lowered
• An applicant should negotiate loan terms as suited to him. He should request for lower interest rates or longer tenure whenever loan reset comes along. He can also choose between a fixed or floating interest rate.
• A common budgeting technique advised to the borrowers is to try and pay an extra EMI every year. This would have a direct impact on your principal as well as your interest. It would lead to compounded savings. Choosing to pay an additional installment will not only reduce the EMI amount, but also your debt

FAQ

What are the factors affecting calculation of home loan EMI?

Several factors affect the calculation of home loan EMI. They are listed below: 

• Monthly Income (Net)
• Loan Tenure
• Rate of Interest
• Fixed Monthly Obligations

How is FOIR calculated?

FOIR stands for Fixed Obligations to Income Ratio. It is the calculation of fixed monthly obligatory payments as a percentage of his net income. This is a true representation of his disposable income and repayment capabilities. Ideally, FOIR should be between 40% – 50%.

What role does part-payment pay in reducing debt?

Part payments are beneficial in reducing debt. The advantage being it helps in reduction of EMIs. When a borrower makes a part payment, that amount is deducted from the principal amount. This implies that interest calculated going forth will be on the reduced outstanding amount. Hence, it results in reducing financial burden over a period of time.

How does home loan EMI payment reduce tax obligation?

Availing a home loan helps attain tax benefits as well. As per Section 80 C of the Income Tax Act, an individual is entitled to a deduction of Rs. 3.5 lakhs on interest paid on home loan and an additional tax benefit of Rs. 1.5 lakhs.  

How does Tenure Impact Home Loan EMI?

Loan tenure is inversely proportional to home loan EMI. Shorter the tenure, greater the EMI. Similarly, longer the tenure, smaller the EMI amount.

What happens in case of delayed EMI payments?

Borrowers are advised to always pay their EMIs on time. They should plan their loan terms in such a way that they are always able to pay back their dues timely. Delayed EMI payments have few repercussions. It leads to penalties like a charge of 2% over the existing interest rate. This will be applied for the period in which payment has been delayed. Furthermore, it also affects credit score. This can cause issues in all future dealings and borrowings with other lending institutions. 

Plan your financial budgeting and EMI management with TATA Capital Home Loan EMI and EMI Calculator.