Personal Loan Calculator

Introduction to Personal Loans

A personal loan is an unsecured loan that can be used for medical expenses, weddings, travel, home repairs, education, or debt consolidation. Since no collateral is required, lenders rely on your income stability, repayment history, and credit score to decide whether to approve the application.

Formula

The standard EMI formula uses the reducing balance method:

• P = Loan amount
• r = Monthly interest rate
• n = Tenure in months

Eligibility Factors

• Credit score: Higher scores usually unlock better approval odds and lower rates.
• Income: Stable income helps prove repayment capacity.
• Employer profile: Larger and more stable employers may get better offers.
• Debt burden: Existing EMIs affect how much fresh loan you can take.
• Work experience: Longer job stability is often preferred.

Loan Tips

• Compare at least two to three lenders before applying.
• Keep the tenure as short as you can comfortably afford.
• Check the processing fee, foreclosure charge, and late payment penalty.
• Use prepayment if your lender allows it without a large penalty.
• Borrow only what you actually need to keep interest cost under control.

Examples

Example 1: A INR 500,000 loan at 10.5% p.a. for 36 months produces an EMI of about INR 16,236 and total interest of about INR 84,496 before processing fee.

Example 2: A INR 300,000 loan at 12% p.a. for 24 months has a higher EMI but a much lower total interest cost than the same loan taken for a longer tenure.