# How to Use and Make the Most of a Personal Loan Interest Calculator?

## Personal Loan Interest Calculator is a tool that gives you access to be aware of your total interest and advance to need to pay throughout the loan tenure.

Personal loans are easily accessible advances that come with attractive features and simple terms of financing. Courtesy their easy eligibility requirements and simplified paperwork, individuals in need of funding can access them conveniently. However, irrespective of how easy they are to avail, prudence is always required when availing the advance. Thus, you must make your borrowing decision based on necessary financial assessments such as how much to borrow, repayment affordability, and the interest payable. To make these assessments conveniently, you can use dedicated financial tools like a **personal loan interest calculator**.

These loan calculators are designed based on specific formulas and are easy to use. Let’s know in detail about these financial tools and maximise their usage for an optimised borrowing decision.

## What is a Personal Loan Interest Calculator and How to Use It?

A personal loan interest calculator, also commonly known as an EMI calculator, is a self-help financial tool that allows you to assess the total interest payable on the advance throughout the loan tenure. It works on the basis of a pre-fetched formula and is quick to compute the required results. This not only gives the lengthy manual calculations a pass but also makes the computations accurate. It is thus recommended to make the most of this unique financial tool. Given that the calculator is available for free and can be accessed easily on a reputed lender’s website, accessing it should not be a challenge.

The preset formula that computes the necessary value in the calculator goes as –

EMI = P x R x (1+R)^N/[(1+R)^N – 1]

Here, the three values that you need to enter and corresponding with the formulaic expressions include -

1. The loan amount you seek to avail, represented as ‘P’ or the Principle

2. The rate of interest applicable to your **personal loan** as per your selected lending institution, represented as ‘R’

3. The tenure or the term selected for loan repayment, represented by ‘N’, which stands for the repayment term calculated as total months and not as the total number of years

Based on these entries, the personal loan interest calculator computes the required values.

Following are the results that even a basic calculator available online is able to compute.

- The total loan liability payable for the entire tenure

- The EMIs payable towards loan repayment each month until the tenure ends

While these are the minimum calculations, some sophisticated personal loan interest calculators also compute and/or display the following.

- The total interest payable for the tenure

- A detailed amortization schedule carrying principal+interest break-up of each EMI

- Loan outstanding after each year of repayment until tenure completion

- A pie chart indicating the percentage of total loan amount borrowed and interest payable out of the total loan liability

## How to Make the Most of the Personal Loan Calculator?

You can keep the following things in mind to make the most of your interest calculator.

- Make changes to the loan amount and tenure entries to see its impact of the EMIs and interest payable to check affordability.

- Any change in the loan amount is directly proportional to the EMIs and total interest payable.

- The changes made to the tenure value impact the EMIs inversely, thus decreasing them with an increase and vice versa.

- However, the tenure changes are proportionate to the total interest payable. So, while a tenure increase reduces the EMIs, it pumps up the total interest liability as well.

- You must keep these changes to the tenure selection in mind for an affordable borrowing decision.

Along with a personal loan interest calculator, other financial tools that you can access for free include an eligibility calculator, foreclosure calculator, balance transfer calculator, and the likes. These financial tools make borrowing convenient while assisting with your repayment decisions as well, thus making loan management easy.

Personal loans are easily accessible advances that come with attractive features and simple terms of financing. Courtesy their easy eligibility requirements and simplified paperwork, individuals in need of funding can access them conveniently. However, irrespective of how easy they are to avail, prudence is always required when availing the advance. Thus, you must make your borrowing decision based on necessary financial assessments such as how much to borrow, repayment affordability, and the interest payable. To make these assessments conveniently, you can use dedicated financial tools like a personal loan interest calculator.

These loan calculators are designed based on specific formulas and are easy to use. Let’s know in detail about these financial tools and maximise their usage for an optimised borrowing decision.

## What is a Personal Loan Interest Calculator and How to Use It?

A personal loan interest calculator, also commonly known as an EMI calculator, is a self-help financial tool that allows you to assess the total interest payable on the advance throughout the loan tenure. It works on the basis of a pre-fetched formula and is quick to compute the required results. This not only gives the lengthy manual calculations a pass but also makes the computations accurate. It is thus recommended to make the most of this unique financial tool. Given that the calculator is available for free and can be accessed easily on a reputed lender’s website, accessing it should not be a challenge.

The preset formula that computes the necessary value in the calculator goes as –

EMI = P x R x (1+R)^N/[(1+R)^N – 1]

Here, the three values that you need to enter and correspond with the formulaic expressions include -

1. The loan amount you seek to avail, represented as ‘P’ or the Principle

2. The rate of interest applicable to your personal loan as per your selected lending institution, represented as ‘R’

3. The tenure or the term selected for loan repayment, represented by ‘N’, which stands for the repayment term calculated as total months and not as the total number of years

Based on these entries, the personal loan interest calculator computes the required values.

Following are the results that even a basic calculator available online is able to compute.

- The total loan liability payable for the entire tenure

- The EMIs payable towards loan repayment each month until the tenure ends

While these are the minimum calculations, some sophisticated personal loan interest calculators also compute and/or display the following.

- The total interest payable for the tenure

- A detailed amortization schedule carrying principal+interest break-up of each EMI

- Loan outstanding after each year of repayment until tenure completion

- A pie chart indicating the percentage of the total loan amount borrowed and interest payable out of the total loan liability

## How to Make the Most of the Personal Loan Calculator?

You can keep the following things in mind to make the most of your interest calculator.

- Make changes to the loan amount and tenure entries to see the impact of the EMIs and interest payable to check affordability.

- Any change in the loan amount is directly proportional to the EMIs and total interest payable.

- The changes made to the tenure value impact the EMIs inversely, thus decreasing them with an increase and vice versa.

- However, the tenure changes are proportionate to the total interest payable. So, while a tenure increase reduces the EMIs, it pumps up the total interest liability as well.

- You must keep these changes to the tenure selection in mind for an affordable borrowing decision.

Along with a personal loan interest calculator, other financial tools that you can access for free include an eligibility calculator, foreclosure calculator, **balance transfer calculator**, and the like. These financial tools make borrowing convenient while assisting with your repayment decisions as well, thus making loan management easy.