Use
ICICI Student Loan EMI Calculator to calculate your monthly installments &
plan your future and have a proper financial plan monthly EMI’s
In
a knowledge economy that we live in today in India, education plays a pivotal
role. Education empowers us to reach new heights in our career, enables to live
a respectable life, elevates our standard of living, aids accomplish financial
goals, and much more!
Education
is a long-term personal investment that has the potential to generate returns
like none other.
With
an ICICI Student Loan EMI, you can make your dreams come true. The loan for
education is available for career-oriented courses like medicine, engineering,
management, etc. either at a graduate or post-graduate level in prime
institutes in India and abroad. The loan covers tuition fees, examination fees,
library subscription, cost of books, needed lab tools/equipment,
laptop/computer, hostel charges (if any), and so on.
Students
can directly apply for an ICICI Student Loan. However, their parent(s) or
guardian will be treated as co-applicants, and their role will be akin to a
primary debtor (a person who owes money).
But
before you apply for an ICICI Student Loan, as a prudent loan planning
exercise, assess how much the Equated Monthly Instalment (EMI) will be.
When
one takes a ICICI Student Loan, a natural question that comes to mind is how
much the EMI would (Equated Monthly Installment) be that one has to pay back to
the bank every month.
Hope
the following FAQ’s about ICICI Student Loan EMI will answer all your questions
What is ICICI
Student Loan EMI Calculator?
A
ICICI Student Loan calculator helps you know the amount of the EMIs that you
will need to pay towards your ICICI Student Loan and helps make an informed
decision. The EMI-Calculators.com’s ICICI Student Loan EMI calculator also
functions as a ICICI Student Loan interest calculator, as you will be able to
know the interest amount due on your ICICI Student Loan, in addition to the
overall EMI amount, in just 3 simple steps. First, enter the loan amount that
you wish to take. Then, select your preferred tenor. Finally, put in the ICICI Student
Loan interest rate advertised on the website. That’s all!
Our
EMI-Calculators.com’s ICICI Student Loan EMI calculator has been designed to
offer utmost efficiency with maximum simplicity. This EMI calculator is user
friendly, saves time and is highly scalable. What is ICICI Student Loan EMI?
EMI
stands for Equated Monthly Instalment. EMI is the monthly repayment that a ICICI
Student Loan borrower must make to repay the ICICI Student Loan within the
specified loan tenor.
The
following table illustrates the EMI on several ICICI Student Loan amounts with
different tenures.
Factors that
Affect ICICI Student Loan EMI
- Principal– The principal is the loan amount that you avail from the
lender. It is directly proportional to your EMIs – lower principal will
lower your monthly instalments and vice versa.
- Rate of interest– The rate of interest is the rate at which the lender offers
you the loan. It is also directly proportional to the value of your loan
EMIs.
- Tenure– The tenure is the time within which you repay your loan. The
tenure is inversely proportional to your loan EMIs – longer tenure makes
the monthly instalments cheaper and vice versa.
ICICI Student
Loan EMI for Different Loan Amounts
Following
table shows the EMIs for various loan amount based on different tenures at
11.00%* onwards
· The
EMI that you can avail with ICICI Student Loan of 10 Lakh is 10,024 with
15-years tenure. The EMI increases when you opt for tenure of 5 years.
· The
EMI for a loan of 15 Lakh is higher – 30,992, when you opt for 5-years. It
decreases to 15,036 if you opt for tenure of 15 years.
· For
a loan of 25 Lakh, the cheapest EMI you can avail with 15-year tenure – 25,060.
Decreasing the tenure to 5 years increases the EMI to 51,654.
· The
EMI is 72,315 when you avail loan of 35 Lakh for 5 years. The same will
decrease to 35,084 if you increase the tenure to 15 years.
· The
cheapest EMI comes with 15-years tenure with loan of 50 Lakh – 50,120. The EMIs
double when you opt for 5 years tenure.
How is ICICI Student
Loan EMI Calculated?
Equated Monthly
Installment – EMI for short – is the amount payable every month to the bank or
any other financial institution until the loan amount is fully paid off. It
consists of the interest on loan as well as part of the principal amount to be
repaid. The sum of principal amount and interest is divided by the tenure,
i.e., number of months, in which the loan must be repaid. This amount has to be
paid monthly.
E = P x r x
(1+r)^n/((1+r)^n – 1)
- E
is the amount that you will have to pay every month; basically, the EMI.
- P
is the amount that you want to borrow.
- r
is the rate of interest that is applicable but calculated on a monthly
basis instead of the annual rate of interest. It is obtained by using the
formula r = (annual interest/12) x 100.
- n
is the duration of the loan in terms of months. So, if you select a term
of 5 years, n will be 60.
EMI is just
the amount you (borrower) repay to the bank, each calendar month, to clear your
outstanding loan. You have to repay the EMI each month, on a particular fixed
date, for the entire duration (tenure) of the loan, till you repay the entire
outstanding amount. (amount borrowed + interest).
For Example, if you borrow
10,000,000 units of a currency from the bank at 10.5% annual interest for a
period of 10 years (i.e., 120 months), then EMI = Units of currency 10,000,000
* 0.00875 * (1 + 0.00875)^120 / ((1 + 0.00875)^120 – 1) = Units of currency
134,935. i.e., you will have to pay total currency units 134,935 for 120 months
to repay the entire loan amount. The total amount payable will be 134,935 * 120
= 16,192,200 currency units that includes currency units 6,192,200 as interest
toward the loan.
How to
Calculate EMI for ICICI Student Loan?
Calculating the
EMI amount on your ICICI Student Loan is quite easy. Simply enter the loan
amount you wish to take, the tenor (in months, and not years) and the rate of
interest, in the required fields.
Once you find the
EMI calculator for ICICI Student Loan, to calculate the amount of EMI, you
need to put the following inputs in the EMI calculator:
- Loan
Amount –
The principal amount borrowed from the bank or financial institution is
known as the loan amount.
- Interest
Rate –
Interest rate can be either fixed or floating.
- Loan
tenure – Is
the time over which you choose to repay the loan.
The result will be
your EMI, the total interest you’ll be paying and the total amount you’ll be
paying by the end.
Who can apply
for an ICICI Student Loan EMI?
The eligibility
criteria are as follows:
§ · The applicant and
co-applicant should be over 18 years of age and citizen of India(Identity Proof
– Aadhaar, Passport / Driving License / Voter ID / PAN)
§ · The student needs
to have secured at least 50% marks during HSC and graduation
§ · The student needs
to have obtained admission to career-oriented courses viz. Medicine,
Engineering, Management, etc., either at the graduate or post-graduate level
§ · Secured admission
in India or abroad from a recognized college/ education institutions in India through
entrance test/merit based selection process post completion of HSC (10+2), is a
must
§ · The co-applicant,
i.e. parent(s) or guardian, need to have a regular source of income
What are the
documents required to avail an ICICI Student Loan EMI?
The following need
to be submitted along with the ICICI Student Loan EMI application form:
§ · Income Tax statements (Salary slip, Form 16,
Income-Tax Returns of the last 2 years, and Computation of income of last 2
years certified by a Chartered Accountant)
§ · Bank Statement/Pass
Book of the last 6 months along with PAN
§ · Copy of the
admission letter of the Institute along with the ‘fee schedule’
§ · Mark sheets and/or
pass certificates of SSC, HSC, Degree Courses, National level entrance test
§ · Age proof (Aadhaar, Passport / Driving License / Voter ID / PAN, driving license)
§ · Address proof (Aadhaar, Passport / Driving License / Voter ID / PAN, latest electricity bill, latest telephone bill, ration card,
existing house lease agreement, bank account statement)
§ · Photo
identification proofs (Aadhaar, Passport / Driving License / Voter ID / PAN)
§ · Passport size
photos of the applicant and co-applicants
§ · Guarantor form
(optional)
How much time
does the bank take to convey its decision of sanctioning or rejecting the loan
application?
The bank sanctions
the ICICI Student Loan only after thorough due diligence. Any Bank usually
disburses loans within 15 days from the date of receipt of the complete
application along with all documents required for a full appraisal.
How much is
the margin money required to avail an ICICI Student Loan EMI?
There is no margin
for ICICI Student Loans up to Rs 4 Lakhs. For loans above Rs 4 Lakh, the margin
for studies within India is 5% and for studies overseas is 15%.
What are the
documents required at the time of disbursement of ICICI Student Loan EMI?
The documents
required for the first disbursement are:
§ · Demand Letter from
college or university
§ · Disbursement
Request Form (DRF) signed by the applicant, co-applicants
§ · A signed copy of
Loan Agreement (which includes Demand Promissory Note, DP Note
Delivery-cum-Waiver Letter, Standing Instruction Request, PDC (Post-dated
Cheque)
§ · Sanction Letter
signed by the applicant, co-applicants
§ · Form A2 signed
(for the purchase of foreign exchange) by applicant or co-applicants in case
abroad Institute cases
§ · Receipts of Margin
Money paid to the college/university along with bank statement reflecting the
transaction
§ · Documents for
collateral security ( if applicable)
§ · Form A2 signed by
the applicant or co-applicants in case of overseas institute
§ · For subsequent
disbursements as well, many of the aforementioned documents will be needed,
particularly the demand letter from the college or university, DRF, receipt of
margin money paid, and one any from the exam progress report, mark sheet,
bonafide certificate.
What if I
miss my ICICI Student Loan EMI or pay late? Are there any charges?
Yes, Rs 500 +
taxes per cheque bounce and a penal interest @24% per annum i.e. @ 2% per month
on the overdue instalment/s. So, as far as possible, keep your repayment track
record clean.
Is an ICICI Student
Loan EMI eligible for tax deduction?
Yes. When you
avail an ICICI Student Loan, the interest paid (which is a component of your
EMI) on the ICICI Student Loan is allowed as a deduction under Section 80E of
the Income Tax Act, 1961. The deduction is available for a maximum of 8 years
or till the interest is paid, whichever is earlier.
What are the
Advantages of Knowing ICICI Student Loan EMI in Advance?
Good planning
always ensures stable finances. Calculating the ICICI Student Loan EMI in
advance gives a better understanding of the amount of money you would have to
spend every month. Hence, you can plan well and decide whether you are able to
spare that much money or not.
Components of
a ICICI Student Loan EMI Calculator?
- Amount
of loan to calculate EMI
- Loan
term (months or years) to calculate EMI
- Rate
of interest (percentage) to calculate EMI
How to use ICICI
Student Loan EMI Calculator?
Using the EMI
Calculator is a very simple process. All you need to do is follow these steps–
§ · Go the ICICI Student
Loan EMI Calculator page
§ · Choose the loan
amount, rate of interest, and tenor (in months)
- That’s
all! You will instantly get your ICICI Student Loan EMI amount along with
the interest amount payable on the loan.
What are the
Advantages of a ICICI Student Loan EMI Calculator?
A ICICI Student
Loan EMI Calculator helps you to decide whether you can afford the financial
commitment of a ICICI Student Loan in the long term. If you want, you can
increase or decrease your EMI amount depending on the amount of loan you are
taking and the time period for which you’ll be paying the EMIs.
Quick Results – Applicants
can easily use this calculator to calculate the EMIs that they will be liable
to pay for the pre-determined tenure and interest rate that the ICICI Student
Loans are offered, in mere seconds.
Simplicity – The
calculations using this EMI calculator for ICICI Student Loan are based on the
applicant providing three key bits of information i.e. the principal amount of
the loan, the applicable rate of interest and the loan tenure.
Varying
Combinations – With the ICICI Student Loan EMI calculator, you can
easily input different interest rates and tenures to look for a combination
that will allow you to easily repay the principal amount, without putting undue
pressure on your finances.
Free Usage –
The EMI-Calculators.com’s ICICI Student
Loan EMI calculator is a user-friendly ICICI Student Loan calculator that is
available to everyone free of charge and is easy to use
What Is a ICICI
Student Loan EMI Amortization Schedule?
A ICICI Student
Loan amortization schedule is the table or record which details all the
periodic payments on your loan. This is generated through an amortization
calculator.
Amortization is
basically the procedure of repaying a loan through regular payments over a
specified period. An amortization schedule is the total tally of loan payments
showing the amount of interest and principal contained in each payment, until
the loan is repaid in full.
What are the
factors that impact monthly ICICI Student Loan EMI?
The estimated
monthly investment (EMI) depends on several factors such the amount, the tenure
of the loan, and the interest rate. The estimated monthly investment (EMI)
differs according to the loan type and the amount. If the interest rate of the
loan is fixed, the estimated monthly investment remains fixed as well for the
entire time the loan is active. The borrower can also opt for a pre-payment
wherein the estimated monthly investment (EMI) gets reduced. If the interest rate
is floating, the EMI is also floating.
What is
Flat/Fixed Rate of Interest? And Flat/Fixed Rate of Interest Effect your EMI
for ICICI Student Loan?
A fixed rate of
interest is one where the interest rate on a loan remains fixed throughout the
loan repayment period (loan tenure). This type of interest rate is
comparatively higher than a floating rate of interest. Fixed rate of interest
is better for those who don’t prefer the risk of fluctuation that is an
integral part of a variable interest rate. In the case of a fixed rate of
interest, the loan EMI remains the same throughout the loan tenure.
The online loan
EMI calculator can be used to calculate loan EMIs with a fixed rate of
interest. The different Interests Rates that can be implied in a Loan contract
are Fixed Interest Rate and Floating Interest Rate.
Fixed Interest
Rate means interest payment on loan will be in fixed equal installments over
the entire period of the loan. The interest rate will not change regardless of
any market fluctuations.
Benefits
of Fixed Interest Rate:
- Interest
Rate does not change as per the market fluctuations
- Having
a fixed interest rate brings a sense of safety and security for the
borrower
- Since
it entails a fixed monthly repayment schedule, it helps in easy budgeting
Drawbacks
of Fixed Interest Rate:
- Generally,
Fixed Interest Rates are 1%-2.5% higher than Floating Interest Rate
- Fixed
Interest Rates are subject to change as per the market fluctuations, hence
if by chance the interest rate decreases, the fixed rate ICICI Student
Loan won’t be benefited as the borrower will have to pay the same fixed
amount every month.
What is
Floating Rate of Interest? And Floating Rate of Interest Effect your EMI for ICICI
Student Loan?
Floating rate of
interest changes depending on the market-lending rate. It is also known as
variable rate of interest. If the lending rate increases, the floating interest
rate will also increase. Due to the risk of fluctuation, the floating rate of
interest is usually lower than the fixed rate of interest. With a floating rate
of interest for a specified loan tenure, you can either expect your EMI to reduce
or increase depending on the rise in the interest rate.
The online loan
EMI calculator for ICICI Student Loan can be used to calculate loan EMIs with a
Floating rate of interest.
Floating Interest
Rate is the rate which changes as per the market conditions. Loans on floating
interest rates are tied to a base rate PLUS a floating element thereof.
Benefits
of Floating Interest Rate:
· Floating Interest
Rates are cheaper than Fixed Interest Rate
· During the long
term, even if the floating interest rate rises the fixed interest rate, they
will eventually fall. Hence ensuring a lot of savings.
Drawbacks
of Floating Interest Rate:
Due to frequent
fluctuations in interest rate, the nature of monthly installments is quite
uneven.
Hence it is
necessary that you conduct a proper cost and benefit analysis before choosing
among Fixed and Floating Rate of Interests.
Why should I
use an ICICI Student Loan EMI calculator?
The simplest
answer is that it’s fast and it’s convenient. This means that you can do
multiple calculations in minutes where such calculations many take longer were
you to sit down with a pen and paper. These calculators are also super
accurate, so it eliminates the possibility of errors in calculations, provided
you provide accurate data.
Will banks
provide the ICICI Student Loan EMI calculator?
Yes. These days
most, if not all, banks have ICICI Student Loan EMI calculator, specific to
various loans, available on their websites.
How much
should I pay as monthly EMI for ICICI Student Loan?
Monthly EMI for ICICI
Student Loan depends upon your income and expenses. Generally, banks advise you
to limit your EMI to 35% to 45% of your net income so that you can pay your EMI
without any burden or difficulty. You can calculate your EMI online which will
help you to know your repayment capacity.
What if I
miss EMI payment for ICICI Student Loan or there is an ECS bounce?
If you miss your
EMI payment on your ICICI Student Loan or if there is an ECS bounce then bank
may charge a penalty. In addition, it will also be reflected in your CIBIL report and
your CIBIL score may
get impacted.
What if I get
delay in paying the ICICI Student Loan EMI?
Banks charges
penalty for delaying EMI payment for ICICI Student Loan. The amount of penalty
varies from bank to bank. This also impacts your CIBIL Score.
Why it is
necessary to calculate ICICI Student Loan EMI beforehand?
It is important to
calculate your EMI in advance to maintain stability in future payments. When
you avail loan for your ICICI Student Loan, you promise the bank to pay a fixed
amount at fixed date every month. So, before availing the ICICI Student Loan
you should consider the stability of your income, monthly expenses and the
existing loan obligations to avoid any discrepancies in future payments.
Does the loan
tenure affect my EMI for ICICI Student Loan?
ICICI Student Loan
can be availed for maximum tenure of 20 years. Tenure affects your monthly EMI.
Longer the tenure of ICICI Student Loan, lower will be your EMI.
Must Know
things before you have ICICI Student Loan EMI:
What
happens if you don’t pay ICICI Student Loan EMI?
What happens if I
miss my EMI payment? You can only miss your EMI if you have insufficient funds
in your bank account. Few days grace period will be given to you to pay your
EMIs. Further delay in payments will be reported to CIBIL and will
have financial charges.
Should
I pay my ICICI Student Loan EMI/ bill early?
At a minimum, you
should pay your ICICI Student Loan bill or EMI before its statement due date.
You can never pay your ICICI Student Loan too early but be sure to check the
statement period to which your early payment will be credited.
What
happens if I only pay the minimum payment on my ICICI Student Loan?
What Happens If I
Make Only the Minimum Payment on My ICICI Student Loan? Paying only the minimum
keeps you in debt longer, costs you money in interest and could hurt your
credit score. … If you pay the minimum toward your balance each month, here’s
what you can expect to happen: Paying down your debt will take much longer.
Can
I foreclose my ICICI Student Loan EMI?
Yes, you can clear
the future EMI of your ICICI Student Loan by paying the total outstanding in
one go. But you should first ask the concerned bank regarding the same. And, if
your lender does not charge on the foreclosure, it would be better going with
your impending move of paying the entire outstanding.
How
can I avoid paying interest on my ICICI Student Loan?
The best way to
avoid paying interest on your ICICI Student Loan is to pay off the balance in
full every month. You can also avoid other fees, such as late charges, by
paying your ICICI Student Loan bill on time.
Is
ICICI Student Loan EMI better option?
Although a good
EMI scheme is easy on your wallet, you must try to avoid it as the first
option. You may not only be spending more than the actual worth of the product,
but also splurging first and then relying on EMI payments is not healthy for
your finances.
Is
ICICI Student Loan EMI good?
The best form of
the EMI option is where there is no interest charged on the payment. … So, an
expense of Rs 12,000 spread over 12 months will lead to an EMI of Rs 1,000 a
month, that will come in each month’s ICICI Student Loan bill.
What
is ICICI Student Loan EMI scheme?
To facilitate ICICI
Student Loan EMI option, banks charge a loan processing fee upfront. The loan
processing fee varies from bank to bank and is usually 0.5% to 1% of the amount
of your purchase. Interest.
Step by step
guide before having ICICI Student Loan EMI:
Step
1 : Check ICICI Student Loan EMI and calculate ICICI Student Loan eligibility –
ICICI Student Loan EMI Calculator
As you decide to
take a ICICI Student Loan, always estimate your loan amount eligibility to know
the loan amount you will be eligible for and can apply for. Also calculate the
monthly EMI that you can comfortably service given your net take personal
salary and other existing fixed obligations including rent and EMIs on other
existing loans, if any. Your ICICI Student Loan eligibility is calculated based
on your age, net income, existing obligations, property type, LTV ratio and
other factors. EMI is dependent on the loan amount, interest rate and tenure.
Once you understand your minimum loan requirement, your eligibility and monthly
EMI you can comfortably service, shortlist the banks which offer you maximum
loan amount to meet your requirements.
Step
2 : Check loan approval status and legal documents – ICICI Student Loan EMI
Calculator
If you are buying
a property from builder, then check for the banks which have approved the
projects you have shortlisted. For resale property, check the approved map
plans and ensure that all property registration papers for the complete chain
from the first owner to current owner are in place. Shortlist the banks which
lend on your chosen property.
Step
3 : Decide on type of ICICI Student Loan interest rate offers – ICICI Student
Loan EMI Calculator
As you narrow down
the list of banks in Step 2 and 3, you need to conduct an interest rate on ICICI
Student Loan comparison of the loan offers of various banks. Some of the
interest rate offers that needs to be checked are:
Choice between
fixed and floating rates – Fixed rates come at a slightly higher rate of
interest compared to floating rate loans and interest rate remains constant
during the tenure of ICICI Student Loan. In floating rate loan, interest rates
are reset at periodic intervals in response to changes in MCLR and PLR rates of
banks or NBFCs. Majority of ICICI Student Loans in India today are floating
rate loans as it allows the borrowers to get ICICI Student Loan interest rate
in line with the current interest rates.
Decide if you need
a home saver loan – This is a loan with overdraft facility which allows you to
deposit surplus amount in your ICICI Student Loan overdraft account as and when
available, allowing you to reduce your overall interest amount. This loan is
highly recommended for salaried individuals with high bonuses and self-employed
business which is seasonal and has fluctuating cash flows. The interest rates
on overdraft loan is slightly higher than that of a regular ICICI Student Loan
interest rate.
You can also
evaluate a mortgage guarantee ICICI Student Loan as it covers any default risk
and allows the lender to give you loan at low rate of interest. You will
however need to pay a mortgage guarantee fee to the bank.
Check and compare
the current ICICI Student Loan interest rates of the banks on various types of
loan products and take an informed decision.
Step
4 : Compare shortlisted banks | ICICI Student Loan EMI Calculator
In addition to
interest rates, banks also charge many other fees on ICICI Student Loans. Along
with interest rates, you should check other associated costs with your loan
which include prepayment charges, processing fee, insurance premium and other
charges offered by the shortlisted banks. You should calculate all-inclusive
costs on ICICI Student Loan to be able to further shortlist the banks and
reduce your choice to 2-3 banks.
You can take the
help of loan advisors of online on various websites listed below.
- · https://studentloanhero.com/
- · https://www.avanse.com
- · https://www.myloancare.in/
- · https://www.paisabazaar.com/
- · https://www.bankbazaar.com/
- · https://indianmoney.com/
- · https://www.deal4loans.com/
- · https://www.wishfin.com/
- · https://indialends.com/
- · https://www.bajajcapital.com/
- · https://www.apnapaisa.com/
- · https://www.rubique.com/
- · https://www.bajajfinserv.in
Step
5: Select the bank based on other service related parameters | ICICI Student
Loan EMI Calculator
Finally, as you
decide to take the loan, also consider other service and transparency related
parameters of the chosen banks. Some of these factors are turnaround time
offered by the banks, quick loan delivery, doorstep services, transparency in
the loan process. You also need to understand the trends and changes in MCLR
rates over a period. Last but not the least, read reviews of existing customers
on banks on their services, interest rates and transparency to take your
decision to borrow from a bank.
Bank specific
ICICI Student Loan EMI Calculator FAQs
1. What
benefits do I get by calculating my EMI before taking an ICICI Student Loan?
Calculating your
EMI before taking a loan can help you in the following ways:
You can manage
your monthly expenses better. Once you know how much you have to pay towards
your loan each month, you can then budget the other expenses accordingly. You
will be able to determine what tenure to choose depending on how much you can
afford to repay every month. Planning prepayments and pre-closures can be done
easily, helping you pay off your loan faster.
2. Will my
EMIs change in case of prepayment?
When you prepay a
part of your loan, the outstanding principal will reduce. This allows you to
opt for a lower EMI while keeping the loan tenure the same. Or, you can
maintain the same monthly instalment as before and reduce the tenure of the
loan. It is advisable to maintain the same EMI and reduce the tenure since this
will reduce the amount of interest you pay in the long run.
3. Can I use
the same ICICI Student Loan EMI calculator for all banks?
Yes. An EMI
calculator is a common tool and is not tied to any bank or financial
institution. If you know your principal, interest rate, processing charges, and
tenure, you should be able to generate your EMI. BankBazaar’s calculator also
allows you to factor in prepayment details.
4.How
accurate is an ICICI Student Loan EMI calculator?
An EMI calculator estimates your loan repayment details based on
the data you give it. But the EMI that your bank gives you may be a little
different due to other charges involved in the calculation. Also, if your ICICI
Student Loan is subject to a floating rate, then the interest rate changes
every year based on the MCLR or base rate change. Even a slight change in
interest rate will make a difference to the total loan amount you repay,
depending on the duration of the loan. These variables limit the accuracy of an
EMI calculator.
5. Why are
the interest charges in the repayment table slightly higher during the initial
months of the loan?
The interest rate
of your loan is applied based on “reducing balance principle”. Because of this,
the interest will be slightly higher during the initial phase since the
principal outstanding is higher. As this amount reduces, the incidence of
interest will also come down proportionately.
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