Loan Against Property EMI Calculators and Loan EMI Calculators: A Comprehensive Overview
Calculators calculating the Loan Against Property and EMI calculators for a general loan, both are considered quite important financial tools. They are designed to help people get a good estimate of their monthly repayment. It’s easy to understand how these calculators work and help potential borrowers make better financial decisions. Below is an overview of how the LAP EMI calculator works compared to the general loan EMI calculator, with differences in application.
What is a Loan Against Property EMI Calculator?
A loan against property EMI calculator is an online tool that helps borrowers find the equated monthly installments (EMI) on loans taken against real estate. Such a loan enables an individual to borrow funds in the position of either a residential or commercial property. The calculator can be used to determine the amount to be paid monthly as soon as one enters the value of the loan, the rate of interest and the tenure of the loan.
Key Features of LAP EMI Calculators
Here are the key features of an LAP EMI calculator.
- Enter parameters: The parameters generally include the loan amount, interest rate, and tenure. The calculator calculates the EMI from these parameters.
- Instant results: By using an LAP EMI calculator, results are almost instantaneous, making it easier for the user to instantly understand the repayment obligations.
- Financial planning: Knowing the amount that is going to be repaid monthly provides clarity for financial planning. The borrower will be able to budget accordingly.
- Comparison tool: Most of these calculators are designed with provisions which allow users to change the loan amount, interest rate, and tenure. It also helps find out how the changes impact the EMI to aid in decision-making.
What is a General Loan EMI Calculator?
A general Loan EMI Calculator is a financial tool that helps borrowers determine the monthly payment they need to make to repay a loan. This calculator simplifies the process of estimating EMIs for various types of loans, including home loans, car loans and personal loans.
Key Features of General Loan EMI Calculators:
The following are some key features of a general loan EMI calculator.
- Versatile: These calculators can be used for different loan types. This means they are more versatile for people who use more than one kind of loan.
- Helps in Budgeting: The functionality of general loan EMI calculators is the same as that of LAP calculators. It provides better planning for the borrower’s finances as individuals get proper clarity regarding the amount of repayment.
- Detailed breakdown: Some general loan calculators also provide detailed reduction schedules, stating the break-up of the principal and interest for each EMI during the loan tenure.
How is a LAP EMI Calculator Different from a General Loan EMI Calculator?
The following table highlights the major differences between a LAP EMI calculator and a general loan EMI calculator.
Feature | Loan Against Property EMI Calculator | General Loan EMI Calculator |
Purpose | Designed to calculate loan EMI for loans secured against a property. | Can be used to calculate EMIs for all kinds of loans. |
Interest rate | The interest rates may be much lower as this is a secured loan. | Interest rates on unsecured, general loans are quite high. |
Usage complexity | It is a bit complex, as knowing the valuation of a property can be tricky. | Simple, only basic loan details are required. |
Output detail | Focused on property-related loans. | General output applicable to multiple loan types. |
Factors to Consider for LAP and Loan Calculators
Consider the following factors while using a LAP and a general loan calculator.
Credit Utilisation Ratio
- For LAP: As these are considerably large transactions, LAP will have a significant impact on your ratio of credit utilisation. If the loan size against property exceeds a certain level in relation to the quantum of credit, then it will drag down your credit score if it crosses 30% of the total credit limit.
- For general loans: This type of loan may affect the ratio in the case of unsecured ones. However, as they are generally of smaller quantum, the effect may not be that strong.
Credit history:
- For LAP: Regular payment on a LAP would help increase your credit score, and prove your worthiness in borrowing. Any lapse in payment would attract severe penalties, such as a foreclosure on the property.
- For general loans: Similarly, it would be very crucial to have a good paying history on general loans for a good credit score. Delayed payments would be accountable for decreasing your credit score, irrespective of the loan scheme.
Conclusion
The EMI calculators are very important financial planning tools and serve crucial purposes for borrowers taking either a loan against property or a general loan. Their use and collateral requirements are somewhat the same, but the difference lies in the complexity of calculations and the results offered. Borrowers could understand what these tools entail to point out which loan would suit their needs best. By using these calculators, people can make proper budgets and pay loans better.