Personal loan interest rates

Personal Loan EMI Calculator

The Personal Loan EMI calculator is most useful to figure out the EMI that you are most comfortable with. The personal loan EMI calculator uses three variables-

  • Amount of Loan
  • Personal loan interest rate
  • Tenure of loan

The amount of personal loan you wish to take will depend on your need and be limited by your eligibility.

The personal loan interest rate is decided by the lender. You may compare different lenders to get the cheapest personal loan interest rate.

The tenure of the loan is in your hands. You can play around with this variable and work out the most convenient EMI for you.

Once you calculate the EMI, it will be obvious if it will fit into your monthly budget. Else you will have to opt for a longer-term to reduce the EMI.

The personal loan EMI calculator is a must-use feature before you put in an application for a personal loan.

Personal Loan Interest Rate

Personal loans are unsecured loans. They are collateral-free which means no asset needs to be pledged by the borrower. Personal loan interest rates are higher than secured loans like home loans or vehicle loans because of this reason. Lenders need to protect themselves from the additional risk by applying higher interest rates.

Lowest Rate Personal Loans

In India, Personal loans are available at interest rates close to 11% and going up to 24% per annum. There are no fixed rates for personal loans and they may vary depending on the CIBIL score and eligibility of the borrower.

Personal loans interest

Even if the personal loan interest is higher than secured loans, many young borrowers opt for personal loans because they are unsecured and flexible. You can use a personal loan for any legal purpose without specifying it.

The lowest interest rate personal loan would be around 11%p.a but most personal loan rates will change from borrower to borrower. If you have a high income, a better CIBIL score, work with the government or a blue-chip company you may get the lowest interest rate personal loans.

If you are looking for the Best banks for personal loans, you should be aware that all lenders come up with offers from time to time. A lot of banks, NBFCs and fintech lenders offer Low-interest rate personal loans. These offers and rates may change from time to time. It is best to compare all lenders and choose the offer that is best for you.

Rates for personal loans are always higher than the interest rates for secured loans. Home loans and vehicle loans come cheaper because of the security of the underlying assets. You can take a personal loan in an emergency and try to pay it off in full after six months. After six months, no prepayment penalty is applicable.

Low Interest Rate Loans are the dream of every borrower. You can track the lender sites on a regular basis for any special offers if you can afford to defer your personal loan requirement. In an emergency situation, you may avail of a personal loan irrespective of the rate. Even in such circumstances, information is freely available on the net. You can check out loan aggregator sites to compare the rates of different lenders and pick the cheapest one available. If you have a good credit score you may be in a position to bargain for better rates.

Processing fee for personal loans is usually around 2% of the loan sanctioned amount. If you have a high credit score, you can try and negotiate with the lender to reduce or waive off the processing fee. If you are a regular customer of the bank, they may be happy to waive it off. It is best to know about the processing fee and other charges before you sign the personal loan agreement as each of these charges add up to the cost of the loan.

Personal Loan Rate in India range from 11% to over 24% depending on the lender and the eligibility of the individual borrower. If the borrower has a poor credit score, he may get a personal loan at a higher rate of interest.  The personal loan rate depends on your relationship with the lender, the income you earn, the reputation of your employer and your credit score. If all the above points are in your favour, you may get a better personal loan interest rate. Since personal loans are unsecured loans, the lender has to protect his own interest and will have to charge a higher rate of interest. If the lender is convinced about your repayment capacity and does not fear a default he may agree to give you a personal loan at a lower interest rate.

How to  calculate personal loan interest?

The formula for calculating the EMI is given below –

EMI =[Px(R/100) x{ 1+(R/100)}^N] / [{1+(R/100)}^(N-1)]

Where –

EMI = Equated Monthly Instalment

P = Principal

R= Rate of Interest (monthly basis) which means Annual interest rate/12

N = Loan tenure in months

The total EMI is the sum of the principal and the total interest payable over the tenure. Every monthly instalment includes a component of the interest and principal.

The loan outstanding is adjusted every month by the amount of principal repaid and interest is calculated accordingly.

Personal loan interest rate calculator is used by borrowers to understand the total EMIs and the total interest component that needs to be paid. The lower the repayment tenure the less the interest outgo. It makes a lot of sense to take a personal loan for the longest tenure available to get the lowest EMI. After servicing the loan for six months, you can try to prepay the loan as quickly as possible as the prepayment penalty will not be applicable. You can use any sudden fund inflows or salary increments or bonus for this purpose. Prepaying your loan after six months will help you avoid the prepayment penalty while early foreclosure will help you reduce your interest outgo.

Current personal loan interest rates range from 11% to 24% per annum, in India. Since they are calculated on a loan to loan basis, they may vary for each lender and borrower. It is difficult to assign a single personal loan rate across lenders and borrowers. 

Compared to credit cards, personal loans charge lower rates of interest. Credit cards charge 2.5-3 % per month on the outstanding balance which works out to a whopping 24-36% on an annual basis. Personal loans are cheaper compared to this. You would be better off taking a personal loan for a specific expense than to keep running up a credit card debt and paying the minimum due every month.

This can damage your credit score and also lead to a vicious debt cycle. You are better off taking a personal loan for a specific reason, paying it off and then taking the next personal loan.

Using a credit card as an extension of your paycheck may lead to a situation of permanent debt which would not be a good situation to be in.

Personal loans are good to meet specific big-ticket expenses if you can plan them in advance. They are also good when you have an urgent need and you are short of funds. As long as you scout the market and compare the offers available, you can get yourself the best deal. 

Getting a personal loan from LoanTap is easy. If you are an Indian citizen or resident over the age of 21 years and earning a net monthly income over Rs 30,000 you can apply for a personal loan.

All you need to do is visit the LoanTap website and fill up an online application. You will need to upload the following documents –

  • PAN Card
  • Aadhaar Card/Driving Licence/Passport
  • Salary slips for the last three months
  • Bank statements of the salary account for the last six months

Once you submit this, you can wait for the LoanTap team to evaluate your application. If you have a decent credit score and you meet all the parameters for a loan, you have a high probability of getting your loan approved. Your loan will be disbursed to your account within 24-36 hours of your application.
You can choose from a range of flexible EMI options and pick the one that is suitable for your monthly budget. After six months, you can even repay the entire loan amount without any prepayment penalty. What are you waiting for? If you have any need for short term funds for any purpose whatsoever, you can just visit and we will be happy to guide you.

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