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**home loan emi calculator**initially just a sheet of paper with all the calculations, has today found its way as an online tool found on the websites of every financial institution. It is a tool that assists people in finding out the EMI per month by varying the loan tenure, the loan amount, and the rate of interest. And these three factors are the most important when it comes to taking a loan. By altering even one of them, you can make a significant difference to your loan repayment.

Loan Amount Loan amount is the amount of money that you’ll borrow from the bank. Usually, banks give up to 80% of the total value of your home as loan. The rest 20% has to be given by you. This 80% is usually the maximum limit banks can offer, and it depends on your financial standing. If your income statement is convincing enough, you can get a good loan amount. If not, then you might get anywhere below 80%!

By arranging for more down payments, you can bring down your loan amount. A lower loan amount eases repayment.

Loan Tenure Loan Tenure is the amount of time you’ve selected for repayment. Some people select 5 years, some 10 years, and some even 20 years. Lower the loan tenure more will be the EMI per month. However, higher the tenure, then more will be the interest. The former situation is preferable.

For example, consider a situation where you’ve borrowed 50 lakhs from the bank at an interest of 10% per annum. If your tenure is 5 years, you will end up paying 25 lakh in interest. Therefore you will pay Rs. 25 lakh plus the principal sum of 50 lakh, i.e. Rs. 75 lakh to the bank. On the other hand, if your tenure is 10 years, then you will end up paying Rs. 50 lakhs as interest, and Rs. 50 lakh of the principal amount, which brings the total to Rs. 1 crore!

Rate of Interest Rate of interest varies from bank to bank. Every

**financial advisor**says that should ideally select a financial institution that offers you a lower rate of interest. As seen above, interest can cost you a huge amount of money every year. Even an interest difference of 1% can save lakhs of rupees every year.