What Does The Amortization Table In An EMI Calculator Mean?

The amortization table is a schedule of the repayments that you will make over the course of time. This is a detailed understanding of the EMIs, the principal amount repayment and the interest amount repayments for your loan. Let’s understand this concept in thorough detail.

What is an Amortization table?

This is a tabular view of your EMIs over the course of the home loan tenure. In simple terms, every EMI is divided into two parts – the principal and the interest amount. So, you can see how much of each month’s EMI is used for the principal as well as the interest amount. While calculating the monthly home loan EMIs, you can find the amortization table displayed in certain EMI calculators.

What is the main use of the Amortization table?

All housing loan EMI calculators in India do not host this table; although, the advanced ones do. The main use of this table is for the home loan calculations so that you understand the division of the principal amount and the interest amount over time. Most banks and housing finance companies create the repayment schedule that show the repayment of the principal amount over the course of time, while repaying small portions of the interest. Then, you will complete the term by repaying the interest, while paying the pending portion of the principal amount.

You can foresee how you will repay the loan on a month-to-month basis, which is a very useful insight into your financial life. It is, actually, more important as these amounts vary over time.

What are the other advantages of the table?

Since these amounts are also part of your tax rebate, you can use these numbers to calculate the tax benefit you can enjoy annually. Though you will need to consult a tax consultant, the tax rebate applicable on the principal amount and the interest is different. This table will be pretty useful, for sure.

The truth is; this table represents the standard repayment option. If you do not find it comfortable, there are several choices available today. So, take a look at your typical monthly expenses and pending savings over the years to find the most suitable repayment option. Though these details are not shown in the table, you can use a home loan calculator to identify any potential changes that you need to make.

So, use all these features of the perfect home loan EMI calculator and explore them to their fullest value before availing a housing loan.

What To Look Out For In Home Loan EMI Calculators?

When people need a good home loan EMI calculator , they just Google it and use the first one available. Yet, the truth is that there are several EMI calculators out there. Some offer just random numbers as the EMIs while a few others are in fact more helpful than these and show a much better picture with respect to EMI payments for the years to come. Here is how you can find out which one is suitable for you:

• Amortization table

This table shows the home loan EMI calculations in detail. It shows the EMIs, the principal amount, the interest amount and the total repay amount for the tenure of the home loan. Home loan calculations are much simpler when you have all these numbers in front of you. Your understanding of the EMIs, the principal amount and the interest is simplified to the greatest extent due to the invaluable details in this table.

• Impact of the major factors

When you are running numbers through the home loan EMI calculators in India , you realise how home loan rates fluctuations affect your EMI payments. You can see how a long term for repayment can lower your EMIs. The truth is; any variation in the principal amount, loan duration and interest rates can change your EMIs. Calculate your monthly home loan EMI by changing these factors so that your EMI is 30% of your income. Several financial experts advise this proportion as a healthy long term choice since it is much easier to maintain and repay, even if the interest rates escalate.

• Charts

Several advanced home loan EMI calculators in India show the ratio of the principal amount and the interest rates. With multiple calculations, you can make out how to optimize your earnings against your EMIs and also how much more interest you will need to pay by extending the tenure. You will certainly end up paying much more in interest than the principal amount.

When you check these details along with your EMIs, you gain a better understanding of the changes that you need to make. Yes, it simplifies things and speeds up the calculations. In spite of all these details and insights into your home loan, it is a tool though. Like any other tool, it can be used intelligently for the maximum benefit. However, it won’t replace research, the decisions that you need to make about the clauses, the terms and conditions, the repayment options, etc. So, use it well.

Five Considerations for Your Bad Credit Car Loan

A less than perfect credit score can sometimes be a barrier to even simple purchases such as a new car. There are many providers offering bad credit car loan solutions, which can provide a way to secure the finance needed. However, the range of bad credit loans can vary greatly and it is important to understand the considerations many lenders will assess on your application. This can affect whether you are approved and the type of rate you may be offered.

1. Bankruptcy:

Bankruptcy is a fact of life in tough economic times. However, although it is more common, you should be prepared that if you declared yourself bankrupt in the last twelve months, you may struggle to secure finance. Some lenders do specialise in providing loans to people with bankruptcy on their credit record. Therefore, it can be beneficial to find out the exact date of your bankruptcy declaration to determine if it is a good time to apply. If you are approaching your one year anniversary, it may be a good idea to speak to a specialist lender or broker to check their policies regarding those declared bankrupt. This could allow you to organise anything you may need but you should be prepared to be very forthcoming and open about your information.

2. Security:

Security provides reassurance for lenders of your financial intentions. Most lenders offering a bad credit car loan will require some form of security on loans over $3000. Usually, this is the vehicle itself, but the vehicle cannot be used to secure additional loans if it has already been used as security. Even if you are applying for a smaller amount, by offering a down payment or security, you may find that you are offered more competitive rates or terms.

3. Employment

Almost every lender will require some assurance that you have sufficient income to cover the cost of the loan. Some lenders may allow for self employed people to self certify their income if they have no records or books to prove their income. However, when a poor credit rating is involved, lenders usually require more assurance that you are financially able to meet the monthly repayments. Many lenders will require copies of pay stubs or bank statements to show you have sufficient income. Certain forms of pensions, youth allowances or study grants are unlikely to be acceptable forms of income.

4. Documentation:

In many cases, lenders will require documentation such as copy bank statements. This is usually the statements for the last one to three months. The lender will be looking at if the account is in good standing, not going over drawn or having unauthorised borrowing charges imposed. They will also check if an amount of pay is being deposited regularly and if the servicing of any payments or debts matches the information you have provided. Red flags for lenders include direct debits to lenders you have not mentioned on your application, frequent withdrawals from inappropriate organisations such as gambling sites, and unauthorised borrowing.

5. Applications:

You should also be aware that applying for multiple loans can have a very damaging effect on your credit rating. While it can be a good idea to research your options, don’t submit an application with multiple lenders. This will show on your credit report and discourage any potential lenders.

If you need assistance with a bad credit car loan, contact us. We are a broker with access to bad credit specialist lenders and would be happy to help you.

Interest Rates Comparison To Find The Right Fixed Deposits

Traditionally speaking, most investors considered identifying the right fixed deposit to be as easy as visiting a bank and opening an account. With the current economy, most banks compete with each other for your money. So, they offer the best interest rates they can. It won’t be as easy as visiting a third party website to check out all the interest rates though. If you do visit these websites, you can find the bank that offers the highest interest rate on the fixed deposit schemes . There are a few other considerations too, that are important for savvy investors.

Organization

There are several organizations that offer fixed deposits today. All nationalized, cooperative, private and foreign banks, select mutual funds, select companies and the Indian postal service offer term deposits. So, you should evaluate all these organizations to select the best one possible. Company FDs have higher returns and an even higher risk, just like cooperative bank FDs. Nationalized banks and the Indian Post offer higher safety and lower returns. Hence, evaluate all these options based on your investment agenda.

Investment agenda

For investors looking for a high yield, FDs are not the ideal choice. You must invest funds as per your agenda so as to choose the right investment tool, organization and amount. The most popular reasons for investing in low risk and low gain tools like the FD are:

• To earn interest
• To maintain liquid assets
• To have spare cash for an emergency like an accident or a surgery
• To diversify the investments
• To invest for a certain long term objective such as a gift for a minor

Specifications:

Based on your agenda, you can narrow down the specifics to look out for in the fixed deposit options. For example: If you want to save some extra cash for an emergency, you can read up on the premature and partial withdrawal penalty. If you want to diversify your investments, then you won’t invest the entire sum in one organization. Company FDs and fixed deposits in banks can make a great choice. You can’t invest anything more than 1 lakh rupees in any bank, though, as this is the maximum limit of insurance on these term deposits.

If you have chosen your specifications well, you can end up with the best possible investment. While this process may seem a bit complicated when compared to just choosing the highest interest, the result can certainly be a useful investment for you.