Yes Bank is a private commercial bank in India. The financial institution, founded in 2004, provides an array of financial services and products. Among its more popular products is the home loan owing to its flexible repayment tenure of up to 35 years. Naturally, several individuals opt for a housing loan from Yes Bank to fulfil their aspiration of becoming a homeowner.
However, even though a home loan is a convenient financial resort, it also involves a considerable monetary commitment. Thus, individuals may benefit from using the Yes Bank home loan calculator before availing a housing loan.
Prospective borrowers can compute the instalment they need to pay every month against their borrowings using the home loan calculator from Yes Bank. It’s an online tool, which individuals can use for free. To calculate the EMI, one needs to enter the loan amount, tenure, and rate of interest into the home loan calculator Yes Bank. Moreover, it also shows the total cost of the loan as well as the net payable amount.
EMI is the amount that borrowers need to pay every month towards the repayment of their loan until the entire quantum along with applicable interest is repaid. Yes Bank calculates the instalment amount based on the following industry-standard formula:
EMI = [P x R x (1 + R)^n] / [(1 + R)^n-1]
In this expression, R stands for interest rate divided by the number of instalments in a year, P denotes the loan amount, and n represents the maturity period in months. The Yes Bank home loan EMI calculator uses this formula to compute the instalment amount.
For better understanding, let’s take a look at an example –
Mr Kapoor has availed a home loan from Yes Bank to purchase a property in Delhi. The specifics of this are:
|Principal||Rs. 40 lakh|
|Repayment term||25 years|
|Rate of interest||10%|
As per the formula mentioned above, P = Rs. 40 lakh, R = 0.0083 (10%/100 x 12), and n = 300 months.
Hence, EMI = [40,00,000 x 0.0083 x (1 + 0.0083)^300] / [(1 + 0.0083)^(300 – 1)]
Or, EMI = Rs. 36,348
Therefore, Mr Kapoor will need to pay Rs. 36,348 every month to service a loan of Rs. 40 lakh for 25 years.
The repayment tenure a borrower opts for has a significant bearing on EMIs and also the total cost of a loan. A lengthy repayment term would reduce the EMI burden, but increase total interest payable. Conversely, individuals may need to pay higher EMIs if they choose a shorter tenure, but they can reduce the total interest outgo that way.
The quantum directly influences the EMI amount. If borrowers go for a high loan amount, they will also have to bear a proportionately increased EMI amount and vice versa.
The interest rate also has a crucial impact on the cost of a loan, and resultantly, the instalment amount.
Individuals can maximise their benefits from a home loan if they keep in mind these considerations when calculating their EMI using a Yes Bank home loan interest rate calculator.
Availing a home loan requires robust financial planning. While the process involves individual judiciousness primarily, the Yes Bank home loan calculator eases it by ensuring accuracy and simplicity.