Use BankBazaar Personal loan EMI calculator to calculate your EMI beforehand to plan and manage your finances in a better way. Personal Loan calculator lets you check your loan eligibility and helps you compare loans offered by different banks.

All you need to do is enter the loan details, including your preferred loan amount, interest rate, tenure, and processing fee. Hit “Calculate” to check your EMI.

The result is followed by an amortisation table, which will give you a detailed break-up of your repayment schedule.

Personal Loan Fees and Charges

The following are the charges and fees of the personal loans available from various institutions.

• Processing fee
• Goods and Services Tax (GST)
• Verification charges
• Charges levied for issuing duplicate statement
• Penalty for defaults
• Penalty for pre-payment and part payment of loan

In addition to these, the lenders might also levy charges for documentation, stamping, credit administration, collection, and so on. The levy and the rates of these fees and charges differ from lender to lender. However, you can check the fees and charges which are levied by the top lenders in India before you apply for a personal loan.

Pre-Payment and Part Payment in Personal Loan

A personal loan is given for a stipulated time period. This period is known as the loan repayment tenure. After you have taken a loan, you are expected to pay the debt off by the end of the loan repayment tenure through EMIs. However, after availing a loan, if you decide to pay off your debt before the end of the loan repayment period, it is called pre-payment or foreclosure.

Types of Pre-Payment:

There are 2 types of pre-payment. They are full pre-payment and part pre-payment and part payment.

1. Full Pre-Payment:

If you are paying off the whole outstanding loan amount before the end of the loan repayment tenure, it is known as full pre-payment.

Advantages of full Pre-Payment:

• You can avoid paying hefty interest on your loan amount.
• If you have the money to pay off your debt completely, you might as well get rid of the debt.
• You can avoid paying pre-payment interest as well, if you have taken the loan from a lender who does not charge an interest on pre-payment of the loan.

Disadvantages of Full Pre-Payment:

• If your lender charges a penalty on pre-payment of the loan amount, you might have to pay a big chunk of money for pre-paying your loan.
• Before you foreclose a loan, check the other factors related to it. Foreclosing a personal loan means that you would be paying out a huge sum of money at once. This might not always be the best option.

2. Part Pre-Payment:

If you are paying off a part of the outstanding loan amount before the end of the loan repayment tenure, it is known as part pre-payment.

Advantages of Part Pre-Payment:

• You can choose to pay off a part of your outstanding loan amount if you have some readily available money.
• Part paying your loan will reduce the outstanding principal amount which, in turn, will reduce the effective EMI amount.
• The overall interest that you pay will also reduce significantly.

Disadvantages of Part Pre-Payment:

• If you do not make the part payment soon enough, you will not be able to maximize your savings.
• If your lender charges a fee for part payment of personal loans, you might have to spend a significant amount of money for the same.

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Modes of Loan Payment or Repayment

There are a number of repayment modes which are offered by lenders. Although these modes might differ from lender to lender, the most common modes of repayment can be summed up as follows:

1. Electronic Clearance System (ECS): The ECS or Electronic Clearance System is one of the most commonly used repayment methods. It is an electronic mode through which funds are transferred from one bank to another.
2. Post Dated Cheques (PDCs): Post Dated Cheques, as the name suggests, are cheques which are issued by you for a future date. The lender will use these cheques on the mentioned date to deposit or encash the amount mentioned on it.
3. National Automated Clearing House: The National Payment Corporation of India (NPCI) offers a program called NACH to all the banks and financial institutions. The NACH allows the processing of transactions in real time. This method can be used for your loan repayments.
4. Debit Mandate or Standing Instruction: You can give an instruction to your bank to pay off a particular amount of money to another bank or bank account at a regular interval. This is known as standing instruction or debit mandate. Your bank will be paying off the stipulated amount towards the repayment of your loan on a regular basis through this system.

Courtesy To Bankbazzar

About Post Author

Lynn Jackson

aware@srvibes.com

http://www.srvibes.com

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