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How Does a Bank Calculate Interest on Your Fixed Deposit?

A fixed deposit is a simple and safe investment. It only requires a one-time deposit. You can deposit a sum known as the “principal” with a bank for a set period. You will receive your deposit plus interest at the end. No matter how interest rates move, or how the economy performs, you will get fixed returns when investing. This helps you collect a large amount with ease. What is a fixed deposit? Banks offer fixed deposits (FDs), a type of investment product. In this type of investment, investors put in a fixed amount of capital at a fixed interest rate for a fixed period. When the fixed deposit matures, the bank returns the principal amount and the interest earned. Fixed deposits pay a higher interest rate than other products, such as savings accounts. You can put money into a fixed deposit for a period ranging from 7 days to 10 years. Anyone with a bank account can open an FD with a minimum deposit of Rs. 1,000. The minimum time frame is seven days. How does a Bank Calculate Fixed Deposit Interest? Bank Calculates Interest on Fixed Deposit: Simple and compound interest are the two methods for calculating interest on a fixed deposit. Banks may use either, depending on the deposit’s tenure and size. Simple Interest - This method is simple. It is computed by multiplying the principal, interest rate, and period. “principal x rate of interest x time period divided by 100” or “P x Rx T/100.” Where, P = principal amount; R = annual interest rate T is the number of periods. For example, if you invest Rs. 10,000 at 8% p.a. for 5 years, the interest can be calculated as follows: Step 1: 10,000 times 8 times 5 equals Rs. 4,000,000. Step 2: Divide that number by 100. You will be paid Rs. 4,000. So, after 5 years, you will have earned Rs. 4,000 in interest. As a result, if you invest Rs. 10,000 in a fixed deposit paying 8% p.a. simple interest over 5 years, you will receive Rs. 14,000 back. Compound Interest - In this method, you earn interest on both the principal and the interest. Many banks offer compound to calculate interest on fixed deposits, but you should shop around to ensure you get a good rate. For example, suppose a bank offers 8% p.a. on a 5-year deposit with annual compounding. So, if you invest Rs. 10,000, the interest can be calculated as follows: In the first year, we employ the simple interest method. 10,000x8x1/100 = Rs.800 So, the first year’s interest is Rs. 800. This sum is returned to the principal. As a result, the second-year principal’s salary is Rs. 10,800. We can now compute the compound interest for the next three years in this manner. Calculate Interest Fixed Deposits Using the fixed deposit calculator While the formulas are direct and can be used by banks to calculate the fixed deposit yield interest rate, they are technical calculations. As a result, fixed deposit calculators are available to assist you in correctly and easily calculating the possible interest. The fixed deposit calculator is an online tool. You must enter the deposit amount, the deposit tenure, and the interest rate. The calculator then calculates the interest rate on the deposit and the amount due at maturity. You can also adjust the deposit amount to see how the interest earnings change. The formula for calculating the final amount using a compound interest rate is as follows: A=P [1+(r/12)/100)] N Where: The amount at the end of the investing period is denoted by A. P is the initial investment amount. R: annualised interest rate, for example, 6, 6.5, or 7. N: Is the investment tenure Conclusion A fixed deposit is an investment scheme. You deposit a lump-sum amount with a bank or financial institution for a specific period. As a reward for this lump sum, you will receive a certain percentage of interest. At the end of the fixed period, the financial institution returns your principal investment amount and the interest earned up to that point. Fixed deposits are generally considered far safer than other types of investments. Fixed deposits have low default risk. However, the default risk is not non-existent. You risk losing your investment capital if you invest in low-rated fixed deposits. [B-02] FAQs What is the definition of compound interest? What is the compound interest formula for a fixed deposit? Fixed-Deposit Compound Interest Compound interest is interest earned on both the principal and interest earned. The interest rate is increased in proportion to the number of periods (years) for which the interest will be compounded and multiplied by the principal amount invested. Calculate interest on FD using compound interest P (1 + r/n) (n * t) A “A stands for maturity amount. P denotes the principal invested. R = The interest rate (in decimals) N is the number of compounds that occur in a year. T denotes the number of years. What is the minimum term for which a fixed deposit can be held? Customers can invest their money for as little as 7 days and as much as 10 years. What are the drawbacks of a fixed deposit? Fixed deposits have drawbacks.Lower interest rates No interest increasesInflation can cause interest rates to fall.

08-11-2023

Personal Loan

How to Get a Personal Loan with Lowest Interest Rate?

A Personal Loan with Lowest Interest Rate can help a person in many emergencies and needful situations such as medical emergencies, financial emergencies, buying a house or car, planning a wedding, taking a vacation, paying debts, etc. – a personal loan does not have defined rules before taking the loan, it can be taken to fulfil any requirement of the person in need. The bank providing this loan pays more attention to whether that person can repay the loan. A loan’s interest rate depends on the person’s credit score or previous loan repayment history. Though the central bank often determines the personal loan interest rate, reasons like a bad credit score can boost the interest rate. That is why a person must follow certain habits before taking a personal loan, so they don’t have to pay high interest. By practising the below-mentioned tips, one can get a https://www.piramalfinance.com/personal-loan. [B-01] What is an interest rate? Interest rate is a rate that is determined according to the money borrowed or invested. The interest has to be paid over a certain period. The overall interest rate depends on the initial amount borrowed, the duration chosen to repay the debt, EMI, and the fixed interest rate. There are many types of interest rates. So, a person who talks with the manager before taking a Personal Loan with Lowest Interest Rate must calculate the amount to be paid as interest and make plans accordingly. A high-interest rate can be avoided by calculating the interest beforehand. What are all the factors affecting the interest rate? The central bank usually fixes an interest rate. It varies for different types of loans and durations. But other factors can influence the interest rate set by the government. A person’s credit score is one of the critical factors that will be noted before approving the loan. A lower credit score can increase the interest rate of the borrower. Other factors that need to be considered include employment status, the amount borrowed, previous loan history, duration of the loan, etc.; sticking with these factors, one can achieve the Personal Loan with Lowest Interest Rate. Key Points to follow to get a lower interest rate Credit score to score lower interest rate. A credit score is calculated by analysing how likely a person will repay the money using previous credit records. It determines how worthy the borrower is of a loan. There are different models to calculate credit scores. Typical credit score ranges between 300 and 850. But generally, a credit score above 750 is considered a good credit score to approve a loan. This indicates that the person has a good record of paying loans, fewer debts to pay off, and has an active account. All these factors are taken in differently while calculating the credit score. The higher a credit score is lower the interest that needs to be paid. Employment status. Another critical factor noted by the bank before offering loans is employment status. This plays an even more important role when applying for personal loans. Since there is no responsibility for a personal loan, the bank takes it essential that the person applying for a loan has a job or a source of income to repay the loan later. Therefore, an employed person is likely to get a Personal Loan with Lowest Interest Rate. The type of employment is whether the person is self-employed or working in a private or public sector. All these are factored in while assigning the rate of interest. Previous loan history. Every bank will go through the loan history of a person before providing a new Personal Loan with Lowest Interest Rate. This is true even if the person is applying to a different bank for a loan while having a bad loan repayment record in another bank. If one has a list of loans or debts to be paid, that is not considered a good situation to lower the interest rate. This behaviour suggests the person might not pay the loan back in time. Thus, one expecting a low personal loan interest rate should avoid debt. And maintaining a good loan repayment history is a bonus to be considered for low-interest rates. Compare different lenders. There are many requirements a person should qualify for before getting approved for a loan. Similarly, the person should compare different banks, loan records, and offers before choosing the ideal one. Foreign banks can consider other factors while approving a Personal Loan with Lowest Interest Rate. The services, level of fees, and interest rate will also vary at large. Suppose one has met the eligibility to get approved for a loan. In that case, they can refer to a financial institution or a website to compare them and understand how to pick the best bank to offer them a lower interest rate. Watch out for offers. One should apply for a loan with offers to get a lower interest rate. Banks provide offers to attract new customers and encourage old customers to apply for new loans. A person who wants lower-interest-rate should always wait for offer periods before applying for a personal loan. The offer period is when the bank is flexible with factors that must be met before approving a loan. So, to attain a Personal Loan with Lowest Interest Rate, look for offers from different banks. [B-02] Conclusion: Getting a Personal Loan with Lowest Interest Rate is not that difficult when the borrower follows the tips mentioned above. An important point to remember while applying for a loan is to contact sound financial institutions like Piramal Finance. You can avail of various loans at great interest rates.

08-11-2023

Personal Loan

How to Finance Home Renovation Using a Personal Loan?

Often, one would like to make some changes in their home. It can be anything like changing colour, getting expensive furniture or many more. From time to time, one would want to change the look of their house. If in an Indian family, then during celebrations or festivals, it is a general notion to change the look of one’s house. After this is noted, the festivals in themselves have a cost implication. So, renovating on a tight budget is not a great plan. This would affect the quality of the renovation. This is the reason personal loans for home renovation are taking over the market. [B-01] What Does One Mean by a Home Renovation Loan? A home improvement or renovation loan is a type of unsecured loan. This means that no security or collateral is needed for these types of loans. This is different from a mortgage loan or housing loan. That is why no deed of one’s home is required. Mostly, a personal loan for a home renovation can be repaid without much problem. One gets to repay it in monthly instalments, i.e., EMI. The period can vary between 12 months to 60 months. The EMI is decided based on many factors. The principal amount is one factor, processing fee and rate of interest are the others. If the person fails to repay the money within the given time, then a penalty is levied. A person can also choose to close the loan before the completion of tenure. But some banks and agencies charge a penalty for that. It is essential to read the fine print before opting for any personal loan for home renovation. What are the Eligibility Criteria for a Loan Application? Should be a citizen and resident of India. The age bracket should be between 21 years to 60 years. Needs to be either salaried or self-employed to apply for a personal loan for home renovation. The credit score should be good. Preferably above 750. Why Should a Person go for a Personal Loan for Home Renovation? There are several options with the help of which one can finance their renovation goals. A credit card is an excellent option for a person who aims to achieve short-term renovation goals. But then, credit cards do not offer the stability that a person provides. The home improvement loan offers a much lower APR than credit cards. It also ensures that there are no fluctuations in EMI during repayment. But most renovation plans are high budget. So, a personal loan for home renovation serves the purpose most accurately. The amount gets disbursed to one’s bank account. For petty expenses, one uses a personal loan to give cash payments. This loan also adds to the property value. Here is how: Property value helps to increase with home renovation: No matter if a person plans to sell their place or continue using it. This renovation helps one to increase the value of the property. Real estate prices are rising, so renovating it would get one great deal. For maintenance, the renovation of a home is a must: All types of houses need maintenance. If taken care of at regular intervals, one can avoid the massive problem in the future. What are the Benefits of This Loan? One can opt for a collateral-free loan: This being unsecured, does not need any type of security or collateral. The application process is simple: Today, almost all personal loan for home renovation provides an online form fill-up facility. This hardly takes 15 minutes. Even uploading documents and verification have been digitalised. With this, the application gets approved quite fast. The approval and disbursement can take as less as 24 hours. Unexpected expenses can be taken care of as it gets tough to provide an extra amount when needed during renovation. And it is impossible to know exactly how much would be spent on the entire process. Mainly one can have a rough estimation of the expense. So, when the renovation starts, one needs to be prepared for unforeseen costs. If a person has taken a loan, they need not worry as the loan amount will cover all those expenses. Loan details can be tracked online: Almost all the loan information can be accessed online. One is provided with a set of login details that stay unique. With the help of that, the person can track their loan. How Can One Apply for a Loan? The application form needs to be filled out. The loan amount needs to be selected. Necessary documents are to be submitted: KYC documents, i.e., address and ID proofs. Salary slips for salaried persons. Financial statement and audited income for a self-employed person. Statement of bank accounts for the past 3 months. Employee ID for salaried person. Business proof is needed for a self-employed person. Now the loan gets approved, and the amount is disbursed. [B-02] Conclusion Home renovation is a dream project for many. Unsurprisingly, One would want to take great care in renovating their house. In such a case, no one would want to face any financial problems and compromise the outcome. A Personal loan for the home renovation is the best option in such a situation. Banks and many financial agencies provide this facility. If a person is looking for a financial option then “Piramal Finance” is a good personal loan/financing option for buyers.

08-11-2023

Mutual Funds

Use SIP Calculator to Calculate Returns on a SIP Investment in 2022

SIP stands for Systematic Investment Planning. It is an investment approach that is disciplined. With the help of the SIP route, one can invest a fixed amount in mutual funds at a specified interval. The intervals can be semi-annual, quarterly and monthly basis. There is a facility for auto-debit techniques. This would automatically transfer the amount to the fund from one’s bank account. One need not take any stress – the decent amount gets shared on the designated date. This helps one with not missing any dates. One can create long-term wealth with the help of SIP. This investment is reoccurring in nature. It would help one to develop the habit of savings. It is not unknown that the financial market is volatile. So, it saves one from that uncertainty. One can calculate the return with a SIP calculator. [B-01] What are the different kinds of SIP? Top-up SIP: This Systematic Investment Planning helps one to change the amount of their instalment. One can change the fixed amount at a pre-defined interval. Flexible SIP: Until now, SIP means to invest a certain amount in a mutual fund in an organised manner. But there can be situations in which one might not be able to pay the same amount every month. In such a case, one can choose a flexible SIP. One has the liberty of altering monthly investments depending on cash flow. If facing any financial crunch, one can reduce the SIP amount. If there is high cash flow at any month, one can invest depending on that. Perpetual SIP: Investors would generally be inclined to invest in a mutual fund with a fixed period. There are different spans of tenure. It can be ten years, five years, three years or 6 months. But it can be so that one does not want to have any fixed end date. This can be achieved if one chooses perpetual SIP. With this, one can invest in their fund for as long as they want. One needs to provide clear instructions to AMC so that they cease it. The amount can be redeemed by one when the desired corpus is reached. What is a SIP calculator? The SIP calculator is a straightforward tool. This helps a person to have a clear idea about the returns of their mutual fund’s investment made by SIP. This method of investment is quite common among millennials these days. The mutual fund’s SIP calculator is specifically designed to help investors know about the investment estimate. Many factors depend on which the actual value of the investment can vary. But one will not be able to have a clear idea of the expense ratio and exit loan. One will learn about the wealth gain and the expected return for SIP investment. One can get a rough idea of the monthly SIP. It would be based on the projected annual rate return. How does a SIP calculator help one? Many experts say that SIP is one of the most lucrative ways of investment. This creates a financial discipline in one. It also helps create a good habit of savings that would benefit one in the long run. The SIP calculator is a very beneficial tool. One could get an estimate of the return one would get after investment tenure. Few benefits of the SIP calculator: Helps one to determine the required amount that they want to invest. It would help one to know the total amount that one had to invest. This provides an estimated value of the return. How does a SIP calculator work? There is a formula depending on which SIP calculator works. The formula is: M = P × ({[1 + I] n – 1} / I) × (1 + I). Where: M means the amount one receives on maturity. P refers to the amount one invests at every regular interval. n refers to the total no. of payments that have been made. I refer to the periodic rate of interest. Market conditions play a vital role in fixing the interest rate of SIP. It may either decrease or increase, which would affect the estimated return. What are the benefits of SIP? Averaging of rupee cost: SIP makes sure that when the market is low, one buys more funds, and when it’s high, then fewer funds are accepted. The power of compounding: Compounding means earning income on the principal investment and earned income. It is simple to invest: The process of investing with the help of SIP is quite simple. It is the ideal tool for financial planning: When someone invests steadily every month, they can fulfil their financial goals. It can be both short term like travelling or long-term, like building the dream house for oneself. [B-02] Conclusion As per the research, SIP investment is quite popular these days. It is one of the best investment options. One gets to invest in mutual funds with the help of SIP. The investments are made of a fixed amount and at a specified interval. The SIP calculator is a great financial tool. It helps one to know the returns they will get from their investment. One can get these calculators all over the internet. They give excellent results; one could calculate such things in a fraction of a second. If a person needs any financial option, then “Piramal Finance” is an excellent personal loan/financing option for buyers. They also have great blogs that one can read if one needs them.

08-11-2023

Personal Loan

Important Things to Consider Before Borrowing A Personal Loan

What is the definition of a Personal Loan? A personal loan is an unsecured loan that does not need any collateral. It needs little documentation. That means a borrower is not required to put up any of their assets as collateral. If you’ve decided that a personal loan is the best option, crunch the numbers to see if you can afford to go into debt. The higher your score, the better your chances are of getting approval and securing a lower rate. Personal loans are convenient ways to meet your short-term financial needs. Personal loans are much easier to obtain than car or home loans. Here, lenders do not require collateral. Because personal loans are unsecured, lenders take a higher risk when providing them to customers, which is why the interest rates on personal loans are higher than those on home loans or car loans. [B-01] Here are some things to think about if you want to get an instant personal loan: Know the Exact Borrowing Amount: The applicant must know how much money he or she requires. When you tell the exact amount, the bank is much more likely to sanction the loan than if the borrower is unsure of how much money he or she needs. Identify other Loan Options: Personal Loans are not always the only way to get out of a jam. You might consider asking family and friends for a loan if the amount is small. This clears the hassle of paying interest rates. Even if you pay them more, you will not incur any prepayment penalties. The Reason for taking the Loan: Tell about the reason for taking the loan along with the amount. The fact that the bank must decide whether to lend or not, for whatever reason, gives them an idea of the level of risk they are taking by offering you funds. You appear more authentic. Choose an affordable EMI: Before you take out a loan, make sure you will be able to make regular payments. It is without incurring any penalties. Make an estimate to fix how much loan EMI you can pay. Show the Spending Pattern if taken for Business Purposes: Personal loans are used by firms to start new firms or to buy new assets for an existing firm. Also, salaried individuals to meet financial needs. When you inform the bank of your intention to buy an asset that will generate higher returns in the future, the bank is delighted. So, if you appear to be a good candidate with a good CIBIL score, the lender may approve your loan with flexible EMI repayments. Repayment Flexibility: Banks offer various repayment plans for personal loans. A long tenure would need the payment of higher interest rates. Banks charge a fee to close the loan if you want to pay early or fail to pay on time. You must consider repayment flexibility to avoid incurring enormous costs. Possibility of Repaying EMI every month: The actual EMI will be fixed by the loan’s term. A long tenure will result in lower EMIs, and vice versa. A long tenure results in higher interest. It will increase your total loan-availing cost. This is because interest is calculated on the total amount to be repaid. Thus, plan to fix which EMI scheme is best for you. Other Fees or Charges: Banks charge a small fee when granting loans. A bank may levy various fees, such as prepayment penalties, late fees, cancellation penalties, processing fees, cheque bounce penalties, etc. Compare the fees charged by some of the best banks that offer low-interest loans. Shop around for a Good Loan Offer: This is one of the most overlooked steps for people looking for a loan. Personal loans are available from various banks, not only the ones where you have an account. Consider the bank that offers the best terms and the lowest interest rates. Most banks have similar terms. But there may be variations. Some banks charge fewer penalties and have friendlier terms. As a result, before deciding on a lender, do your homework. Interest Rates: Compare the interest rates of various banks that you find reliable enough to receive credit from. Though we would prefer a bank with lower interest rates, it is vital to first read the terms and conditions to avoid incurring costs in the future. The best way to do this is to check the bank’s official website for personal loan offers and interest rates. Conclusion Personal Loans have always been popular because of how they can be obtained with no collateral required. The availability of online services has accelerated this. Personal loans are very easy to get. Because they are unsecured, they have significantly higher interest rates than other loans. It is important to consider certain factors before taking out a personal loan to do what is best for you. I hope this article helped you make future financial decisions. Read on to learn more about finances at: https://www.piramalfinance.com/ [B-02] FAQs How can I apply for a personal loan? A good credit history increases your chances of getting a personal loan and a lower interest rate. Some lenders offer both good and bad credit loans. When evaluating applicants, some lenders also prioritise alternative data, not on your credit report, such as education, occupation, and where you live. Do I have to provide any security? This is an unsecured loan, not a secured loan. There is no need for any kind of security or guarantee. How long does it take to get a consolidation loan approved? The majority of debt consolidation loans are approved within a day or two. Getting a debt consolidation loan becomes even simpler if you meet all the eligibility needs and your record is flawless.

08-11-2023

Personal Loan

Personal Loan Prepayment Calculator Benefits and Steps to Use

The value of EMI is fixed at the time of buying. It is paid every month. This is to ease the burden on the borrower. You can, however, pay off loans ahead of schedule. This is a prepayment of loans. We can also call it “payment in advance.” People use this to pay on time. It can be useful in many ways. Its amount can be calculated using a personal loan prepayment calculator. Let’s discuss this in detail. When people pay EMI, they pay interest. There is a fixed interest to be paid. It has to give every month with EMI. But sometimes, people want to ease the problems. If they have lump sum money, they can use it. It can be used to repay the loan amount. It can reduce the total amount. In turn, it reduces interest. So, the prepayment of loans minimises the burden on people. The amount for prepayment is calculated before paying. It is done by using a personal loan prepayment calculator. It is effortless to use. [B-01] Steps To Use A Personal Loan Prepayment Calculator Using the personal loan prepayment calculator is easy. Follow these simple steps: Enter the principal loan amount. Enter the current rate of interest. Mention the original term of the loan. Verify the number of EMIs paid. You will see the amount that is due. Enter the prepayment amount. Click OK. The screen will display the amount paid. It will also mention the amount left. The period and EMI will change. The new period and EMI will be visible on the screen. In the prepayment of loans, different cases can arise. These includes Case 1: Full prepayment This is for the people who want to pay the amount completely. It includes paying every penny left. It is called foreclosure. You can do it if you become eligible to pay the entire amount. It saves you from interest. This method saves a lot of money. But it requires paying a lump sum all at once. A specific amount is paid in this. That amount is called the foreclosure amount. Case 2: Partial prepayment once It means paying a partial lump sum at once. It shortens the repayment period by lowering the principal amount. And less interest to be paid. This amount can be calculated using a personal loan prepayment calculator. It is effortless to use. Fill in all the blanks. Get a new loan period and EMI. The EMI can also be varied. This helps people in many ways. It can reduce the burden of EMI as the remaining balance is reduced. Case 3: Partial monthly prepayment It means paying in advance every month. It also reduces the overall period of the loan. This amount can also be calculated using a prepayment calculator. The user can decide the extra amount to be paid. All the values are to be put in the prepayment calculator. A new EMI is generated. It is user-friendly and easy to use. People can use it if they want to increase their monthly repayment. This helps them pay off loans on time. Above, we discussed three cases regarding repayment. The amount for all three is differently calculated. A personal loan prepayment calculator can easily calculate it. This calculator is beneficial and easy to use. Anyone can easily use it for calculations. The only work to be done is to input the correct values. All analyses are carried out by the calculator. There is no chance of error. Piramal Finance offers ZERO charges on Personal Loan Pre Payment. Benefits Of Using A Personal Loan Prepayment Calculator There are many benefits to using a personal loan prepayment calculator. Some of these are: Easy to Use: This calculator is easy to use. No special knowledge is required. Anyone with little financial knowledge can easily use it. Also, no special work is to be done. The only task at hand is to assign values. Even a kid can operate it. It is readily available online. There is no need for offline work. No Errors: The calculations on this calculator have no errors. Since it is software, there is no chance of error in the calculations. This can make your work easy. It can provide you with error-free results. This can also help with proper planning. This can help people save time. Lesser Interest: Prepaying loans has a lot of benefits. Reduced interest tops the list. The prepayment of the amount reduces the principal amount. This, in turn, reduces interest. It saves money. Interest is a burden on people. Prepaying loans can reduce it. Interest adds up to increase the principal amount. The amount to be paid back is much more than the loan taken. It is paid in EMI, but it’s still tricky. However, prepaying reduces the burden. A personal loan prepayment calculator can calculate this amount. It also shows detailed values for interest and period. Hence, it is advantageous. Time Management: The personal loan prepayment calculator can help manage time. Prepaying loans reduces the overall period. This requires planning. You can be free of debt easily. You can calculate the prepayment amount according to your comfort. It is an easy process. It does not require offline work. You can do it yourself. In turn, this saves a lot of time. Also, when you are free from debt early, you can focus on other things. Practical Approach to Life: This can give someone a practical approach to life. A definite amount can motivate you to save money. You can plan for the future. Keeping in mind the occasions, the prepayment amount can be changed. You can make partial prepayments. [B-02] CONCLUSION Using a personal loan prepayment calculator is very easy. Prepaying your loans also has a lot of benefits. It is easy and friendly. This can reduce the burden on people and help them understand time management.

08-11-2023

Personal Loan

What Are the Steps to Calculating a Car Loan?

The cost of borrowing money to buy a car is referred to as auto loan interest or Car Loan interest. The lender will base its interest rate on your credit score, debt-to-income ratio, and other factors. To create your budget, you should know your interest rate and how much money goes toward your monthly loan balance. Car Loan EMI includes the principal and interest payments on your car loan. The amount, rate of interest, and period primarily determine the EMI. The longer the period, the lower the EMI, but you will pay more interest to your lender. [B-01] What Do Auto Loan Calculation Formulas Include? The key factors in the calculator for a car loan are the interest rate, loan size, and loan term. A larger loan will result in a higher monthly payment. A smaller loan will result in lower payments. Higher interest rates result in higher monthly payments than lower interest rates. A loan with a shorter term will have a higher monthly payment than a loan with a longer term. When looking for the right loan for your monthly budget, you can adjust these three factors to find the best balance for your needs. Car Loan EMI Calculation Methods You can calculate the EMIs on your car loan in two ways: online or manually. Method 1: Using an Online EMI Calculator for Car Loans Visit the lending institution’s car loan EMI calculator page. The monthly EMI you must pay will be displayed instantly after entering the information mentioned above. Method number 2: Use a manual EMI Calculator for Car Loans This is the formula for a calculator for a car loan: E = [(1 + R) N – 1] [(P x R x (1+ R) N)] where E denotes Equated Monthly Instalment, P is the principal loan amount, R is the interest rate, and N the number of months These three variables are changeable. This means that the EMI value will change whenever one of the three variables is changed. The following are the five advantages of using an EMI calculator for a car loan : Simple to use Quick results It saves time and energy that would have been spent on manual calculations. It assists you in determining how much your car loan EMI will be. Advantages of a Car Loan Flexibility in choosing a tenure Car loans are available for terms of up to seven years. This gives you the freedom to plan your finances and the convenience of choosing the tenure of your choice. Secured Loan Because a car loan is a secured loan, you are not required to mortgage your existing assets (secured against the car itself). Meaning until the loan is fully repaid, the lending institution or bank has a lien on the asset, giving it the authority to seize the asset and recover the debt by selling the vehicle. Loan Payment Options You can pay with post-dated checks or by auto-debit. Your EMI will be deducted automatically from your bank account. This will be when you use the auto-debit feature. Conclusion A car loan is a type of credit product offered by banks and other lenders. It allows you to finance the purchase of a car with a low down payment. The loan can be repaid in EMIs over time at an agreed-upon interest rate. Before applying for a loan, the car loan EMI must be calculated. A car loan calculator can assist you in calculating the EMI and interest payable on a financed vehicle. India is now the world’s fourth-largest market for four-wheelers. The figure demonstrates how car demand has risen over time. Many people desire a personal car, but the cost impedes purchase. A car loan can help you pay a low down payment and easily get your dream car. The remaining balance can be paid monthly at an agreed-upon interest rate. Dive into Piramal Finance articles for more such finance-related subjects here: [B-02] FAQs What If I Can’t Pay My Car Loan EMI? When taking out a loan, make sure you can repay it. Failure to do so will result in substantial fines from the lender. Your credit score will also suffer as a result. Suppose you are unable to repay the loan due to unforeseeable circumstances. In that case, you must notify the lender as soon as possible so options such as moratoria or a longer repayment period can be considered. What Is The Required Down Payment On A Car? Generally, the minimum down payment for a car loan is 10% of the car’s on-road price. This is because most lenders offer 90%, if not 100%, of the vehicle’s on-road price. However, if you make a substantial down payment, you will require a lower loan amount. Your monthly EMIs and interest rate will also be low. What factors influence your car loan EMI? Loan amount Interest rate Loan tenure Rest period once a month What exactly is EMI? The Equated Monthly Instalment (or EMI) is made up of the loan principal and interest. As a result, the EMI equals the principal amount plus the interest paid on the car loan. The EMI is usually fixed for the entire loan term and is repaid.

08-11-2023

Personal Loan

Great Festive Loan Offers to Make your Diwali Memorable

Diwali is one of the most important festivals in India. It is known as the “festival of lights.” It is celebrated all over the country. The Diwali celebration is nothing less than extravagant. As Diwali approaches, there are many offers from banks, nonbanking financial companies, and housing financing companies, such as the festive loan offers. October is undoubtedly the month of festivals. People start celebrating from the onset of the month. As people start spending, buying things, hosting parties, etc., banks look forward to the adequate capitalisation of this spending spree. Festive loan offers enable customers to increase their spending power. Festive loan offers are given at lower interest rates and for a smaller amount, generally capped at 50,000 rupees. One can check out various financial institutions and loan apps to see which offer is best for them. Also, it’s advised not to go overboard with these plans, as debts will remain longer than the festivals. Festival loans are a very different kind of loan. These loans are new in the market. Lenders are giving out this kind of festival loan to celebrate festivals. These types of personal loans can help one prepare for different festivities, host parties, etc. Festival loans are an excellent way to raise funds for festivals and parties. [B-01] The festive season’s offers can be divided into several categories. Discounts and cashbacks Cashbacks and discounts are put in place to make the original price of a product more affordable. These lower the proportion of the initial cost. Customers who want to buy white home and kitchen essentials, electronic appliances, and furniture can use these offers to get the advantages offered through discounts and cash back. Many different lenders offer such deals with credit cards and debit cards. These festive loan offers are generally available throughout the year. The discount amount may fluctuate according to seasonal festivals. Customers can also get such discounts on “buy now, pay later” services. Spend-based offers These festive loan offers are generally for customers using debit and credit cards. These offers are generally given to customers to encourage them to spend a particular amount at a specific time. The customer will get more cashback offers, gift cards, vouchers, and rewards by paying at that time. Spending that time can also give the customer complimentary access to a premium privilege and many more offers. The customer can get many more benefits with these festive loan offers. Let’s talk about the several ways to use the festive loan offers. Home Renovation The most common Diwali custom is to renovate one’s home. Everybody starts decorating their home and making it look nice. Decorating and renovating a house will need a good amount of money. Festive loan offers will provide the customer with some quick funds. These funds will help the customer renovate their home easily and quickly. If the customer wants, they can apply for an easy personal loan from a bank during the festive season. This will be very beneficial for the customer. Painting the house It is a very familiar thing that during Diwali, people start painting their homes. By painting the homes, they try to give the house a new and clean look. Painting walls is expensive nowadays. If the customer wants personalised paint for their house, it may cost more. This is why many customers postpone painting their homes. In this case, personal or festive loan offers can help customers by providing them with some quick cash during the festive season. A personal loan gets disbursed very quickly, within days or even a few hours. Flying back home It is an essential custom to be at home with family and friends during Diwali and the festive season. If someone works in the IT industry or some other profession far away from home, coming back home during festivals is nothing less than a big deal. Taking a flight back home will be the quickest option. But the flight tickets are way too costly, especially during Diwali and the festive season. The customer can apply for a personal loan for this. Festive loan offers will help the customer save money. Gifts and presents Gifting presents to family, friends, and loved ones is a must for Diwali or any festive season. There is a massive list of gifts that one has to give others. Some gifts may be dresses, accessories, dry fruits, sweets, etc. One might have to get the close ones better gifts than these, like jewellery and ornaments made of gold or diamonds. It is well known that these gifts are expensive. If the family is significant, then the amount spent will be higher. A personal or festive loan offer can provide the customer with instant and quick cash. This money will instantly refill the bank account. It will help with uninterrupted shopping for loved ones. One does not need to worry about the money spent on gifts during the festive season. [B-02] Conclusion To wrap up this whole article, a personal loan is an easy way to carry out all the expenses of the holiday season. Diwali is a significant festival in this country. A personal loan will help the customer raise some quick funds this season. The festive loan offers are easy to avail, convenient, and quick. The EMI comes with a long tenure, so the amount of payback is smaller. For further information about personal loans, financing, and holiday loan offers, Piramal Finance will be a great help.

08-11-2023

Personal Loan

5 Simple Ways to Repay Your Personal Loans Quickly

Everybody wants to live a stress-free life. Nobody wants to bear unnecessary tension, especially in finances. Most people in our society belong to the middle class. They face more financial problems than others like payment of school fees, dissatisfaction with salary, regular cost-cutting due to little money, etc. Such issues are typical and do not pose a significant threat to livelihood. However, some things have become universal problems in the day-to-day life of people. An example is personal loan repayment. This article introduces personal loans, their pros and cons, and ways to repay them quickly. [B-01] What are Personal Loans? A personal loan is a certain sum of money that a person borrows for his personal use. For example, education loans, home loans, etc. The borrower can return or repay the amount at a fixed rate. A particular interest rate allows the lender to recover the principal and the borrower’s extra amount. That additional sum is called interest. Personal loan repayment is generally not entitled to any mortgages. This means that the borrowers can avail the sum without any collaterals like properties or houses. This makes such loans risk-free. It usually takes about 1-7 business days to approve a personal loan after documents are submitted. There are numerous ways to repay them, such as EMI (Instalments) Full payment In simpler words, personal loan repayment is relatively easier than a consumer loan. Advantages of Personal Loan Prepayment There are various benefits of personal loans, such as It helps improve the borrower’s CIBIL score: This improves the financial reputation of the borrower, making it easier for him to avail of another loan afterwards. It is processed without collateral security: The borrower is not required to keep anything on the mortgage to repay the personal loan. Approval is quick and hassle-free: The process is quick and simple. It requires minimum document submission: Basic documents such as identity proof, address proof, bank statements, and documents related to salary need to be submitted. No limit on the amount: A person can avail of up to 35 lacs in personal loan. Disadvantages No matter how attractive it is, personal loan repayment has some cons. A few of them are listed below: There are high-interest rates: Rates keep getting high if debts are not paid on time. Borrower faces sabotage to his/her credit image: This is the opposite of a good CIBIL score. It reduces one’s chance of getting another loan from banks or financial institutions. Fear of penalty by the lender: The lender can recover a debt by legal means if the borrower is unable to repay the personal loan. Leads to stress and anxiety: Unnecessary debts interfere with day-to-day life. This leads to mental health issues such as stress and depression. How to repay your loans? Every problem has a solution, just like this one. Remember, it is not difficult to achieve this target if one knows the correct and quick ways of personal loans repayment. Please find the easy ways to solve this problem below. Mutual funds These are the best way to repay your debts if the loan amount has reached its peak. This can be done seldom, but it is beneficial to the borrower. Investment in mutual funds is useless if one does not take their help for personal loan repayment. One can sell liquid assets such as gold or money market funds to recover from unnecessary debt. Mutual funds come to the rescue when one has no choice. However, please note that this method is only for emergencies. Mutual funds themselves come with a lot of risks. So try to think twice before availing of a personal loan. One should ensure whether one can repay as personal loan repayment is quite tough. Savings Savings is the most secure way of repaying personal loans. These help people who have no prior investments. Make sure you save a particular sum of money from your monthly income to repay your loan. Take help of debt-consolidation It is the practice in which one takes a new loan to repay his/her existing loans. It is a great way to reduce the burden of over-debt. This method comes in helps if one has multiple debts to repay. Collect all your loans together, such as home loans and so on, and combine them into one single loan. This single loan can be paid at the end of every month at a fixed interest rate. Talk to the lender There are some loans one cannot avoid. Such loans are essential for life activities such as education loans. The tenure for such loans is generally higher as compared to the other ones. This, in turn, increases the interest rate too. Therefore, one should try to convince the lender to decrease the repayment tenure. This is not a difficult task as institutions generally fulfil the request of people with high CIBIL scores. One could repay the amount quickly if the tenure is less. A loan with a higher interest rate is crucial If an individual borrows a sum at a higher interest rate, that particular loan becomes a priority. All other loans should then be kept aside. Focus on that particular sum. Try to repay the instalments as quickly as possible. Ignore other loans for a while. This will enhance the quick payment of that debt. [B-02] Conclusion One should avoid taking unnecessary loans to save oneself from debt burden in the future. Keep in mind to only avail of essential loans such as education loans, home loans, and so on. Follow the above guidelines to recover from unnecessary debts quickly. Also, please visit Piramal Finance to avail of loan facilities or read more blogs like this.

08-11-2023