HDFC Home Loan provides you with the funding for realising your dream of owning a home. A home loan is a long term commitment that involves a humongous amount. Proceeding to apply for a home loan in an informed way helps you to apply for a loan you are eligible for and make the loan approval process much easier. In order to apply for a loan amount with an affordable EMI, you will have to calculate the loan eligibility in advance. You can do the calculation using HDFC Home Loan Calculator.
HDFC Home Loan Calculator helps you calculate the eligible loan amount. The home loan eligibility depends on the income, credit score, existing fixed obligations, retirement age, etc. Given the required inputs like monthly gross income, interest rate, tenure and the existing EMIs, the calculator will arrive at the eligible loan amount.
With the eligible loan amount, you can calculate the monthly EMI with the HDFC Home Loan EMI calculator for different tenure options. Compute the fixed expenses, assess your important financial commitments and see what expenses can be cut down to fit in an EMI that will fetch you the desired loan amount.
How to use HDFC Home Loan EMI Calculator?
To use the HDFC Home Loan EMI Calculator, you will have to follow some simple steps.
- Access the official HDFC website.
- Click on the Checklist and Calculators option.
- Choose the Home Loan EMI calculator among the various calculator options available.
- Key in the desired loan amount, the tenure and the rate of interest
- The monthly EMI, the principal amount, the total interest outgo and the total amount that will be paid for the given tenure will be displayed.
With the details, you will be able to understand the overall cost of the loan, and you can plan for prepayments as well to reduce the cost of the loan.
How to use the HDFC Home Loan EMI calculator to plan well?
Using the HDFC Home Loan EMI calculator to get an idea of the monthly outgo towards the home loan is the first step. The home loan EMI depends on the loan amount, tenure and rate of interest. You can decide on the loan amount and the tenure, but the interest rates are decided by the financial institutions. The Home Loan Calculator is an efficient tool that helps you to calculate the EMI with variations in terms of interest. You can plan for the best and the worst scenario by calculating the EMI with HDFC Home Loan Interest Rates (floating).
● The best scenario:
Assume the interest rates to reduce to the tune of 2% to 3% p.a. Considering the volume of the home loan, a reduction of 2% will make a marked difference in the EMI. For instance, the EMI for Rs.15.00 lakhs at 6.80% p.a.for a period of 15 years will be Rs. 13315.00. If the interest reduces by 2%, i.e., interest is 4.80%, then the EMI will be Rs. 11706.00. The overall saving on the interest for the given tenure will be Rs. 289631.00. At this stage, you can either opt for reduced EMI or a reduction in tenure.
- The worst scenario: What happens if the interest goes up by 2% to 3%. If the current HDFC Home Loan Interest Rate is 6.80%, the EMI for a loan amount of Rs. 25.00 lakhs for a period of 20 years will be Rs. 22192.00. If the interest goes up by 2% and is 8.80% p.a.then the EMI will be Rs. 25060.00.
This will also give you clarity about the advantage of a fixed rate of interest and a floating rate of interest. With the help of this calculation, you can plan your finances to face such probabilities comfortably.
What happens when you miss an EMI?
Use the HDFC Home Loan EMI calculator to borrow only up to an affordable level. Stretching your financial limits will land you into situations like defaulting repayments. Missing even a single EMI towards the HDFC Home Loan can land you in dire consequences. The repercussions of EMI default could be various, but some of them you are definitely bound to face are as given below:
● Default Penalties
A default in EMI will attract late payment fees, penalty interest and other charges as per the internal policies of the lender. Late payment fees could be 1% to 2% of the EMI amount that may seem meagre. But some lenders charge penal interest on the overdue amount for the entire period of default in addition to the late fee, which could be significant.
● Dip in the credit score
Lending institutions report the repayment pattern of every borrower to the Credit Bureau, i.e., Cibil. Even a single missing EMI will be reported and will appear in your credit history. Every missing EMI will bring down your credit score by 50 to 70 points which will negate your chances of future credits. This will impact the score of the guarantor or the co-applicant as well.
The appearance of default in your credit history will mark you as a risky borrower despite the credit score being above the average level. If the EMI default is within 90 days of the earlier payment, you can sight it right by paying the amount with a penalty on the next due date.
● Impact on Balance Transfer
Balance Transfers are permitted only if the repayment track of your existing home loan account is sound. The reduced credit score on account of missing EMI will reduce the chances of transferring the outstanding liability in the existing home loan to another lender with lower interest rates.
What to do when you miss an EMI?
Missing an EMI could be inevitable sometimes, considering the long tenure. You should bring the situation on track by paying off the overdue amount as early as possible and avoid penalties.
If you feel that with the current financial situation, it would not be possible to pay the EMIs on time, you should bring the same to the notice of the lender. If your earlier track record is good, the lender may show some consideration.
If you are under severe financial stress, then you may request the lender to reschedule the repayment terms. You may be allowed a longer tenure to make the EMI affordable and within your budget.