|
0
|
10L
|
20L
|
30L
|
40L
%
|
5
|
7.5
|
10
|
12.5
|
15
|
17.5
|
20
|
0
|
1
|
2
|
3
|
4
|
5

49,919

69,80,559

#### Total Payments

1,19,80,559

Break-up of Loan Amount
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## HDFC Bank Personal Loan EMI

The fixed amount paid by an individual against the loan taken from any bank such as HDFC is known as Personal Loan EMI (Equated Monthly Instalment). The EMI is paid to repay the loan to the bank. Every month a fixed amount is decided and has to be paid until you cover both the principal amount and interest amount.

HDFC Bank is known to offer the most affordable rate of interest and lower EMIs. The lowest EMI offered by HDFC Bank for the tenure of 60 months is 2187 per Lakh. The lowest rate of interest is 11.25%.

## HDFC Bank Personal Loan EMI Calculator for Different Loan Tenures

### Personal Loan EMI @ 11.25% interest rate for different loan terms

 Loan Amount (Rupees) 2 Years 3 Years 5 Years 1 Lakh 4,672 3,286 2,187 3 Lakh 14,017 9,857 6,560 5 Lakh 23,362 16,429 10,934 10 Lakh 46,724 32,857 21,867

After studying the above table one can easily interpret the various loan amounts along with the lowest rate of interest. The loan tenure has a direct effect on the EMIs as well. The EMI is higher when a loan is taken for a shorter tenure such as 2 years whereas you are required to pay low EMI for longer loan tenure such as 4 years.

The EMIs remains constant but include both the component the interest component as well as the principal amount. Every month there is a slight change in the proportion of each component. With every EMI the proportion of principal amount that will be repaid is higher and the interest component reduces.

## Factors Affecting HDFC Bank Personal Loan EMI

• Loan amount - A loan amount is the amount borrowed by the borrower from the bank. The higher the loan amount the higher the monthly EMI. HDFC Bank gives a loan of minimum amount 50,000 and this can go upto 50 Lakhs maximum.

• Interest rate - Higher interest rate will not only increase your EMI but will also have an effect on the loan duration as well. HDFC Bank offers a lower rate of interest to its salaried account holders. The interest rate of 11.25% is the lowest interest rate offered by HDFC Bank. You must do a complete market research and compare the rates of interest and EMIs of different banks before selecting a bank to apply for the loan.

• Loan tenure - A Loan tenure is a duration for which a loan is given. You will be required to repay your loan within this tenure. Longer loan tenure attracts lower EMIs. HDFC offers the Personal Loan for the maximum period of 5years.

## What is EMI or 'Equated Monthly Instalment?

P*r* (1+r)^n/([(1+r)^n]-1)

Here is an illustration of how HDFC Bank Personal Loan EMI is calculated:

In the above formula,

P = Loan amount. This can range from 50,000 to 50 Lakhs

r = Rate of interest per month. The current rate is 11.25%

n = tenure in month. For HDFC Bank, this can be 60 months

## Tips to Decide the Right Amount of EMI

• Decide the amount you need to borrow: It is very essential to estimate the amount of loan you wish to borrow before selecting and applying for the loan with a bank. The Personal Loans are unsecured loans and hence the rate of interest for the Personal Loan is higher. You should opt for lowest tenure for the loan as the long tenure will result into the higher rate of interest.

• Review your current obligations: One of the most important things to do before applying for the Personal Loan is to evaluate your monthly expenses and consider EMI obligations as well on your current loan accounts. This assessment will help you to plan your finances systematically and reduce the chances of any delayed payments. This will help you to determine your EMI after considering your current obligations. After finalizing the EMI you can afford, you can move on to selecting the right loan tenure.

• Calculate your HDFC Bank personal loan eligibility: The Personal Loan eligibility is the assessment of your loan repayment capacity with respect to your monthly income and your fixed obligations.

1. Multiplier based loan amount eligibility - The loan amount eligibility at HDFC Bank is calculated by multiplying your net take home salary. It is one of the most simplified methods of calculating the loan amount. The formula which is used to calculate the Personal Loan eligibility is

Loan Eligibility = (Your Net Salary) x (multiplier of 9 to 18).

The multiplier depends upon the categorization done by the bank. The categorization may differ from bank to bank and is generally based on the organization stability, reputation, goodwill, growth rate, turnover, etc.

2. FOIR based loan amount eligibility - The Fixed Income to Obligation Ratio (FOIR) is used to estimate the loan amount by HDFC Bank. It is used to estimate the maximum EMI you will able to serve based on the current income and the fixed obligations as well as monthly expenses. The proportion of Fixed Obligation to your monthly income helps to calculate the EMI. The maximum FOIR for the Personal Loan that the bank lends is 0.45. On the basis of FOIR, the bank will zero down the fixed EMI a borrower can pay. However, your personal estimation and assessment of EMI may differ from the bank. You can also repay your short-term loan to improve your eligibility score.

3. HDFC bank using the methods mentioned above calculates the loan amount eligibility. The bank will sanction the loan amount with the help of the methods mentioned above.

## A Quick Guide for HDFC Bank Personal Loan Application

• Purpose of Loan: The Personal Loan is generally taken in case of a medical emergency, paying the additional debt, marriage expenses or any other immediate personal finance requirements.

• Key Features
• Loan amount of minimum 50,000 to 50 Lakhs.

• Loan Tenure 1 to 5 years.
• Interest rates in the range of 11.25% to 20%.

• Lowest EMI of 2,187 per Lakh.
• The loan offered to both salaried individuals and self-employed.

• Borrowers within the age group of 21 and 60 years.

• Processing Fees: The processing of Min 0.99%, Max 2.50% Up to 10,000 of loan amount has to be paid at the time of application.

• Special schemes:The borrowers working with reputed large companies, defense personnel, government employees are considered under special category by HDFC Bank and are given customized Personal Loan interest rates and special schemes.

## Personal Loan EMI Calculator HDFC Bank - How it Works?

• A combination of the loan amount, interest rate and tenure are considered for estimating the EMI, This done with the help of HDFC Bank EMI calculator.

• Reducing balance basis and an assumption that the EMI will be made in arrears (means interest is charged for the month preceding the EMI payment date) and not in advance is considered by HDFC EMI Calculator.

Personal Loan EMI - EMI changes in case of prepayment the outstanding balance on your Personal Loan reduces.

If you prepay your Personal Loan, HDFC Bank gives you two options:

• Reduce your loan tenure by choosing early repayment option:

It is possible to close your loan earlier and save the interest that is associated with your loan tenure. This is suitable for the borrower who wishes to close the loan at the earliest and have the steady income to pay the monthly EMIs.

1. Reduce the amount of EMI for long tenure: You can also reduce the amount of your EMI and keep the loan tenure as long as possible. This will allow you to use the surplus to meet your other needs. This method is suitable for the borrowers having higher monthly expenses and would prefer to reduce their monthly EMIs.

### Why should I calculate HDFC Loan EMI before taking a loan?

It is recommended to calculate the EMI before deciding to take the HDFC Personal Loan or any other. There are various benefits of calculating your EMI in advance. Some of the benefits of HDFC Bank EMI calculator are given below:

• You can always opt for the lower loan interest rate in case your EMI estimated by the calculator is on the higher side. This will help you to manage your monthly budget beforehand and affordable too.

• You can easily plan your expenses accordingly if you know in advance what is the exact EMI amount you will need to pay each month.

• With the proper EMI amount, you can also plan to repay your Personal Loan amount in the future.

### What is the lowest EMI per lakh offered by HDFC Bank on a Personal Loan?

11.25% is the rate of interest offered by the HDFC Bank. The lowest EMI amount is 2,187 per Lakh. However, the Personal Loan interest rate and EMI can vary for the salary account holder or existing customers.

### What are the prepayment charges on HDFC Bank?

HDFC Bank offers you an option of prepayment after 12 months at 2 - 4% prepayment charges.

### Is there any processing charge on a Personal Loan from HDFC Bank?

A Personal Loan processing fee of minimum 0.99% and maximum 2.50% of the sanctioned loan amount (up to 10,000) is charged by HDFC Bank.

### Will I get the Personal Loan from HDFC Bank if I have a bad credit score?

No, in order to apply for personal with HDFC Bank it is essential to have a good credit score. A credit score of 700 and above is usually considered to sanction the loan application. Generally, banks do not allow the sanctioning of the loan to individuals having the low credit score.

### How does a Personal Loan repayment happen?

You can repay the Personal Loan with EMIs (Equated Monthly Installments) from the borrower's account. You may also be asked to submit Post-dated Cheques or sign ECS mandate in favor of the bank at the time of loan disbursal.

### Can I have a co-applicant while applying for a Personal loan with HDFC Bank?

Yes, you can add a co-applicant to take a Personal Loan from HDFC Bank. This will increase your Personal Loan eligibility as the income of the co-applicant is also considered by the bank.