Shriram Housing Finance Limited is the home financing arm of the renowned Shriram City Union Group. This Company is in existence since 1974. The Company started as a chit fund business. It later on diversified into various business activities like commercial vehicle financing and consumer and enterprise finance. Shriram Housing Finance Limited has a dominant presence in the southern states of Tamilnad and Kerala. The Company offers a range of Home Loan products to cater to the needs of all segments of society. It is a prominent financer under the Pradhan Mantri Awas Yojana, as well. Apart from charging competitive rates of interest, the Company believes in providing the best technological services to its clients.
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Shriram Housing Finance Limited is one of the few non-banking companies to provide technical services of the highest order. The official webpage of Shriram Housing Finance Limited offers access to different calculators to facilitate the calculation of EMI and loan eligibility.
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Using this calculator to understand your Home Loan EMI is elementary. Customers have to submit the minimum data about their Home Loans to determine their Home Loan EMI.
On submitting these three variables, this calculator helps to determine your EMI. It can help plan your home budget better.
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We have seen above that your income and other financial obligations affect your repaying capacity. Similarly, many factors affect your Home Loan EMI, as well.
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Shriram Housing Finance Limited calculated Home Loan interest on the reducing balance method. The ideal repayment method is always the EMI. The repayment of the EMI ensures servicing of the interest as well as a portion of the principal amount.
The Home Loan EMI comprises of two variable components, the interest repayment, and the principal amount repayment part. Any credit into the loan account initially goes towards reducing the interest. The balance amount is appropriated against the repayment of the principal loan outstanding.
In the initial stages of Home Loan repayment, the interest component will be high because of the higher principal loan amount. As you keep repaying the interest and part of the principal loan, it goes on reducing. Thus, you find that the principal repayment is spread across the entire loan tenure. However, the repayment of the EMI ensures that you pay the monthly interest amount in full every month.
|Loan Amount||EMI @ 8.90%|
|10 years||20 years||25 years|
|10 Lakhs||Rs. 12,614||Rs. 8,933||Rs. 8,324|
|20 Lakhs||Rs.25,227||Rs. 17,866||Rs. 16,647|
|25 Lakhs||Rs.31,534||Rs. 22,333||Rs. 20,809|
Points to Note
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Many customers confuse between the two terms, equated instalments and equated monthly payments. They are two different concepts.
Both these methods of repayment have their pros and cons.
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MyMoneyMantra.com EMI Calculator
MyMoneyMantra.com offers the facility of an EMI Calculator on its webpage. Access the Financial Tools option on the official website of MyMoneyMantra to utilise the EMI Calculator. This calculator works on the same principle as that of the Shriram Housing Finance EMI Calculator. However, it provides additional information in the form of total interest repayment over the entire loan tenure.
Apart from the EMI Calculator, MyMoneyMantra offers the use of the following calculators:
In this age of technology, manual EMI calculations have become redundant. However, one should be aware of the mathematical formula for calculating EMI from an academic interest viewpoint.
EMI = [PXRX(1+R)^N] / [(1+R)^N-1]
Calculation of EMI Using MS Excel
Calculating the EMI manually is a complicated process. It is easier to use MS Excel to do so. The following formula can help you to calculate the EMI using MS Excel.
EMI = PMT (rate, nper, pv)
As it is an outflow for the borrower, the resultant EMI is displayed in red.
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Shriram Housing Finance offers a fixed rate of interest as well as floating rates on Home Loans. It also has a Home Loan product with variable interest rates where the rate remains fixed for a specific period. Subsequently, it shifts to a floating rate of interest mode. Under such circumstances, the method of calculation of EMI is different.
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Shriram Housing Finance permits the prepayment of the Home Loan. Under such circumstances, borrowers pay lumpsum amounts in advance, thereby reducing the principal liability considerably. Therefore, the EMIs for the residual period can change, provided the borrower submits a request to the Company.
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The pre-EMI comes into play only in the case of partially disbursed Home Loans. The Company calls for the payment of the interest on the disbursed amount immediately. This amount is known as pre-EMI interest. The borrower is supposed to pay the pre-EMI amount every month. If the Company allows the accumulation of pre-EMI interest, it gets added to the principal amount. Hence, it can affect Home Loan EMI.
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Yes, the results are reasonably accurate. It depends on the data you enter into the system. If you enter information correctly, you get accurate results.
It depends on the sanction terms. If the Company allows accumulation of pre-EMI interest into the Home Loan account, the EMI will change. Similarly, charges like processing fees, insurance, and other fees can also affect the EMI. Hence, it is better to pay these charges upfront.
No, this EMI Calculator is handy for determining the equated monthly instalments and not equated instalments.
PMAY accounts come with an upfront interest subsidy factor. This amount is credited to the loan account, thereby reducing the principal loan component. Hence, the EMI changes for the residual period of the Home Loan.
Shriram Housing Finance prefers to keep the EMI constant and alter the loan tenure accordingly. However, the borrower can express a wish to vary the EMI at the time of acceptance of sanction terms.
It again depends on the repaying capacity of the borrower. If the borrower can afford to pay an enhanced EMI, it is a better option as compared to extending the loan tenure.
Opting for reducing the EMI under such circumstances defeats the purpose of prepaying the Home Loan. It is advisable to maintain the EMI constant.
You can use the EMI Calculator to determine your loan repayment liability every month. If you can afford to pay more than the calculated EMI, you can either go for reduced loan tenure or an enhanced loan amount. Thus, it affects your Home Loan eligibility.
In a way, it is beneficial to opt for the maximum Home Loan tenure. The rate of interest on the Home Loan is the lowest when compared to other loans like personal loans. You can use the surplus funds in your account for other investments.