Piramal Housing Finance Home Loan EMI Calculator

Piramal Capital & Housing Finance (PCHF) was found in 2010 as a Non-Banking Financial Company (NBFC), offering structured loans to the Indian real estate sector. The company is registered with the National Housing Bank (NHB) and offers flexible loan options to both wholesale and retail customers. Throughout its stint, the company has been acknowledged for its umpteen financial services and therefore been awarded with numerous awards and recognitions.

Offering structured debt to the real estate sector is the core business of Piramal Capital & Housing Finance. With a whopping figure of  47,000 Crores as total investments, loans, and assets under management, the company enjoys a Return on Equity of over 19%. Its strong in-houses processes and controls help the company brings down the Non-Performing Asset percentage to 0.3%. Piramal Capital & Housing Finance offers Home Loans under various schemes. The lowest rate of interest offered is 11.00% p.a.

The borrower is legally bound to pay back the availed amount of Home Loan along with the interest charges within the stipulated time period. The total amount is divided by the loan term to get the equal monthly amount called the Home Loan EMI. The EMI is calculated using three parameters - principal amount, loan tenure, and rate of interest. The EMI schedule, also known as the repayment schedule, shows the repayment installments of the availed Home Loan.

The below table depicts the EMI schedule of Piramal Housing Finance Home Loan. The table shows the respective EMI amounts against different Home Loan quantum for different loan tenures. The rate of interest used for the preparation of the EMI schedule is 11.00% p.a.

As shown in the above table, the tenure is a very important factor for Home Loan EMIs. As the duration of the loan increases, the EMI drops significantly for the same principal amount.

However, opting for a Home Loan with the longest tenure can turn out to be really expensive. So, before going in for the lowest EMI or the maximum Home Loan term it is important to consider the EMI break-up schedule. The break-up of the EMI value shows the cost of the loan.

Below is the EMI break-up table of Piramal Capital & Housing Finance. The table shows EMI break-up for a Home Loan amount of Rs. 1 Lakh availed at the rate of interest of 11.00% p.a.

The above table shows the break-up of Home Loan into principal and interest of 1 lakh Home Loan. While the increase in loan duration brings down the EMI, the interest portion on the principal amount increases manifold. This makes the Home Loan very expensive. But going in a shorter duration loan will lead to an increased EMI which may put a financial burden on the borrower. Thus, it is very important to balance between Home Loan term, and EMI amount.

For example, the EMI per lakh for a 20 year Home Loan is Rs. 1,032. The figure comes down to Rs. 952 when the term of the loan increases to 30 years. But a Home Loan availed at 11.00% p.a. the amount of interest paid over 20 years is 1,47,725 as against 2,42,836 for Home Loan with 30 year maturity. As the interest part is only an expense, the higher the interest component, more expensive will be the Home Loan.

Additional Info: Also check HDFC Home Loan EMI Calculator

Piramal Capital & Housing Finance issues Home Loans under different schemes. Each scheme is floated to cater to distinct needs and is therefore marked with unique features. 

The prospective borrowers can assess individual schemes and apply for the most appropriate Home Loan scheme depending upon personal need and requirements:

The Home Loan EMI is dependent on numerous factors. A change in any factor directly or indirectly influences three main parameters - principal amount, loan tenure, rate of interest that lead to a change in the EMI payout. These factors are:

Amount Borrowed: The amount of loan taken for the purchase or construction of the house will determine the EMI. There is a direct and positive correlation between the amount borrowed and the EMI amount.  As the Home Loan principal amount increases, the EMI value increases.

Rate of Interest: Interest levied on the principle Home Loan amount is a significant constituent of the EMI. Thus the EMI is linked to the rate of interest on Home Loan . Any increase in the rate of interest will lead to a higher EMI.

Duration of the Loan: The EMI will be high if the duration of the loan is small and vice-versa. If the borrower has a steady source of income, long duration and small EMI would be helpful.

Applicant's Profession: The rate of interest levied on the Home Loan principle, to a certain extent, depends on the occupation of the applicant. The EMI amount may thus be different for a government servant and a businessman.

Purpose of Home Loan: Home Loans are offered for varied purposes, including the purchase of new property, purchase of land and subsequent construction of a house or even renovation and repair of a house. The rate of interest, and in turn, the EMI depends on the purpose for which the borrower has availed the Home Loan.

Creditworthiness: Applicants with a good CIBIL rating or applicants having an existing association with the lender tend to enjoy a preferential rate of interest on Home Loans and thus pay relatively lower EMIs.

You can also Apply for 20 Lakh Home Loan

The EMI amount has to be paid throughout the tenure of the loan. It is the fixed outflow of funds paid towards loan repayment. An EMI which does not unduly strain the financial position of the borrower is ideal. An EMI that is easily paid month on month will undoubtedly increase the pleasure of owning the home. Here are a few tips to determine the ideal EMI.

Minimise Loan Amount: Interest is levied on the principal Home Loan amount. Larger the borrowings more will be the interest and the EMI. The borrower should, therefore, make as much down payment as possible so as to minimise the EMI payout.

Get the Math Right: The borrower should critically examine the household budget before availing the Home Loan. The Home Loan EMI payout is a long term financial obligation and should be set in a manner that it does not affect the smooth day to day functioning of the household.

Duration of the Loan: The Home Loan tenure is one of the key determinants of the EMI amount. Home Loans of longer duration entail a larger interest payout but help in keeping the EMI amount low. On the contrary, Home Loans with smaller tenure decrease interest payout but entail a bigger EMI.

Assess FOIR: The Fixed Obligations to Income Ratio (FOIR) is a good indicator of the EMI that the borrower will able to bear. The borrower should ensure that the EMI payout of all liabilities put together is half the income.

Additional Info: Also check SBI Home Loan EMI Calculator

The EMI on Home Loan ordinarily remains the same. The borrower may request for a change in EMI in case of an emergent situation. The lending institution will then adjust the EMI amount. It is pertinent to note that such requests entail levying of additional charges which have to be borne by the borrower.

The duration of Home Loan that has a floating rate of interest increases or decreases depending on interest rate fluctuations. The changes in the total Home Loan payout because of the change in the rate of interest are first adjusted against the change in loan tenure. In case an increase in loan tenure is not possible, the adjustment is made by increasing the EMI. In any case, the loan must be repaid before the borrower attains the maximum permissible age.

Additional Info: Also check Banglarbhumi West Bengal Land Record

Most financial institutions allow prepayment of Home Loans. The feature is available on Home Loans with fixed interest rates as well as under floating interest rate scheme.

Any prepayment by the borrower is adjusted towards the outstanding principal. The reduction in principle outstanding necessitates either a reduction in the EMI payout or the duration of the loan.

Additional Info: Also check AnyRoR Gujarat Land Record