State Bank of India is one of the biggest home loan lenders in the country. Its interest rate is usually the lowest, giving it an edge over the other providers of housing finance in India. Besides, the bank has a clear-cut advantage in terms of the number of branches it has across the nation.
Despite a low interest rate and high tenure, you may not be able to afford a very high loan amount. This is why a calculator is often used prior to applying for a loan. If you are a savvy Internet user, you can use SBI home loan calculator available on the official website to figure out an EMI you are comfortable with.
How to Use an EMI Calculator?
You need a combination of different factors to calculate your equated monthly installment (EMI). These factors may vary depending upon the type of calculator you are using.
- Amount of money you want to borrow
- The term of loan amortization
- The rate of interest applicable in your case
- Processing Fee, if applicable
Since SBI has no processing fee, you only need the first three variables to calculate EMI. Moreover, you may also want to know about the total interest you pay over the term of the loan. This helps you decide between a lower monthly installment and a lower cost of the loan.
Taking an Example
An example will explain this further.
On a loan amount of Rs. 1,00,000 taken for a term of 30 years, you need to pay Rs. 877.57 as EMI and Rs. 2,15,925.2 as total interest keeping the interest rate fixed at 10% for the whole tenure.
Just change the term of the loan from 30 years to 20 years and you will have Rs. 965.02 as EMI and Rs. 1,31,604.8 as total interest while not changing the loan amount and the interest rate.
Based on the above example, you pay Rs. 84,320.4 less in total interest on a loan term of 20 years as compared to 30 years. On the other hand, you have to pay Rs. 87.48 less in monthly installments if you opt for a longer term. A shorter term will also help you pay off the debt sooner.
SBI Home Loan Eligibility Calculator
You also need to check your eligibility prior to considering a home loan option at a lender. The most common eligibility requirements to qualify for an SBI housing loan option may include the following.
- Employment: The applicant must be either salaried or self-employed.
- Age: Minimum 18 years for salaried and 21 years for self-employed. The maximum age limit in both the cases is 70 years.
- Income: The annual income must not be less than Rs. 1,20,000 for salaried and Rs. 2,00,000 for self-employed.
The above are basic requirements that you must have. Besides, there can be a number of factors that can be taken into consideration while approving your loan request. The amount of loan you can borrow is also dependent on these factors. An eligibility calculator is often used to know about the amount the bank is willing to lend.