HDFC Personal Loan EMI Calculator - May 2020

Personal Loan EMI Calculator HDFC

• Personal Loan EMI (or equated monthly instalment) is a fixed amount of money paid by you to HDFC Bank against the loan taken for repayment of your loan and payment of interest to the bank. Every month, it is due on a fixed day of the month till your loan is fully paid back.
• HDFC Bank offers affordable and convenient personal loans with loan EMIs as low as ₹ 2,162 per lakh for a tenure of 60 months and lowest rate of interest at 10.75%.

Personal loan EMI calculator at different tenures

Personal Loan EMI for different loan amounts and tenures @ 10.75% interest rate

Loan Amount (Rs.)	2 Years	3 Years	5 Years
1 Lakh	₹ 4,649	₹ 3,262	₹ 2,162
3 Lakh	₹ 13,948	₹ 9,786	₹ 6,485
5 Lakh	₹ 23,246	₹ 16,310	₹ 10,809
10 Lakh	₹ 46,492	₹ 32,620	₹ 21,618

• From the above table, it can be interpreted that for various loan amounts taken at the lowest interest rate, EMI differs for loans taken at different tenures. Your EMI is higher when you take a loan for a shorter tenure of 2 years and is higher for a longer tenure loan of years.
• Each EMI includes a component of interest payment and principal repayment. Even as EMIs remain constant, every month, there is a change in the proportion of interest component and principal repaid. With every EMI payment, the proportion of principal repayment in EMI keeps increasing and the interest component keeps reducing.

Personal Loan EMI for Rs. 1 Lakh loan amount at lowest 10.75% interest rate offered by HDFC Bank for different tenures

Calculated Results for HDFC Bank Home Loan EMI	2 years	3 years	5 years
HDFC Bank EMI for a loan amount Rs. 1 lakh at 10.75%	₹ 4,649	₹ 3,262	₹ 2,162
Total amount you pay back to the bank including principal and interest	₹ 1.12 Lakh	₹ 1.17 Lakh	₹ 1.30 Lakh
Interest you have to pay during the loan tenure	₹ 11,576	₹ 17,432	₹ 29,720

The above table shows that EMI paid on loan will be lower for a loan taken for a longer tenure. However, your total interest outgo is significantly higher in a long tenure loan. In the above example, if you take a Rs. 1 Lakh loan from HDFC Bank for 60 years, you pay the lowest EMI of ₹ 2,162. However, you pay an interest of ₹ 29,720 on a Rs. 1 Lakh loan.
In contrast, if you take a Rs. 1 Lakh loan from HDFC Bank at the lowest loan rate for 2 years, you pay a higher EMI of ₹ 4,649 and pay an interest of only ₹ 11,576 which is less than half of what you pay for a 60 year loan. Hence, it is advisable to choose your loan tenure wisely as longer tenure means high interest expenses.

Factors affecting HDFC Bank Personal Loan EMI

• Loan amount – This is the amount that you have borrowed from HDFC Bank. If you apply for a higher loan amount, your monthly EMI will be high. HDFC Bank gives a minimum loan of ₹ 50,000 , which can go upto an amount of ₹ 75 Lakh.
• Interest rate - Higher interest rate increases your loan EMI as well as the total cost of the loan. HDFC Bank personal loan interest rate for salary account holders can be lower than their quote rates, which can reduce the overall cost of loan and EMI. Lowest interest rate offered by HDFC Bank is 10.75%. However, it is advisable to do complete market research and compare rates online before you apply for a loan.
• Loan tenure – This is the period in which you can repay your loan in HDFC Bank. Longer loan tenure means lower personal loan EMI. Generally, HDFC Bank offers a loan for a maximum tenure of 5 years.

HDFC Bank Personal Loan Interest Calculator Formula

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 ₹ 75 Lakh

r = Rate of interest per month. Current rate is 10.75%

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

As a borrower, calculating right amount of EMI is a function of your loan requirement, your monthly income, repayment capacity as well as the amount of monthly instalment you can afford to pay out from your monthly income. As a guide, follow the below steps to estimate the EMI amount that is advisable for you.

• Decide the amount you need to borrow: It is important that before approaching a bank for loan, you need to estimate the amount of loan you need to borrow. Remember, a personal loan is an unsecured loan that can come at high interest rates and hence, it is advisable to limit your loan amount to the minimum required. Also, based on the EMI you can service, try to opt for the lowest tenure of loans as long tenure loans result in huge interest outgo.
• Review your current obligations: Before taking a loan, it is advisable to evaluate your current monthly expenses including any EMI obligations that you have on your current loan accounts. The assessment will help you to estimate the amount of EMI you can pay comfortably after taking into account other obligations. Once you arrive at the EMI you can service, you can also decide on the right loan tenure.
• Calculate your HDFC Bank personal loan eligibility: Your loan eligibility is a function of an assessment of your repayment capacity based on your monthly income and other fixed obligations.
  
  • Multiplier based loan amount eligibility - HDFC Bank calculates your loan amount eligibility by applying a multiplier to your net-take home salary. This is the simplest method for calculating loan eligibility used by banks. The formula used in the loan amount eligibility calculation is: Loan Eligibility = (Your Net Salary) x (multiplier of 9 to 18). The multiplier depends on the bank’s internal categorization of your employer company based on its reputation, stability, size, and growth in turnover.
  • FOIR based loan amount eligibility - HDFC Bank will also estimate your Fixed Income to Obligations Ratio (FOIR) to ascertain the maximum EMI you can service based on your current income and other monthly expenses. The bank applies a certain ratio to your income to estimate your monthly expenses and then adds your other EMI obligations to calculate your fixed obligations. The proportion of fixed income to your calculated fixed obligations gives your FOIR. HDFC Bank lends up to a maximum FOIR of 0.70. Based on the FOIR, the bank will also estimate the maximum amount of EMI you can service as a borrower. HDFC Bank's assessment may be different from your assessment. Any differences in assessment may require you to readjust your loan amount requirement. You may also consider paying back other running short term loans to improve your eligibility.
  • HDFC Bank will calculate your loan amount eligibility based on the above two methods and will sanction you a lower loan amount arrived at by the above two methods.

• Purpose of Loan: HDFC Bank personal loan is taken to funding medical treatment in case of emergencies, paying additional debts, marriage expenses and other personal finance requirements.
• Key Features
  • Loan available for both salaried individuals and self-employed professionals.
  • Borrowers within the age group of 21 and 60 years.
  • Loan amount of minimum ₹ 50,000 to ₹ 75 Lakh.
  • Loan Tenure 1 to 5 years.
  • Interest rates in the range of 10.75% to 22.00%.
  • Lowest EMI of ₹ 2,162 per lakh.
• Processing Fees: Upto 2.50% Min Rs. 1,999 of loan amount. This is to be paid at the time of loan application
• Special schemes: HDFC Bank offers customised personal loan interest rates and schemes for a special category of borrowers, including borrowers working in reputed companies, banks or government employees etc.

Personal loan EMI calculator HDFC Bank – How it works?

• HDFC Bank personal loan calculator are online tools which give out EMI calculations using a combination of loan amount, interest rate and loan tenure.
• HDFC Bank EMI calculator considers “reducing balance basis” and assumes that payment of EMI is made in arrears (means interest is charged for the month preceding the EMI payment date) and not in advance.

In case you prepay your personal loan, the outstanding balance on your loan reduces. In this scenario, HDFC Bank will allow you to reduce your loan tenure or reduce your EMI. The right decision is dependent on you monthly budget and personal preference. You should opt to reduce your EMI if you want to have a higher monthly spend budget or you should opt to lower your tenure if you want to save on your total interest outgo and want to close your loan quickly. You can calculate the change in your EMI by inputting the outstanding personal loan amount from HDFC Bank, the interest rate and the remaining tenure in the EMI calculator.

How to process for Personal Loan EMI moratorium in HDFC Bank?

After the announcement of RBI on 22nd May 2020, HDFC Bank has extended the loan moratorium for the term loans and interest of working capital loans to next three months till August 2020. As a borrower, you have the option to opt-in or opt-out of the moratorium by informing HDFC Bank. The interest will continue to accrue on the principal outstanding during this moratorium and the accumulated interest would be added to the principal amount resulting in the extension of loan tenure except in cases where the tenure extension is not possible will increase EMI amount. The moratorium on payment of Personal Loan EMI’s will not be treated as default and will not have any negative impact on the borrower’s credit score. To know more about the moratorium option, you may contact HDFC Bank customer care or its nearest branch.

FAQs on HDFC EMI Calculator

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