Used cars market in India has grown exponentially in these last fifteen years, and more and more buyers prefer to buy used cars in good condition to save money in these difficult times. The Internet has made searching for cars a child’s play as you can now hunt for your dream car from the comfort of your home in a few clicks. Loan for used car have also gained immense popularity with the masses and several banks, and private lenders who were earlier hesitant in offering second-hand car loans are now willing to finance the used cars like never before.
If you plan to buy a car and your budget constraints are preventing you from buying a new one, you can always go for a used car loan to make your wish come true. Once you have made up your mind to buy a used car, you should do an extensive internet search by visiting used car web portals and look for a second-hand car that fits your requirements. After shortlisting the car of your choice, you should visit the websites of banks and private lenders to apply for a second-hand car loan and select the lender based on the rate of interest being offered for a used car loan.
How to calculate used car loan using EMI Calculator
To calculate the interest and EMIs on your car loan, you can take the help of the used car EMI calculator available on the website of every bank and a private lender. The mathematical formula for calculating used car loan EMI, which is equal to the principal loan amount + the used car loan interest, is [P x R x (1+R)^N]/[(1+R)^N-1], where P stands for the principal amount, R stands for Rate of Interest, and N stands for the Tenure of the Loan in months.
A used car loan calculator helps you calculate the EMI that you will need to pay towards the principal and interest payment of your loan over the loan tenure. By using a used car loan EMI calculator, you can arrive at a suitable tenure to comfortably pay off your used car loan. The calculator makes planning your monthly instalments easy so that you do not default on your payments.
EMIs or Equal Monthly Instalments for a used car loan needs to be paid for the principal amount borrowed for a fixed tenure to pay off the loan. Loan tenure for a used car can vary anywhere between 12 to 60 months and it is entirely at your discretion what tenure you want to choose to repay your used car loan. EMI includes both the principal amount and the interest applicable to the loan. Though the amount of EMI remains unchanged, the principal and interest amount change month after month. The interest is higher during the initial months of your loan tenure, but gradually, the principal amount becomes higher. The exact percentage of the principal and interest amount will depend on the applicable rate of interest and the tenure for which the loan is taken.
To calculate your monthly EMIs using a used car loan EMI calculator you need to enter the principal loan amount which is the total amount of money that you borrow and must repay at the applicable interest rate over a fixed tenure, the rate of interest at which interest will be charged on your principal loan amount over a fixed tenure, and the muthoot finance tenure within which you must repay your used car loan.
Using the above inputs, you can use a used car loan calculator for EMI in three simple steps –
Step 1:Using the first slider, set the principal loan amount. You can even use the ‘+’ and ‘-symbols to adjust the values or manually enter the same in the respective box.
Step 2:Input the applicable rate of interest using the second slider. Again use the ‘+’ and ‘-‘signs to increase or decrease the value or simply enter it in the box.
Step 3:Set the desired loan tenure either in months or years. Increase or decrease the values using the slider, the ‘+’ and ‘-‘symbols or just manually enter it in the box.
Once done, the user-friendly car loan calculator will automatically display the EMI value with 100% accuracy at lightning speed.
