Your EMI is one of the most important components of your two-wheeler loan. Because this is essentially how you'll be repaying the loan, checking your EMI before taking a bike loan is crucial. This is to ensure that the monthly payments are affordable based on the interest rate offered by the lender and the loan amount you have applied for.
Fortunately, you don't have to do any of this manual work anymore. Through an online two-wheeler EMI calculator, you can simply input certain variables, and you'll get the desired result.
But if you'd still like to calculate it manually or understand how it works, we break it down for you step-by-step.
There are usually three factors that are involved in EMI calculation, and they are the loan amount that you borrow, the tenure of the loan and the interest rate involved.
This is the formula for calculating the EMI of your two-wheeler loan.
P x R x [(1 + R) N / ((1 + R) N – 1]
Here, P represents the principal amount of the loan
R represents the rate of interest
N represents the tenure of the loan.
So, for example, if you need a loan of three lakhs at 9% for four years, then your EMI would be Rs. 7466. This can help you decide if the EMI is affordable and if you need a longer or shorter tenure to repay the loan at your convenience.
Fortunately, there isn't any work that is needed from your side if you use a bike loan interest rate calculator online. All you need to do is input your loan amount and the tenure, and the calculator will display the expected EMIs at the applicable interest rate.