Purchase of used cars has been simplified today with the availability of customised financing options like second hand car loans. These advances are designed to ensure easy, high-value financing at affordable rates for convenient used car purchase financing. Not to mention, the repayment tenures that they come with are suitably extended to break down the total loan liability into small EMIs as well. You only need to meet a handful of eligibility criteria to avail a used car loan today. While all of this makes funding convenient, prudent financing rules suggest that you assess your overall loan affordability before making a borrowing decision. To that end, financial tools like second hand car loan calculator can come to the rescue.
You can use the tool to assess how much EMI you would need to pay for your selected loan amount and tenure, among other factors. Let’s know in detail about what this calculator comprises and how you can use it for the maximum benefit.
What is a Second Hand Car Loan EMI Calculator?
A second hand car loan calculator is a self-help financial tool that enables you to make a suitable borrowing decision based on several computations. It is a simple tool with an easy to understand interface and requires you to complete only a few steps for the calculation. The results are quick and accurate too, which means you do not need to undergo lengthy, manual computations which may also be full of errors.
Several reputed financial institutions and intermediaries today provide a used car loan calculator for free on their websites, which allows easy access to the tool without any hassle. You also do not need any specific skills to make the computations. Here’s how you can use the calculator for maximised benefits.
Steps to Use a Second Hand Car Loan Calculator the Best Way
1. Enter all the computational values for quick EMI calculation
Once you have accessed the calculating tool online, you can proceed to enter the necessary values to compute the EMIs payable. You would need to provide three pertinent details for this computation, including the loan principal, a suitable tenure for repayment, and the applicable used car interest rates. Based on these entries, the tool would compute the EMIs you would need to pay throughout the tenure. These EMIs carry a principal and interest component each, which, while varying from one EMI to another, keeps the repayment instalment amount the same.
2. Change loan amount and tenure values for suitable EMI selection
While the initial entry of the principal and tenure values is purely based on your requirement, the EMIs so calculated may or may not be affordable. In case it is high, and to bring it down to affordability, you would need to make necessary changes to the loan amount and tenure selected for a better borrowing decision. When doing so, know that an increase or decrease in the loan amount will have a similar impact on the EMIs but it is the opposite with the tenure changes. If the loan tenure is stretched or reduced, it leads to a decrease or an increase in the EMIs respectively. So, you may want to keep this in mind when making tenure changes in your second hand car loan calculator.
3. Check out other computed values
Along with the EMIs, the calculating tool computes other crucial values as well, which primarily include the total loan liability and the total interest liability. You must check out these values as well for an overall affordability assessment. Some sophisticated second hand car loan calculators also compute the amortization schedule, allowing you to check the principal-interest components of each EMI for crucial repayment decisions. Once you have checked out these aspects,you can proceed to apply for your used car loan.