EMI stands for Equated Monthly Installment. It is a fixed payment amount made by a borrower to a lender at a specified date each calendar month. EMIs are used to pay off both interest and principal each month, so that over a specified number of years, the loan is paid off in full.

EMI is calculated using the formula: EMI = [P x R x (1+R)^N] / [(1+R)^N – 1], where P is the principal loan amount, R is the monthly interest rate, and N is the loan tenure in months.

An amortization schedule is a table that shows the breakdown of each EMI payment into principal and interest components over the loan tenure. It also shows the outstanding balance after each payment.

Yes, you can reduce your EMI by either negotiating a lower interest rate, increasing the loan tenure, or making a higher down payment to reduce the principal amount.

Missing an EMI payment can lead to late payment fees, increased interest rates, and a negative impact on your credit score. Repeated defaults may lead to legal action by the lender.

Paying EMI in advance or making part-prepayments can reduce the total interest paid and may shorten the loan tenure. However, some lenders charge a prepayment penalty, so check with your lender first.

In reducing balance method, interest is calculated on the outstanding principal, which decreases with each payment. In flat interest rate method, interest is calculated on the original principal for the entire loan tenure, resulting in higher interest payments.

Longer loan tenures result in lower EMIs but higher total interest paid over the loan period. Shorter tenures have higher EMIs but lower total interest cost.

The tenure for personal loans typically ranges from 1 year to 5 years, though some lenders may offer up to 7 years depending on the loan amount and applicant’s profile.

Generally, EMI remains fixed for the entire loan tenure. However, some lenders may offer flexibility to change EMI by extending or reducing the tenure, but this may involve additional charges.

A higher down payment reduces the principal amount, which in turn reduces both the EMI and the total interest paid over the loan tenure.

Generally, personal loans don’t offer tax benefits as they are unsecured and not taken for specific purposes like home or education loans. However, if taken for business purposes, the interest may be deductible as a business expense.

Personal loan interest rates typically range from 10% to 24% per annum, depending on the lender, loan amount, tenure, and the borrower’s credit profile.

A higher credit score can help you secure a lower interest rate, which directly reduces your EMI amount and total interest payable.

Fixed interest rates remain constant throughout the loan tenure, while floating rates change based on market conditions. Personal loans typically have fixed rates.

Some lenders may offer personal loans without a credit score check, but these usually come with higher interest rates and stricter terms.

Typically, you need identity proof, address proof, income proof (salary slips or bank statements), and photographs. Specific requirements may vary by lender.

Personal loan approvals can take anywhere from a few hours to a few days, depending on the lender and completeness of documentation.

The maximum loan amount depends on your income, existing obligations, credit score, and the lender’s policies. It typically ranges from ₹50,000 to ₹40 lakhs.

Yes, most lenders allow foreclosure of personal loans, but may charge a prepayment penalty, especially if done within the first 6-12 months.