1. What is the EMI Formula?

The EMI (Equated Monthly Installment) formula calculates the fixed payment amount a borrower makes to a lender at a specified date each calendar month. It's used for BankSA loans to determine monthly repayment amounts.

2. How Does the Calculator Work?

The calculator uses the EMI formula:

Where:

• \( P \) — Principal loan amount (AUD)
• \( R \) — Monthly interest rate (annual rate divided by 12, in decimal)
• \( N \) — Loan tenure in months

Explanation: The formula accounts for both principal and interest components of the loan, with interest calculated on the reducing balance.

3. Understanding Loan Repayment

Details: The EMI remains constant throughout the loan tenure, but the proportion of principal and interest changes over time (more interest is paid initially).

4. Using the Calculator

Tips: Enter principal amount in AUD, annual interest rate in percentage, and loan tenure in months. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What factors affect my EMI amount?
A: The three main factors are loan amount, interest rate, and loan tenure. Higher amounts/rates increase EMI, while longer tenures reduce EMI but increase total interest.

Q2: How does changing the tenure affect my loan?
A: Shorter tenures mean higher EMIs but less total interest paid. Longer tenures reduce EMI but increase total interest cost.

Q3: Are there other charges besides EMI?
A: This calculator shows principal and interest only. There may be processing fees, insurance, or other charges depending on the loan product.

Q4: Can I prepay my BankSA loan?
A: Most BankSA loans allow prepayment, but terms vary. Check your loan agreement for any prepayment penalties or conditions.

Q5: How accurate is this calculator?
A: This provides a close estimate, but actual EMI may vary slightly due to rounding or specific loan terms. Always confirm with your lender.