1. What is the EMI Formula?

The EMI (Equated Monthly Installment) formula calculates the fixed payment amount a borrower makes each month to repay a loan. It's used for Public Bank housing loans to determine monthly payments.

2. How Does the Calculator Work?

The calculator uses the EMI formula:

Where:

• \( P \) — Principal loan amount (MYR)
• \( R \) — 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 payment, with more interest paid initially and more principal paid later in the loan term.

3. Importance of EMI Calculation

Details: Calculating EMI helps borrowers understand their monthly financial commitment, plan their budgets, and compare different loan options before committing to a housing loan.

4. Using the Calculator

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

5. Frequently Asked Questions (FAQ)

Q1: What is the typical interest rate for Public Bank housing loans?
A: Interest rates vary but typically range from 3% to 5% per annum depending on the loan package and market conditions.

Q2: What is the maximum loan tenure available?
A: Public Bank typically offers housing loans with tenures up to 35 years (420 months), subject to borrower's age at loan maturity.

Q3: Does the EMI amount change during the loan term?
A: For fixed-rate loans, EMI remains constant. For variable-rate loans, EMI may change if interest rates change.

Q4: Are there other charges besides the EMI?
A: There may be processing fees, legal fees, and stamp duty, but these are typically one-time charges, not part of the EMI.

Q5: Can I prepay my housing loan?
A: Yes, Public Bank allows prepayment, though there may be prepayment penalties especially in the early years of the loan.