Lenders are bombarding the airwaves and billboards with esoteric combinations of interest rates, freebies, and what not. It is getting hard to separate the grain from the chaff. So we thought we would contribute our mite to making your decision a little easier by giving you a floating vs. fixed interest rate calculator.
What is the single most confusing aspect of a home loan? It HAS to be the interest rate. There are fixed rates, floating rates, and fixed rates with reset clauses. So, we start at the root: You enter the loan amount, loan tenure, fixed interest rate (as promised you by the lender). If you expect the fixed rate to vary, click the Yes button. You will now be asked to fill in the number of variations and the expected interest rates. Once you have done this, enter the floating rate the lender has given you. Once again, you need to fill in the number of variations and the expected interest rates.
Now, click Calculate.
The calculator gives you a straightforward answer, whether to go with the floating rate or the fixed one. It calculates the average of all the changed rates in the course of the loan. If this figure is lesser than the fixed rate, you go for the floating rate. Otherwise, you stick to the fixed rate. What could be simpler than that?
Note: All calculators and comparators are made based on certain assumptions which may not be true in your case. You should consult your personal financial advisor before taking any decision. Apnaloan disclaims any responsibility for any decision taken based on these calculators and comparators.