Calculating Bike Loan Unsettled Amount When You Miss An EMI
Bike loans have helped many people achieve their dream of owning a bike, and finally being free from dependence on public transport and its erratic timing. Thanks to competitive financiers, interest rates have dropped to very affordable levels, and borrowers get convenient repayment schedules. However, a borrower may find themselves in a situation that makes it difficult for them to repay timely. In such cases, the person has to repay the mortgage due amount.
Understanding What Is Mortgage Due Amount
When you get your bike purchase financed from Shriram Finance, you get a repayment schedule tailored as per your circumstances and you have to repay on time accordingly. The repayment usually happens through monthly installments (EMIs), though after 6 payments the option to foreclose all at once is there.
Tardy status occurs when any particular EMI has not been paid by its cutoff date. Financiers make contingency arrangements for a grace period in cases of payment delay, and the overdue status happens when all these dates get exceeded. Loan Overdue can also be called EMI bounce or past due, and warrants a loan late payment charge.
To find out your loan late payment charges, refer to your agreement and read the terms connected to EMI bounce carefully. At Shriram Finance, the loan late payment charges are calculated at a penalty rate of 36% on the installment amount in arrears. When you miss an EMI payment and then pay it off late, Shriram Finance calculates the penalty rate on the amount and adjusts the delay duration into the loan overdue amount formula. Bank charges of Rs 500 are also applicable for each check bounce instance.
How to Manually Calculate Loan Outstanding Amount
The easiest way to calculate your loan outstanding amount is by using MS Excel sheets; especially if you have multiple EMI bounces.
Make the following columns from A to I, with the amounts and respective months occupying corresponding rows:
- A- Installment Amount Due (for that month)
- B- Due Date of EMI
- C- Tardy Interest Rate
- D- Installment Repayment Date
- E- Delinquent Interest Amount
- F- Penalty Duration in Months
- G- Days Passed After Notice Reminder
- H- Days Adjusted with the Last Date of Month
- I- Total Loan Bounce Charges
The amounts will start from row 2.
Fill in the details for columns A to D. Thereafter, you can use the MS Excel formulas as follows:
- Remember to click the small square dot, and drag it down to apply to all the rows that you have missed payments for.
- E= A2*C2 [Product of values in A and C]
- F= dated if(B2, D2,”m”) [tells how many months of penalty has to be paid]
- G= dated if(B2, D2,”md”) [tells how many days have passed over the date as per notice reminder]
- H= G2/eomonth(D2,0) [tells the ratio of notice overdue days since EMI bounce charges have to be paid for those days too]
- And finally calculate I, the total loan bounce charges as I=(F2+h4)*E2.
If you have multiple missed payments, double click the small square at the corner of I2, and the calculation will come for each. Then you can add up the total loan late payment charges across all those missed months. This is more helpful when you want to foreclose your bike financing.
To calculate manually without Excel, follow these steps:
1. Multiply the overdue penalty rate by installment amount due for that month by checking your borrower’s balance. This gives you the outstanding amount.
2. Then find out how late your payment will be in terms of months and days over the reminder notice.
3. Find the ratio of months to the days exceeded over notice (if any).
4. Add the numbers from points 2 and 3.
5. Multiply this value with the penalty amount from step 1 to get the total loan late payment charges for that particular EMI.
Here is an example:
Monthly Installment Due=Rs 10,000
Overdue Interest Rate= 36%
Payment Due Date= 31/12/2020
Penalty Repayment Date= 31/1/2021
Penalty Duration= 1 month
Days Passed After Notice Reminder=0
So, the loan unsettled amount for December 2020 is 36% of Rs 10,000= Rs 3600 multiplied by 1 month, i.e= Rs 3600.
Your actual loan bounce charges due depend on the time duration for which your specific penalty rate is applicable and the installments you missed. These numbers are just to help you understand how to do it.
Using Online Loan Delinquent Amount Calculator
Shriram Finance Union has a free online loan due amount calculator that you can use for convenience and to know the charges accurately. Remember to contact your lender support, as soon as possible, when you miss EMIs.
What happens if you don’t settle the loan unpaid amount?
When borrowers fail to repay the EMI on time due to any reason, there will be an overdue penalty. On average, EMI bounce penalty notice gives 7 days for meeting the dues when borrowers default without informing. When an EMI bounce happens, you should find out the loan unpaid amount and the penalty, and pay it off as soon as possible. If the check has bounced, then check bounce charges are also included with the loan unsettled amount.
If a mortgage delinquent amount persists for more than 90 days, the financing in question gets categorised as a non-performing asset. Missing your EMI payments hurts your credit history and may make it harder to avail of financing in the future. If you fail to repay for 3 months, you get labeled as a defaulter, and the lender may seize your bike or any other security promised.
If you don’t respond, the lender will contact the guarantor to ensure that the loan tardy amount, bank charges, check bounce charges, etc. are paid off.
If the worst happens and you lose your bike, get in touch with the lender right away. They give you a duration of 3-6 months to repay your loan bounce charges and other dues, and take back the bike. But, they will auction your bike if you don’t take the chances offered for repayment or settlement.
Conclusion
Shriram Finance offers very affordable interest rates for financing two wheeler purchases, starting from 11.5% p.a. The eligibility conditions make it possible for any adult earning at least Rs 12,000 per month to get 100% financing for their dream bike. With flexible repayment scheduling, the return on investment is very good and the amounts can be repaid over one’s convenient time.
Calculate the loan bounce charges right away and repay within the notice period to avoid building them up to a huge amount. You can easily pay EMIs online on time and keep your credit score high. Contact Shriram Finance if you have missed payments and want to figure out the loan unsettled amount.
