- Interest Rate does not change as per the market fluctuations
- Having a fixed interest rate brings a sense of safety and security for the borrower
- Since it entails a fixed monthly repayment schedule, it helps in easy budgeting
Drawbacks of Fixed Interest Rate:
- Generally, Fixed Interest Rates are 1%-2.5% higher than Floating Interest Rate
- Fixed Interest Rates are subject to change as per the market fluctuations, hence if by chance the interest rate decreases, the fixed rate Citi Bank Student Loan won’t be benefited as the borrower will have to pay the same fixed amount every month.
Floating rate of interest changes depending on the market-lending rate. It is also known as variable rate of interest. If the lending rate increases, the floating interest rate will also increase. Due to the risk of fluctuation, the floating rate of interest is usually lower than the fixed rate of interest. With a floating rate of interest for a specified loan tenure, you can either expect your EMI to reduce or increase depending on the rise in the interest rate.
The online loan EMI calculator for Citi Bank Student Loan can be used to calculate loan EMIs with a Floating rate of interest.
Floating Interest Rate is the rate which changes as per the market conditions. Loans on floating interest rates are tied to a base rate PLUS a floating element thereof.
Benefits of Floating Interest Rate:
- Floating Interest Rates are cheaper than Fixed Interest Rate
- During the long term, even if the floating interest rate rises the fixed interest rate, they will eventually fall. Hence ensuring a lot of savings.
Drawbacks of Floating Interest Rate:
Hence it is necessary that you conduct a proper cost and benefit analysis before choosing among Fixed and Floating Rate of Interests.
Why should I use an Citi Bank Student Loan calculator?
The simplest answer is that it’s fast and it’s convenient. This means that you can do multiple calculations in minutes where such calculations many take longer were you to sit down with a pen and paper. These calculators are also super accurate, so it eliminates the possibility of errors in calculations, provided you provide accurate data.
Will banks provide the Citi Bank Student Loan calculator?
Yes. These days most, if not all, banks have Citi Bank Student Loan calculator, specific to various loans, available on their websites.
How much should I pay as monthly EMI for Citi Bank Student Loan?
Monthly EMI for Citi Bank online payday OK Student Loan depends upon your income and expenses. Generally, banks advise you to limit your EMI to 35% to 45% of your net income so that you can pay your EMI without any burden or difficulty. You can calculate your EMI online which will help you to know your repayment capacity.
If you miss your EMI payment on your Citi Bank Student Loan or if there is an ECS bounce then bank may charge a penalty. In addition, it will also be reflected in your CIBIL report and your CIBIL score may get impacted.
What if I get delay in paying the Citi Bank Student Loan?
Banks charges penalty for delaying EMI payment for Citi Bank Student Loan. The amount of penalty varies from bank to bank. This also impacts your CIBIL Score.
Why it is necessary to calculate Citi Bank Student Loan beforehand?
It is important to calculate your EMI in advance to maintain stability in future payments. When you avail loan for your Citi Bank Student Loan, you promise the bank to pay a fixed amount at fixed date every month. So, before availing the Citi Bank Student Loan you should consider the stability of your income, monthly expenses and the existing loan obligations to avoid any discrepancies in future payments.