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EMI Calculator

Enter the loan amount, interest rate and tenure to see your EMI. Then open the prepayment section: paying even a small extra amount each month usually cuts years off a home loan and saves more interest than people expect.

Tenure in
Add a prepayment (optional)

Paid on top of each EMI

A lump sum paid once

12 = at the end of year one

Enter the loan amount, interest rate and tenure to see the EMI.

How to use this tool

  1. Enter the loan amount you are borrowing, not the price of the house or car.
  2. Enter the annual interest rate from your sanction letter or the lender's website.
  3. Enter the tenure and choose whether you typed it in years or months. Lenders sanction loans in months, so 240 months and 20 years give the same result.
  4. Read the EMI, total interest and total amount payable. The year-wise table shows how much of each year's payments goes to interest and how fast the balance falls.
  5. To test a prepayment, open “Add a prepayment” and enter an extra monthly amount, a one-time lump sum with the EMI number you will pay it with, or both.

Formula and method

EMI

EMI = P × r × (1 + r)^n ÷ ((1 + r)^n − 1)
P
— loan amount (principal)
r
— monthly interest rate = annual rate ÷ 12 ÷ 100
n
— tenure in months

This is the standard formula for a reducing-balance loan, used by Indian banks and lenders for EMI loans. Interest for each month is charged only on what you still owe, so the EMI stays fixed while the interest part of it shrinks and the principal part grows.

Each month's split

Interest = Balance × r;  Principal = EMI − Interest

The schedule applies this month by month. A prepayment goes straight to principal, which lowers the balance that every later month's interest is charged on — that is where the saving comes from.

Worked examples

₹10 lakh home loan at 8.5% for 20 years

  1. Monthly rate: 8.5 ÷ 12 ÷ 100 = 0.0070833
  2. Tenure: 20 × 12 = 240 months
  3. (1 + 0.0070833)^240 = 5.44124
  4. EMI: 10,00,000 × 0.0070833 × 5.44124 ÷ (5.44124 − 1) = ₹8,678
  5. Total paid: 8,678 × 240 ≈ ₹20,82,777

An EMI of about ₹8,678, and ₹10,82,777 of interest — more than the amount borrowed.

The same loan with ₹2,000 extra a month and a ₹1 lakh part-payment

  1. EMI stays ₹8,678; ₹2,000 more is paid every month
  2. ₹1,00,000 is paid along with the 12th EMI
  3. The balance reaches zero in month 131 instead of month 240
  4. Interest paid: ₹4,95,307 instead of ₹10,82,777

The loan closes 9 years and 1 month early, saving about ₹5,87,470 in interest.

Notes and limitations

  • Prepayment is modelled the way most banks apply it by default: the EMI stays the same and the tenure gets shorter. If you ask the bank to reduce the EMI instead, you save less interest than shown here.
  • The rate is assumed fixed for the whole tenure. Most Indian home loans are floating-rate and linked to the repo rate, so the real EMI or tenure will move when the RBI changes rates.
  • Processing fees, insurance bundled with the loan, GST on charges and any prepayment penalty are not included.
  • Figures are rounded to whole rupees on screen; the calculation itself runs in paise so the schedule adds up exactly, with the last EMI absorbing any rounding.

Frequently asked questions

How is EMI calculated?

With the reducing-balance formula EMI = P × r × (1 + r)^n ÷ ((1 + r)^n − 1), where r is the monthly rate and n the number of months. Each month the bank charges interest on the outstanding balance and the rest of the EMI reduces the principal.

Is it better to reduce the EMI or the tenure after a prepayment?

Reducing the tenure saves more interest, because the higher EMI keeps pulling the balance down faster. Reducing the EMI gives you more monthly breathing room. Which suits you depends on your cash flow; the calculator shows the interest each option leaves you paying.

Can the bank charge me for prepaying a home loan?

RBI rules do not allow banks and NBFCs to charge a prepayment or foreclosure penalty on floating-rate loans taken by individuals for non-business purposes. Fixed-rate loans can carry a charge, so check your loan agreement before making a large part-payment.

Why does so much of my early EMI go to interest?

Because interest is charged on what you still owe, and at the start you owe almost everything. On a 20-year loan at 8.5%, around 82% of the first EMI is interest. The year-wise table shows the split shifting towards principal over time.

What is the difference between this and the loan payment calculator?

The arithmetic is the same. This calculator takes the tenure in months, formats amounts in lakhs and crores by default, and models prepayments. The loan payment calculator also handles weekly and fortnightly repayment schedules.

Does a longer tenure reduce the cost of a loan?

No — it reduces the EMI but increases the total interest, often sharply. Try the same loan at 15 and 25 years: the EMI difference is modest, but the extra interest over the longer term can run into lakhs.

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