How is EMI calculated?

EMI = [P x R x (1+R)^N] / [(1+R)^N - 1], where P is principal, R is monthly interest rate, and N is number of monthly installments.

What is amortization schedule?

An amortization schedule shows the month-by-month breakup of your EMI into principal and interest components until the loan is fully repaid.

Does prepayment reduce my EMI?

Prepayment reduces either your EMI amount or loan tenure, depending on what you choose with your lender. It always reduces total interest paid.

EMI Calculator

Calculate your monthly EMI for home, car or personal loans — with full amortization breakdown.

Loan Amount ₹10,00,000

₹

Interest Rate (p.a.) 8.5%

Loan Tenure 20 Years

Yrs

₹8,678

Monthly EMI

Principal Amount₹10,00,000

Total Interest Payable₹10,82,782

Total Payment (P+I)₹20,82,782

Yearly Amortization Schedule

Year	Principal Paid	Interest Paid	Balance

📢 Current Loan Interest Rate Trends (2026)

Loan Type	Typical Rate Range (p.a.)
Home Loan	8.10% – 9.50%
Car Loan	8.75% – 11.50%
Personal Loan	10.50% – 22%
Education Loan	9.00% – 12.50%

Rates move with the RBI repo rate and vary by lender, credit score, and loan-to-value ratio. Most home/car loans today are on a floating rate linked to the External Benchmark Lending Rate (EBLR) — check your lender's latest rate before signing.

How EMI Is Calculated — Explained Simply

Your EMI (Equated Monthly Instalment) is a fixed amount you pay every month that combines both principal repayment and interest. In the early years, most of your EMI goes towards interest; in later years, more goes towards principal — this is called amortization.

Variable	Meaning
P	Principal — the loan amount you borrow
R	Monthly interest rate = (Annual Rate ÷ 12) ÷ 100
N	Total number of monthly instalments (years × 12)

Formula: EMI = [P × R × (1+R)^N] / [(1+R)^N − 1]

What Affects Your EMI

Loan amount: Higher principal → higher EMI, all else equal.
Interest rate: Even a 0.5% rate difference can change total interest by lakhs on a 20-year home loan.
Tenure: Longer tenure lowers EMI but increases total interest paid over the loan's life.
Credit score: A CIBIL score above 750 typically qualifies you for the lowest advertised rates.
Loan type: Secured loans (home, car) carry lower rates than unsecured loans (personal loans).

Tips to Reduce Your EMI Burden

Make a larger down payment to reduce the principal you borrow.
Compare rates across at least 3-4 lenders before choosing — even public vs private banks differ meaningfully.
Improve your credit score before applying to unlock better rate slabs.
Consider a shorter tenure if your monthly budget allows — you'll pay far less total interest.
Make partial prepayments whenever you have surplus funds (bonus, increment) — most floating-rate home loans have zero prepayment penalty.
Do a balance transfer to another lender if your current rate is much higher than the market rate.

EMI = [P × R × (1+R)^N] / [(1+R)^N − 1], where P is the loan principal, R is the monthly interest rate (annual rate ÷ 12 ÷ 100), and N is the total number of monthly installments.

It's a month-by-month (shown here yearly for readability) breakdown of how much of each EMI goes towards principal vs interest, until the loan balance reaches zero.

Prepayment reduces either your EMI amount or your remaining tenure — most banks let you choose. Either way, it lowers the total interest you pay.

Most Indian home loans are floating-rate, linked to the RBI repo rate via EBLR — they fall when RBI cuts rates and rise when it hikes. Fixed rates offer predictability but are usually 1-2% higher and often only fixed for a limited period.

750 and above is generally considered good and unlocks the best rate slabs. Below 650 often means higher rates or loan rejection at most banks/NBFCs.

By RBI rule, floating-rate home loans and personal loans to individuals cannot carry prepayment/foreclosure charges. Fixed-rate loans and some car loans may still have a 2-5% charge — check your loan agreement.

Only if your monthly cash flow genuinely needs it. A longer tenure lowers your EMI but sharply increases total interest paid — e.g., extending a ₹50L home loan from 15 to 25 years can add several lakhs in extra interest.

⚠️

This calculator provides illustrative estimates only. Actual EMI may vary based on your lender's processing fees, exact interest calculation method, and other charges. Rate ranges shown are indicative as of 2026 and change with RBI policy — this is not financial advice, please verify with your bank before making decisions.

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