EMI Calculator
For Home Loan, Car Loan & Personal Loan
Your Monthly EMI
Principal Amount
Total Interest
Total Payment
Amortization Schedule
| Year | Principal | Interest | Total | Balance |
|---|
What is an EMI?
An Equated Monthly Installment (EMI) is a fixed payment amount made by a borrower to a lender at a specified date each calendar month. Equated monthly installments are used to pay off both interest and principal each month so that over a specified number of years, the loan is paid off in full.
The EMI Formula
The mathematical formula for calculating EMI is:
E = P x r x (1+r)^n / ((1+r)^n - 1)
- P is Principal Loan Amount
- r is Monthly Interest Rate (Annual Rate/12/100)
- n is Loan Tenure in Months
Home Loan vs. Personal Loan EMI
While the calculation logic is the same, the impact is different:
- Home Loans: Long tenure (15-30 years). Interest component is very high in the initial years.
- Personal Loans: Short tenure (1-5 years). Higher interest rates. Useful for immediate needs but costly.
- Car Loans: Medium tenure (3-7 years). Secured against the vehicle.
Frequently Asked Questions
Q. How can I reduce my EMI?
You can reduce your EMI by: 1. Increasing the loan tenure (but you pay more total interest). 2. Making a larger down payment to reduce the principal. 3. Negotiating a lower interest rate with the bank (requires good credit score).
Q. What is Pre-payment?
Paying an extra amount towards your loan principal is called pre-payment. This directly reduces your outstanding principal and can save you a significant amount of interest.