EMI Calculator Online
Calculate EMI instantly using our free loan calculator. Get your monthly installment, complete breakdown of total interest, and a detailed repayment schedule.
Monthly EMI
₹20,517
Principal + Interest per month
Total Interest
₹2,30,992
Total Amount Payable
₹12,30,992
How EMI is Calculated (Formula & Example)
EMI (Equated Monthly Installment) is the amount payable every month to the bank or any other financial institution until the loan amount is fully paid off. It consists of the interest on the loan as well as part of the principal amount to be repaid. The formula used for calculating EMI is:
EMI = [P × R × (1+R)N] / [(1+R)N - 1]
- P = Principal loan amount
- R = Rate of interest calculated on a monthly basis (i.e., R = Annual interest rate / 12 / 100)
- N = Loan tenure in months
Example Calculation
Suppose you take a loan of ₹5,00,000 at an interest rate of 10% per annum for a tenure of 5 years. Let's define the variables:
- P = ₹5,00,000
- R = 10 / 12 / 100 = 0.00833
- N = 5 years × 12 = 60 months
Using the formula, your EMI comes out to be ₹10,624. Over the 5 years, you will pay a total interest of ₹1,37,411, making your total repayment ₹6,37,411.
EMI for Different Loans
Home Loan EMI
Home loans usually have longer tenures (10-30 years) and lower interest rates. Since the principal amount is large, even a small reduction in the interest rate or making partly prepayments can save you lakhs of rupees in interest.
Car Loan EMI
Car loans have shorter tenures, typically ranging from 1 to 7 years. Our EMI calculator helps you balance your down payment against the monthly installment you're comfortable paying for your dream vehicle.
Personal Loan EMI
Personal loans are unsecured loans with higher interest rates and shorter tenures (1-5 years). Use the calculator to ensure the EMI fits perfectly within your monthly budget to avoid any default charges.
Frequently Asked Questions
How to calculate EMI manually?
You can calculate your EMI manually using the mathematical formula: EMI = P × r × (1+r)^n / ((1+r)^n − 1). Here P is the loan principal, r is the monthly interest rate (annual rate divided by 12 and 100), and n is the loan tenure in months.
What is the EMI formula?
The standard EMI formula is EMI = P * r * (1+r)^n / ((1+r)^n - 1), where P stands for Principal Amount, r for monthly interest rate, and n for number of months.
Does EMI change with interest rate?
Yes, if you have a floating interest rate loan, your EMI or loan tenure will change when the bank revises their base lending rates. If you have a fixed interest rate loan, your EMI remains constant throughout the tenure.
How to reduce EMI?
You can reduce your EMI by making a higher down payment initially, opting for a longer loan tenure, negotiating a lower interest rate, or making part-prepayments during the loan tenure which brings down the outstanding principal.
What happens if I prepay my loan?
When you prepay your loan (either partly or fully), it directly reduces your outstanding principal amount. This in turn completely saves the interest you would have paid on that amount, often reducing either your future EMI amount or your overall loan tenure.
Is EMI calculated monthly?
Yes, EMI stands for Equated Monthly Installment. It is a fixed payment amount made by a borrower to a lender at a specified date each calendar month.
What is reducing balance interest?
In a reducing balance interest method, the interest is calculated only on the remaining outstanding principal amount, which reduces every month after the principal component of your EMI is paid.
Is this EMI calculator accurate?
Yes, our EMI Calculator uses standard universal mathematical formulas accepted by all banks and financial institutions in India and globally. However, the final EMI may vary slightly depending on processing fees or specific bank-level rounding rules.
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