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Loans, savings & money calculators
Loan EMI Calculator
EMI, total interest, and a full amortisation schedule — with integrated prepayment (reduce EMI or tenure) and multi-loan compare. Accurate, instant and free — for India · US.
What these mean:
What these mean:
What these mean:
₹50,00,000 loan at 8.5% for 20 years — EMI ₹43,391/month, total interest ₹54,13,879.
Principal vs. Interest
- Principal · 48%₹50,00,000
- Interest · 52%₹54,13,879
Remaining balance
240 mosRate comparison
| Rate scenario | EMI / mo | Total interest |
|---|---|---|
| 7.50% rate | ₹40,280 | ₹46,67,118 |
| 8.50% rate (current) | ₹43,391 | ₹54,13,879 |
| 9.50% rate | ₹46,607 | ₹61,85,574 |
How EMI, total interest, and prepayment savings are calculated
This calculator uses the standard reducing-balance (diminishing-balance) method — the same convention used by banks in India for home, car, and personal loans. Interest is computed on the outstanding balance each month, not the original principal. Results cross-checked against emicalculator.net and BankBazaar.
EMI formula
Reducing-balance method
EMI = P × r × (1+r)^n ÷ ((1+r)^n − 1)
- P = principal loan amount
- r = monthly rate (annual rate ÷ 12)
- n = tenure in months
Total interest = (EMI × n) − P. Each month's interest = outstanding balance × r.
Prepayment engine
Reduce-EMI or reduce-tenure
New balance = old balance − prepayment
- Reduce-tenure: recompute n at same EMI
- Reduce-EMI: recompute EMI at same n
- Supports multiple prepayments at any month
- Savings = interest on original schedule − interest after prepayment
- 1Base EMI — ₹50,00,000 @ 8.5% for 20 years: Monthly rate r = 8.5%/12 ≈ 0.007083. n = 240 months. EMI = 50,00,000 × 0.007083 × (1.007083)^240 ÷ ((1.007083)^240 − 1) ≈ ₹43,391. Total paid = 43,391 × 240 = ₹1,04,13,840. Total interest = ₹54.14L.
- 2Prepay ₹5L at month 12 — reduce-tenure mode: After 12 months of EMI, outstanding balance ≈ ₹48.33L. After ₹5L prepayment: new balance ≈ ₹43.33L. Recompute remaining n at same EMI ₹43,391 and rate 8.5% → remaining tenure ≈ 180 months (was 228). Total tenure = 12 + 180 = 192 months — saves 48 months and ≈₹16.04L interest.
Floating vs fixed rate
Why early EMIs are mostly interest — the front-loading effect
With reducing-balance EMI, interest is computed on the outstanding balance each month. In the early years the balance is close to the original principal, so almost every rupee goes toward interest — not repayment. This is called front-loading, and it is why prepaying early in the tenure saves far more than prepaying near the end.
| Year | Opening balance | Total EMI paid | Interest | Principal repaid | Closing balance |
|---|---|---|---|---|---|
| Year 1 | ₹50,00,000 | ₹5,20,692 | ₹4,19,826 | ₹1,00,866 | ₹48,99,134 |
| Year 5 | ₹44,88,000 | ₹5,20,692 | ₹3,65,000 | ₹1,55,692 | ₹43,32,308 |
| Year 10 | ₹36,90,000 | ₹5,20,692 | ₹2,82,000 | ₹2,38,692 | ₹34,51,308 |
| Year 15 | ₹23,60,000 | ₹5,20,692 | ₹1,57,000 | ₹3,63,692 | ₹19,96,308 |
| Year 20 | ₹4,42,000 | ₹5,20,692 | ₹18,000 | ₹4,42,000 | ₹0 |
Illustrative amortisation for ₹50,00,000 @ 8.5% / 20y. Values rounded to nearest thousand. Notice: Year 1 interest ≈ 81% of EMI; Year 20 interest ≈ 3% of EMI.
Prepay early — the multiplier is largest in the first 5 years
Reduce EMI vs reduce tenure — which saves more?
After a prepayment, banks typically let you choose between two modes. Reduce-tenure keeps your EMI unchanged and shortens the loan period — every future month you save the full interest on the prepaid principal. Reduce-EMI keeps tenure unchanged but lowers the monthly payment — useful if cash flow is the constraint.
Reduce-tenure (recommended)
Same EMI — loan closes sooner
₹5L prepay @ month 12 — ₹50L @ 8.5% / 20y
48 months saved
₹16.04L interest saved
Best when you can sustain the existing EMI and want to maximise interest savings. Interest compounds on a lower balance for fewer months — the saving is multiplicative.
Reduce-EMI
Same tenure — lower monthly payment
₹5L prepay @ month 12 — ₹50L @ 8.5% / 20y
EMI ↓ to ≈₹39,700
≈₹8.5L interest saved (less than reduce-tenure)
Best when monthly outflow is the binding constraint — e.g. FOIR is tight or income is variable. Saves less total interest than reduce-tenure on the same prepayment.
FOIR: how much EMI can you afford?
Banks use the Fixed Obligation to Income Ratio (FOIR) — the share of your monthly take-home income that goes to all loan EMIs combined. Most lenders cap FOIR at 40–50% of net monthly income. If your existing EMIs plus the proposed new EMI exceed this, the loan is likely to be declined or the sanctioned amount will be lower.
To check your take-home income, use the Take-Home Salary Calculator — it shows your net monthly income after tax across India, UK, and US tax regimes.
FOIR varies by lender — verify with your bank
Frequently asked questions
EMI uses the reducing-balance formula: EMI = P·r·(1+r)ⁿ / ((1+r)ⁿ−1), where P = principal, r = monthly rate (annual ÷ 12), and n = tenure in months. For ₹50,00,000 @ 8.5% / 20y: r ≈ 0.007083, n = 240 → EMI ≈ ₹43,391, total interest ≈ ₹54.14L. See the Compound Interest Calculator for lump-sum projections.
Prepayment cuts interest by reducing outstanding principal. For ₹50,00,000 @ 8.5% / 20y, a ₹5L prepayment at month 12 (reduce-tenure) shaves ≈ 48 months and saves ≈ ₹16.04L in interest. Earlier prepayments save more. See Home Loan Prepayment Calculator for the after-tax saving including §24(b).
Reduce tenure = more interest saved (loan closed sooner). Reduce EMI = lower monthly outflow, better cash flow. If you can sustain the existing EMI, reduce tenure — it saves substantially more. See Home Loan Prepayment Calculator for a side-by-side comparison.
Arrears EMI (standard) is paid at the end of each period — your first payment is due one month after disbursement. Advance EMI is collected at the start — the first EMI is deducted at disbursement. Most home, car, and personal loans in India use the arrears (end-of-period) convention. This calculator uses arrears by default, which matches the standard reducing-balance schedule used by banks.
An amortisation schedule shows every EMI split into principal and interest. Early months are mostly interest; later months are mostly principal repayment. The EMI stays constant but the mix shifts. See the Mortgage Overpayment Calculator for a UK reduce-term vs reduce-payment breakdown.
Method, assumptions & references
Fixed-rate projection; floating rates change the schedule. Reducing-balance method. Not a loan offer. EMI formula: P·r·(1+r)ⁿ/((1+r)ⁿ−1); r = annual rate ÷ 12; n = tenure in months. Prepayment reduces outstanding balance; reduce-tenure recomputes n at same EMI; reduce-EMI recomputes EMI at same n. Golden: ₹50,00,000 @ 8.5% / 20y → EMI ₹43,391, total interest ₹54.14L; prepay ₹5L @ month 12 reduce-tenure → 48 months saved, ₹16.04L saved. Results cross-validated against emicalculator.net and SEBI investor portal.
How we calculate this
Reviewed by Reckonist Editorial · Last reviewed 17 June 2026. Figures follow the methods and sources set out in our editorial standards.
Fixed-rate projection; floating rates change the schedule; reducing-balance method; not a loan offer.
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