EMI Calculator

An EMI, or Equated Monthly Instalment, is the fixed amount you pay a lender every month until a loan is fully repaid. Each instalment contains two things: interest for the month just gone, and a slice of the principal you still owe. The total stays the same month after month, but the split between those two parts shifts steadily in your favour.

This calculator is for anyone comparing loan offers — a first-time home buyer weighing a 20-year loan against a 15-year one, a salaried professional checking whether a car loan fits the monthly budget, or someone deciding whether a personal loan at 14% is worth taking at all. Move the sliders and you will see the monthly EMI, the total interest you will pay across the life of the loan, and the total outgo.

How EMI is calculated

The EMI formula is a rearranged present-value equation. In plain words: it is the monthly payment that makes the present value of all your future instalments exactly equal to the amount you borrowed today.

EMI = P × r × (1+r)ⁿ ÷ [(1+r)ⁿ − 1]

• P = loan amount (principal)
• r = monthly interest rate, which is the annual rate divided by 12 and then by 100
• n = number of monthly instalments, which is years × 12

A rate of 8.5% per year becomes a monthly rate of 0.0070833. That small number is what actually drives the arithmetic, which is why a difference of half a percentage point on paper turns into lakhs of rupees over twenty years.

Three worked examples

1. Home loan: ₹30,00,000 at 8.5% for 20 years

Monthly rate is 8.5 ÷ 12 ÷ 100 = 0.00708333, and n = 240. Plugging into the formula gives an EMI of ₹26,035. Over 240 months you pay ₹62,48,327 in all, of which ₹32,48,327 is interest — slightly more than the amount you borrowed.

2. Car loan: ₹8,00,000 at 9.5% for 5 years

Car loans run short, so the interest bill is far smaller in proportion. The EMI works out to ₹16,801, total repayment ₹10,08,089, and total interest ₹2,08,089 — about 26 paise of interest for every rupee borrowed, against 108 paise on the home loan above. The lesson is that tenure, not the headline rate, is what makes a loan expensive.

3. Personal loan: ₹3,00,000 at 14% for 3 years

Unsecured personal loans carry the highest rates because the lender has no collateral. At 14% for 36 months the EMI is ₹10,253 and the total interest is ₹69,118 on a ₹3,00,000 loan. Note that most personal loans also carry a processing fee of 1% to 3%, so the effective cost is higher than the quoted rate.

Why early EMIs are mostly interest

Amortisation is the schedule that shows how each EMI is split between interest and principal. Take the ₹30,00,000 home loan at 8.5% for 20 years. In the very first month, interest is ₹30,00,000 × 0.00708333 = ₹21,250, so only ₹4,785 of your ₹26,035 EMI reduces the loan. By year 15 the balance has fallen far enough that the split has reversed.

Two practical consequences follow. First, after paying EMIs for five full years on this loan you have cleared only ₹3,56,185 of the ₹30,00,000 — the outstanding balance is still ₹26,43,815. Second, this is exactly why prepayment early in the tenure is so powerful: a rupee paid into principal in year 3 removes seventeen years of future interest on that rupee, while the same rupee in year 17 removes only three.

Use the amortisation button above the article to see the year-wise split for whatever numbers you have entered in the calculator.

Tenure vs rate: what moves your EMI

Borrowers usually negotiate hard on the interest rate and accept whatever tenure the lender suggests. Both matter, but they pull in different directions. Stretching the tenure lowers the EMI and raises total interest. Here is the same ₹30,00,000 loan at 8.5% across different tenures.

Going from 20 to 30 years cuts the EMI by ₹2,968 a month but adds ₹20,55,939 of interest. Going from 20 to 15 years costs ₹3,507 more each month and saves ₹9,30,733. In practice, take the longest tenure you can get so that your committed EMI is low, then prepay aggressively — you keep the flexibility of the low EMI and still finish early.

Now hold tenure at 20 years and vary the rate.

Half a percentage point on a ₹30 lakh home loan is worth roughly ₹2.3 lakh over twenty years. That is worth one phone call to your existing lender asking for a rate reset, and worth checking a balance transfer if they refuse.

Fixed vs floating (repo-linked) rates

Since October 2019 the RBI has required banks to link new floating-rate retail loans to an external benchmark. In practice almost every bank uses the repo rate, and the resulting rate is called the External Benchmark Lending Rate (EBLR) or Repo Linked Lending Rate (RLLR). Your rate is then repo rate + bank spread + a risk premium based on your credit score and loan-to-value ratio.

As of September 2026 the RBI repo rate is 5.25%, unchanged since the August 2026 policy review. A bank quoting you "repo + 3.00%" is therefore offering 8.25%. When the repo rate moves, EBLR-linked loans must be reset within three months, so the pass-through is quick in both directions. Older MCLR-linked loans reset only on their annual reset date, which is why borrowers still on MCLR often pay more than new borrowers at the same bank.

Fixed-rate home loans exist but are rare and usually cost 1% to 2% more, and many are "fixed" only for the first two or three years. Personal loans and most car loans, by contrast, are almost always genuinely fixed for the full tenure. The distinction matters for prepayment, as the next section explains.

Prepayment and foreclosure rules

This is the area where borrowers most often lose money to bad information. The RBI issued the Reserve Bank of India (Pre-payment Charges on Loans) Directions, 2025 on 2 July 2025, and they apply to all loans sanctioned or renewed on or after 1 January 2026.

Under those directions, regulated entities — banks, NBFCs and housing finance companies — cannot levy prepayment or foreclosure charges on floating-rate loans taken by an individual for a purpose other than business. That covers home loans, education loans and personal loans, and it applies regardless of the loan amount, the source of the money used to prepay, or whether there is a co-borrower. The protection was also extended to floating-rate loans to micro and small enterprises. Lenders must disclose any applicable charges upfront in the sanction letter and cannot impose them retrospectively.

What is not covered: fixed-rate loans. If your loan carries a genuinely fixed rate, the lender may still charge a foreclosure fee, commonly 2% to 5% of the outstanding principal, and many personal loans also impose a lock-in of six to twelve EMIs before you may foreclose at all. Always read the foreclosure clause before signing, not when you want to close the loan.

When you do prepay a home loan, the lender will ask whether you want to reduce the EMI or reduce the tenure. Reducing the tenure saves far more interest, because you keep paying the same amount while the balance shrinks faster. Reducing the EMI helps cash flow. Our guide on closing a home loan early works through both options with numbers.

Processing fees and hidden costs

The EMI is not the whole cost of a loan. Budget for these as well:

• Processing fee — typically 0.25% to 1% of the loan for home loans (often capped, and frequently waived during festive offers), 1% to 2% for car loans, and 1% to 3% for personal loans. GST at 18% applies on the fee.
• Legal and technical valuation charges — usually ₹3,000 to ₹10,000 on a home loan, sometimes bundled into the processing fee.
• Stamp duty on the loan agreement and mortgage — varies by state and can run to several thousand rupees.
• Property insurance or loan protection cover — frequently sold alongside a home loan. It is not mandatory to buy it from the lender, and a plain term insurance policy is usually cheaper.
• CERSAI registration and document retrieval charges — small, but they exist.

A useful habit when comparing two offers: add the processing fee and all one-time charges to the loan amount, recompute the EMI in this calculator, and compare the resulting effective rate rather than the advertised one.

How much EMI can you afford?

Lenders assess your Fixed Obligations to Income Ratio, or FOIR — the share of your net monthly income already committed to EMIs, including the new loan. Most banks cap FOIR at 50%, and are stricter at lower income levels. As a personal rule of thumb, keep all EMIs put together at 40% of net take-home pay or less, and keep the home loan EMI alone below 35%.

Common mistakes worth avoiding: borrowing to the maximum the bank sanctions rather than the amount you actually need; ignoring the fact that a home purchase brings maintenance, property tax and society charges on top of the EMI; taking a top-up loan for a holiday or a wedding at home-loan tenure; and letting a low credit score push your rate up by a full percentage point when three months of clean repayment history would have fixed it.