Loan EMI Calculator
Calculate the exact monthly EMI (Equated Monthly Installment) for any loan — home, car, personal or education. You'll also see the total interest you'll pay over the full tenure, which is the number lenders don't advertise.
How to use this calculator
- Enter the loan amount you plan to borrow (the principal).
- Enter the annual interest rate your lender quotes (e.g. 9 for 9%).
- Enter the tenure in years and press Calculate.
- Check the total interest row — shortening the tenure or prepaying reduces this dramatically.
Formula used
Where P is the loan amount, i is the monthly interest rate (annual rate ÷ 12 ÷ 100), and N is the tenure in months. This is the standard reducing-balance formula used by virtually all banks.
Example calculation
A home loan of 2,500,000 at 9% per year for 20 years:
i = 0.0075, N = 240 → EMI = 22,493 per month. Total payment ≈ 5,398,355, meaning total interest of about 2,898,355 — more than the loan itself. The same loan over 15 years costs 25,357/month but saves over 830,000 in interest.
What is an EMI?
An EMI (Equated Monthly Installment) is the fixed amount you pay your lender every month until a loan is fully repaid. Each EMI contains two parts: interest on the outstanding balance, and repayment of principal. Early in the loan, most of the EMI is interest; as the balance shrinks, more of each payment goes toward principal — this is called amortization.
Because the EMI is fixed, the formula balances the loan so that the final payment brings the balance exactly to zero. Understanding the split helps you see why prepayments in the early years save the most interest.
Why use this calculator?
- Know your exact monthly commitment before signing a loan agreement — and check it against the lender's quote.
- Compare tenures side by side: a longer tenure lowers the EMI but can double the total interest.
- Plan prepayments by seeing how much of your money is going to interest versus principal.
Frequently asked questions
How is EMI calculated on a home loan?
Banks use the reducing-balance formula EMI = P × i × (1+i)^N / [(1+i)^N − 1], where i is the monthly rate and N the number of months. Interest is charged only on the outstanding balance, which falls with every payment.
Does a longer tenure make my loan cheaper?
No — it makes the EMI smaller but the loan more expensive. Interest accrues for more months, so total interest rises sharply. Choose the shortest tenure whose EMI you can comfortably afford.
What happens to my EMI if interest rates change?
On a floating-rate loan, lenders usually keep the EMI the same and extend or shorten the tenure when rates move. You can ask the lender to adjust the EMI instead. Fixed-rate loans keep both EMI and tenure constant.
Is it better to prepay a loan or invest the money?
Compare rates: prepaying a 9% loan is equivalent to earning a guaranteed 9% return, tax-free. If you can reliably earn more than your loan rate after tax elsewhere, investing can win — but prepayment is the risk-free option.