EMI Calculator (Loan, Home, Car and Personal)
How the formula works
EMI (equated monthly instalment) is the fixed amount you pay to the lender every month until the loan is fully repaid. Each EMI has two parts: interest on the loan that is still due, and a part of the principal. In the early years most of the EMI is interest. Later, more of it goes to the principal. This calculator finds the EMI for a loan, or the loan amount you can afford from an EMI that you choose, and it shows a yearly payment schedule.
Formulas
EMI = P × r × (1 + r)n ÷ ((1 + r)n − 1)
Loan amount from EMI: P = EMI × ((1 + r)n − 1) ÷ (r × (1 + r)n)
Total payment = EMI × n
Total interest = Total payment − Loan amount
Interest share = Total interest ÷ Total payment × 100
Where
- P = loan amount (the principal)
- r = monthly interest rate = annual rate ÷ 12 ÷ 100
- n = number of monthly payments = tenure in years × 12
How the schedule works
Each month, the interest is the outstanding balance × r. The rest of the EMI reduces the balance. The yearly schedule adds up the principal and the interest paid in each year and shows the balance at the end of that year.
How to use the calculator
- Select Find my monthly EMI, or Find the loan I can afford from an EMI.
- Select the currency and enter the amount (the loan amount, or the monthly EMI you can pay).
- Enter the interest rate per year and the tenure, and select years or months.
- Click Calculate. Open the yearly payment schedule to see the year by year breakup. You can also download the result as a PDF.
Important notes
- The calculator assumes a reducing balance loan with equal monthly payments at the end of each month.
- Your lender may show a slightly different EMI because of rounding, processing fees, insurance, or a floating interest rate.
- This is an estimate and not financial advice. Check the loan agreement for the exact terms.
Worked example
Example 1: Home loan EMI
You take a loan of 10,00,000 (INR) at 8.5 % per year for 20 years.
Step 1: r = 8.5 ÷ 12 ÷ 100 = 0.0070833 and n = 20 × 12 = 240
Step 2: EMI = 10,00,000 × 0.0070833 × (1.0070833)240 ÷ ((1.0070833)240 − 1) = 8,678.23
Step 3: Total payment = 8,678.23 × 240 = 20,82,775.76
Step 4: Total interest = 20,82,775.76 − 10,00,000 = 10,82,775.76
The interest is about 52.0 % of the total payment. In the first year you pay about 19,902 of principal and 84,236 of interest, and the balance at the end of year 1 is about 9,80,098.
Example 2: Shorter tenure
A loan of 50,00,000 at 9 % per year for 15 years.
EMI = 50,713.33
Total payment = 91,28,399.26
Total interest = 41,28,399.26, which is about 45.2 % of the total payment.
Example 3: Loan amount from EMI
You can pay an EMI of 25,000 per month. The interest rate is 9 % per year and the tenure is 20 years.
Loan you can afford = 25,000 × ((1.0075)240 − 1) ÷ (0.0075 × (1.0075)240) = 27,78,623.85
Total payment = 25,000 × 240 = 60,00,000
Total interest = 32,21,376.15, which is about 53.7 % of the total payment.
Common mistakes
- Entering the yearly rate as a monthly rate. Enter the rate per year, for example 8.5. The calculator converts it to a monthly rate.
- Mixing years and months. A tenure of 20 means 20 years if you select years, but only 20 months if you select months.
- Looking only at the EMI. A low EMI from a very long tenure can mean a very high total interest. Always check the total payment.
- Ignoring the fees. Processing fees, insurance and other charges are not part of the EMI formula, but they add to the real cost of the loan.
- Assuming a floating rate stays the same. If the rate changes, the EMI or the tenure changes. Check the effect of a higher rate.
- Confusing flat rate and reducing balance rate. A flat rate charges interest on the full original loan for the whole tenure, so the real cost is higher. This calculator uses the reducing balance method.
- Taking the maximum loan allowed. Keep your total EMIs within a safe share of your income so that you can handle other expenses and changes in income.
- Forgetting the down payment. Enter only the amount that you will borrow, not the full price of the house or the car.
Frequently asked questions
What is EMI?
EMI stands for equated monthly instalment. It is the fixed amount that you pay to the lender each month to repay a loan with interest over a set period.
How is EMI calculated?
EMI = P × r × (1 + r)n ÷ ((1 + r)n − 1), where P is the loan amount, r is the monthly interest rate and n is the number of months.
Does a longer tenure reduce the EMI?
Yes, a longer tenure lowers the monthly EMI, but you pay interest for more months, so the total interest is higher.
Does a higher interest rate raise the EMI?
Yes. Even a small increase in the rate raises the EMI and the total interest, especially on a long loan.
Why is most of my early EMI interest?
Interest is charged on the outstanding balance, which is highest at the start. As you repay the principal, the interest part falls and the principal part rises.
How can I reduce the total interest?
Choose a shorter tenure, make a bigger down payment, make part prepayments, or look for a lower interest rate.
How do I find the loan amount I can afford?
Select the option to find the loan from an EMI, then enter the monthly EMI you can pay, the interest rate and the tenure. The calculator gives the loan amount.
What is the difference between flat rate and reducing balance rate?
With a flat rate, interest is charged on the full original loan for the whole tenure. With a reducing balance rate, interest is charged only on the amount still due. This calculator uses the reducing balance method, which is the usual method for home and car loans.
Can I use this for a home, car or personal loan?
Yes. It works for any loan with equal monthly payments and a fixed interest rate. Choose your currency, or select No currency.
Will my bank show the same EMI?
It will be very close. Small differences can come from rounding, processing fees, insurance, or a floating rate. Check the loan agreement for the exact figure.