How to use the EMI Calculator
- 1
Enter the loan amount.
- 2
Enter the interest rate per year quoted by the lender.
- 3
Choose the loan tenure in years.
- 4
Read the monthly EMI, total interest and total payment, and check the yearly outstanding balance.
The formula
EMI = L × r × (1 + r)^n ÷ ((1 + r)^n − 1)L is the loan amount, r is the monthly interest rate (annual rate ÷ 12 ÷ 100) and n is the tenure in months.
Worked example
A home loan of ₹30 lakh at 8.5% for 20 years has an EMI of about ₹26,035. Over 240 months you pay roughly ₹62.48 lakh, of which about ₹32.48 lakh is interest.
Tips
- Keep total EMIs within a comfortable share of take-home pay so your SIPs and emergency fund are not squeezed.
- A shorter tenure raises the EMI but cuts total interest sharply; compare both before deciding.
- Floating rates change over time, so re-check your EMI or tenure whenever the lender revises the rate.
Frequently asked questions
What is the EMI for a ₹30 lakh home loan?
At 8.5% a year for 20 years, the EMI on ₹30 lakh is about ₹26,035 a month. The total interest over the loan is about ₹32.48 lakh. A different rate or tenure changes both figures, so enter your lender's actual terms.
Should I prepay my home loan or invest in a SIP?
It depends on your loan rate, tax benefits and comfort with market risk. Prepaying gives a certain saving equal to the loan rate, while a SIP may earn more or less. Many families split surplus money between both, keeping an emergency fund first.
Why is so much of my early EMI going to interest?
Interest is charged on the outstanding balance, which is highest at the start. So early EMIs are mostly interest and later EMIs are mostly principal. Prepayments made in the early years therefore save more interest than the same amount paid later.
Does this EMI calculator include processing fees and insurance?
No, it covers only principal and interest. Processing fees, loan insurance premiums and other charges are extra and vary by lender. Ask the lender for the full cost and the annual percentage rate before comparing offers.