EMI Calculator

EMI = P × r × (1+r)ⁿ ÷ ((1+r)ⁿ − 1), where P is the loan amount, r the monthly interest rate, and n the number of months. Every Indian bank uses this reducing-balance formula for home, car and personal loans.

A flat rate charges interest on the original loan for the entire tenure; a reducing rate charges interest only on the outstanding balance. A 7% flat rate costs roughly the same as a 13% reducing rate — always convert before comparing loan offers.

Three levers: negotiate a lower rate (even 0.25% matters), extend the tenure, or increase the down payment. If your loan is already running, a balance transfer to a cheaper lender or part-prepayment will cut either the EMI or the tenure.

Prepaying a 9% loan earns you a guaranteed, tax-free 9% return — hard to beat with safe investments. If you can reliably earn more post-tax than your loan rate, investing wins; otherwise prepay, especially in the early years.

Banks round EMIs to the nearest rupee, may use daily rather than monthly reducing balance, and count from the actual disbursement date. Differences of a few rupees are normal and even out over the tenure.

On floating-rate loans, most banks keep the EMI constant and extend or shorten the tenure instead. Some adjust the EMI directly. Either way, a rate cut saves you money; a rate hike costs you — model both scenarios here.