Welcome to our Free Loan Calculator, an essential tool for anyone considering borrowing money. Whether you're planning to buy a home, car, fund education, or need a personal loan, understanding your Equated Monthly Installment (EMI) and total repayment amount is crucial for smart financial planning.
Plan your budget accurately by knowing exactly how much you need to pay each month.
Compare different loan offers from various banks and financial institutions.
Know the total interest you'll pay over the loan term to avoid financial surprises.
Plan loan prepayment or closure by understanding the amortization schedule.
EMI is the fixed monthly payment you make to the lender, which includes both principal repayment and interest. Our calculator uses the standard EMI formula:
EMI = [P × R × (1+R)^N] / [(1+R)^N-1]
Where:
P = Principal Loan Amount
R = Monthly Interest Rate (Annual Rate ÷ 12 ÷ 100)
N = Loan Tenure in Months
The actual amount you borrow from the lender. This is the base amount on which interest is calculated.
The percentage charged by the lender for borrowing money. Interest rates can be fixed (remains constant) or floating (changes with market rates).
The duration for which you borrow the money, typically expressed in years or months. Longer tenures mean lower EMI but higher total interest.
A detailed table showing the breakdown of each EMI payment into principal and interest components, along with the outstanding balance after each payment.
Increasing your down payment reduces the principal amount, which in turn reduces both EMI and total interest.
While shorter tenures increase EMI, they significantly reduce total interest paid over the loan term.
Use windfalls like bonuses, tax refunds, or inheritance to make partial prepayments, which reduce the outstanding principal.
Improve your credit score, maintain a good relationship with your bank, and compare offers to get the best interest rate.
Our loan calculator uses standard financial formulas and provides highly accurate results. The calculations match those used by banks and financial institutions. However, actual loan terms may include additional charges like processing fees, insurance, or GST, which are not included in our basic calculation.
Reducing Balance: Interest is calculated on the outstanding principal, which reduces with each EMI payment. This method is fairer and used by most banks today.
Flat Rate: Interest is calculated on the original principal for the entire loan tenure, resulting in higher interest payments. Our calculator uses the reducing balance method.
Our calculator assumes a fixed interest rate for the entire loan tenure. For floating rate loans, you can use the calculator to get an estimate based on current rates. However, actual EMIs may change when interest rates are revised by the lender.
An amortization schedule is a table that shows the breakdown of each EMI payment into principal and interest components. It's important because it helps you understand how much of your payment goes toward reducing the principal versus paying interest. This information is crucial for planning prepayments and understanding the true cost of your loan.
Longer loan tenures reduce your EMI but significantly increase the total interest paid. For example, a ₹10 lakh loan at 8% interest for 10 years results in ₹4.38 lakhs interest, while the same loan for 20 years results in ₹9.31 lakhs interest - more than double! Always choose the shortest tenure you can afford.
Yes, loans often come with additional charges not included in basic EMI calculations: processing fees (0.5%-2%), prepayment charges, late payment fees, documentation charges, and insurance premiums. Always read the loan agreement carefully and ask your lender about all charges before signing.
Our Free Loan Calculator empowers you to make informed financial decisions. Whether you're planning to buy your dream home, upgrade your car, fund education, or need personal financing, understanding the numbers is the first step toward financial responsibility.
Start calculating today and take control of your financial future. Use our detailed amortization schedule to plan prepayments, compare different loan offers, and choose the option that best fits your financial situation.
Note: This calculator provides estimates based on standard formulas. Actual loan terms may vary based on your credit profile, lender policies, and market conditions. Always consult with a financial advisor before making major financial decisions.