EMI stands for Equated Monthly Installment. It is the fixed amount you pay to the lender every month until your loan is fully repaid. The EMI includes both principal repayment and interest charged on the outstanding loan amount. Each month, a portion of your EMI goes toward repaying the principal amount borrowed, while the remaining portion covers the interest. In the early months, a larger portion goes toward interest, and as you progress, more goes toward principal repayment.

How is EMI calculated?

EMI is calculated using the 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 For example, for a loan of 100,000 at 10% annual interest for 1 year (12 months): - P = 100,000 - r = 10 / 12 / 100 = 0.00833 - n = 12 - EMI = 8,791.59 per month

What factors affect EMI amount?

Three main factors affect your EMI: 1. Loan Amount (Principal): Higher loan amount = Higher EMI 2. Interest Rate: Higher interest rate = Higher EMI 3. Loan Tenure: Longer tenure = Lower EMI (but more total interest) To reduce your EMI, you can: - Make a larger down payment to reduce principal - Negotiate a lower interest rate - Choose a longer tenure (though this increases total interest) - Prepay part of the loan to reduce outstanding principal

Should I choose a longer or shorter loan tenure?

The choice depends on your financial situation: Shorter Tenure (e.g., 1-3 years): - Pros: Lower total interest, faster debt freedom - Cons: Higher monthly EMI, more financial pressure Longer Tenure (e.g., 10-20 years): - Pros: Lower monthly EMI, easier to manage cash flow - Cons: Much higher total interest paid over time Recommendation: Choose the shortest tenure you can comfortably afford. This saves significant interest while maintaining financial stability. You can also opt for longer tenure with the option to prepay when you have surplus funds.

Can I prepay my loan to reduce EMI or tenure?

Yes, most loans allow prepayment, though some may have prepayment charges (especially home loans). When you prepay, you can choose: 1. Reduce EMI: Keep the same tenure, lower monthly payments 2. Reduce Tenure: Keep the same EMI, finish loan faster Reducing tenure is usually better because: - You save more on total interest - Become debt-free sooner - EMI remains the same, so no lifestyle adjustment needed Check your loan agreement for: - Prepayment charges (if any) - Minimum prepayment amount - Prepayment frequency limits For floating rate loans in India, prepayment is usually free. For fixed rate loans, there may be a penalty (typically 2-3% of outstanding principal).

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EMI Calculator

Calculate your monthly loan EMI (Equated Monthly Installment) with detailed breakdowns of principal, interest, and total payment.

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How to Use EMI Calculator

How to Use the EMI Calculator:

Enter your Loan Amount (principal) - the total amount you want to borrow
Enter Annual Interest Rate (%) - the yearly interest rate offered by the lender
Select Loan Tenure:
- Choose between Years or Months from the dropdown
- Enter the loan duration (e.g., 5 years or 60 months)
Results are calculated automatically as you type
View your Monthly EMI payment amount
See the breakdown of:
- Principal Amount (loan amount)
- Total Payment (principal + interest)
- Total Interest (interest paid over entire tenure)
Copy or share your results

The 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

Try the example scenarios for Home Loan, Car Loan, or Personal Loan to see typical EMI calculations.

Frequently Asked Questions

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EMI Calculator

How to Use EMI Calculator

Frequently Asked Questions

What is EMI?

How is EMI calculated?

What factors affect EMI amount?

Should I choose a longer or shorter loan tenure?

Can I prepay my loan to reduce EMI or tenure?

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