EMI Calculator
EMI calculator.
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Enter values and click Calculate
🧮 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
Frequently Asked Questions
What is EMI and how is it calculated?
EMI (Equated Monthly Installment) is the fixed monthly payment you make to repay a loan. It includes both principal and interest components. The formula ensures equal payments throughout the tenure.
How can I reduce my EMI?
You can reduce EMI by: (1) Negotiating a lower interest rate, (2) Extending the loan tenure (increases total interest), (3) Making a larger down payment, (4) Transferring to a bank with lower rates.
What happens if I prepay my loan?
Prepayment reduces your outstanding principal, which can either reduce your EMI or shorten your tenure. Most banks don't charge prepayment penalties on floating rate loans. Even small prepayments can save lakhs in interest.
What is the ideal EMI-to-income ratio?
Financial experts recommend keeping total EMIs below 40% of your monthly income. For home loans specifically, the EMI should not exceed 30% of your income to maintain financial health.
Does a longer tenure always mean more interest?
Yes, a longer tenure reduces your monthly EMI but increases total interest paid significantly. A 20-year home loan can cost 50-70% more in interest compared to a 10-year tenure.