Your EMI (equated monthly instalment) is the fixed amount you pay the lender every month until the loan is repaid. Part of each EMI pays interest and the rest reduces the loan. In the early years most of the EMI goes towards interest; towards the end, most of it repays principal. Open the year-by-year schedule above to see exactly how that shifts.
How to use the calculator
Enter the loan amount, the annual interest rate quoted by your lender and the tenure in years. The EMI, total interest and total amount payable update as you type. The amount box also shows the figure in lakh or crore, so it is easy to check you have typed the right number of zeros.
Example: a ₹30 lakh home loan
At 8.5% for 20 years, the EMI is about ₹26,035. Over the full term you would pay roughly ₹32.48 lakh in interest, more than the loan itself.
- Shorter tenure: the same loan over 15 years costs ₹29,542 a month, about ₹3,500 more, but total interest falls to about ₹23.18 lakh, a saving of over ₹9 lakh.
- Lower rate: at 8% for 20 years the EMI drops to ₹25,093 and total interest to about ₹30.22 lakh. Half a percentage point is worth more than ₹2 lakh over 20 years.
Ways to pay less interest
- Prepay when you can. Even one extra EMI a year cuts years off a long home loan. For floating-rate loans taken by individuals, RBI rules do not allow lenders to charge prepayment or foreclosure penalties.
- Watch the benchmark. Most new floating-rate home loans are linked to an external benchmark such as the RBI repo rate, so your rate moves after RBI policy decisions. Ask your bank whether it is reducing your EMI or your tenure when rates change.
- Compare the full cost. Processing fees, insurance bundled with the loan and legal charges add to the cost and are not part of the EMI shown here.
