Tool
EMI Calculator
Your monthly EMI, total interest over the loan term, and how much extra payments can save you.
How EMI is calculated
EMI stands for Equated Monthly Instalment. Every month you pay a fixed amount — part of it covers the interest for that month, and the rest chips away at the principal. In the early years, most of your EMI is interest. That flips gradually over time.
On a ₹30 lakh home loan at 8.5% for 20 years, your EMI is ₹26,035/month. In month one, ₹21,250 goes to interest and only ₹4,785 reduces the loan. By year 15, the split has reversed.
The formula
Example: ₹30,00,000 loan at 8.5%/year for 20 years →
r = 8.5% ÷ 12 = 0.708% per month (0.00708), n = 240 months
EMI = 30,00,000 × 0.00708 × (1.00708)240 ÷ [(1.00708)240 − 1] = ₹26,035/month
Total repaid: ₹62.5 lakhs — ₹32.5 lakhs is interest on a ₹30 lakh loan.
Why prepaying early is so powerful
Because the interest in the early years is huge. A ₹1 lakh prepayment in year 3 of the above loan saves approximately ₹2.8 lakhs in total interest and cuts 14 months off your tenure. The same ₹1 lakh prepayment in year 15 saves less than ₹50,000. Use the "extra payment" input above to model your own scenario.
Frequently Asked Questions
How much home loan can I get on ₹1 lakh salary?
Banks typically allow total EMI obligations up to 40–55% of gross monthly income. At ₹1 lakh salary, that's ₹40–55k/month in EMI capacity, which corresponds to a home loan of ₹46–63 lakhs at current rates (8–9%). Your existing EMIs (car loan, personal loan) reduce this figure.
Fixed rate vs floating rate — which is better?
Floating rates in India have historically been lower over long loan tenures, but they carry uncertainty. If rates rise by 1–2%, your EMI jumps or tenure extends. Fixed rates give certainty but start higher. For a 20-year loan, most borrowers go floating and bet on rates stabilising or falling.
Does prepaying a home loan make sense?
Almost always yes in the first half of tenure. The guaranteed interest saving (8.5%) beats what a liquid fund or FD earns after tax. The exception: if you have high-interest debt elsewhere (credit card, personal loan), clear that first.