Loan Calculator
Work out the monthly payment (EMI) on a personal, car or student loan, the total interest you will pay, and a year-by-year repayment schedule.
| Year | Principal paid | Interest paid | Balance |
|---|
How to use the loan calculator
- Enter the amount you want to borrow.
- Add the yearly interest rate your lender quoted (APR).
- Set the loan term in years or months and pick your currency.
- Read your monthly payment, total interest and the amortization schedule below it.
Formula: monthly payment = P × r ÷ (1 − (1 + r)−n), where P is the loan amount, r is the monthly interest rate (yearly rate ÷ 12) and n is the number of monthly payments. This is the standard EMI formula used by banks for fixed-rate loans.
Frequently asked questions
What is EMI?
EMI stands for Equated Monthly Instalment — the fixed amount you pay every month until the loan is repaid. Early payments are mostly interest; later ones are mostly principal.
Does this include fees or insurance?
No. It covers principal and interest only. Processing fees, insurance and taxes vary by lender, so add them separately.
How can I pay less interest?
Borrow less, choose a shorter term, find a lower rate, or make extra payments toward principal. The schedule shows how much interest each year costs.
What does a loan calculator do?
A loan calculator turns three numbers (how much you borrow, the yearly interest rate and the repayment period) into the fixed monthly payment a lender will ask for. In India this payment is called the EMI, so the same tool is often searched for as an EMI calculator; in the US and UK it is usually just called the monthly payment.
It works for any fixed-rate loan that is repaid in equal monthly instalments: personal loans, car loans, education loans, consumer durable loans and most small business loans. Everything is calculated in your browser, so nothing you type is sent anywhere. The results are estimates of principal and interest only; your lender’s final figure can differ slightly because of rounding, fees or the exact date your first payment falls due.
Worked example: personal loan EMI for ₹5 lakh
Say you take a personal loan of ₹5,00,000 at 11% a year for 5 years. Here is how the EMI is worked out step by step:
- Monthly rate: r = 11 ÷ 12 ÷ 100 = 0.0091667.
- Number of payments: n = 5 × 12 = 60.
- EMI: 5,00,000 × 0.0091667 ÷ (1 − 1.0091667−60) = ₹10,871 a month (₹10,871.21 before rounding).
- Total repaid: ₹10,871.21 × 60 = about ₹6,52,273.
- Total interest: ₹6,52,273 − ₹5,00,000 = about ₹1,52,273.
In the first month, interest is ₹5,00,000 × 0.0091667 = ₹4,583, so only ₹6,288 of your first EMI reduces the balance. As the balance falls, the interest part shrinks and the principal part grows. That is why the amortization table above shows most of the interest being paid in the early years.
EMI table: ₹5 lakh and $10,000 loans
The tables below use the same formula as the calculator. Figures are rounded and cover principal and interest only.
₹5,00,000 personal loan
| Interest rate | Tenure | Monthly EMI | Total interest |
|---|---|---|---|
| 10.5% | 3 years | ₹16,251 | ₹85,044 |
| 10.5% | 5 years | ₹10,747 | ₹1,44,817 |
| 12% | 3 years | ₹16,607 | ₹97,858 |
| 12% | 5 years | ₹11,122 | ₹1,67,333 |
| 14% | 3 years | ₹17,089 | ₹1,15,197 |
| 14% | 5 years | ₹11,634 | ₹1,98,048 |
$10,000 loan
| Interest rate (APR) | Term | Monthly payment | Total interest |
|---|---|---|---|
| 7% | 3 years | $308.77 | $1,115.75 |
| 7% | 5 years | $198.01 | $1,880.72 |
| 10% | 3 years | $322.67 | $1,616.19 |
| 10% | 5 years | $212.47 | $2,748.23 |
| 13% | 3 years | $336.94 | $2,129.82 |
| 13% | 5 years | $227.53 | $3,651.84 |
Notice the trade-off: stretching a ₹5 lakh loan at 12% from 3 to 5 years cuts the EMI by about ₹5,485 a month but adds roughly ₹69,475 in interest.
Tips and common mistakes
- Use the yearly rate, not a monthly or flat rate. Some dealers quote a flat rate, where interest is charged on the full amount for the whole term. A flat rate of 7% costs far more than a 7% reducing-balance rate, so ask for the reducing-balance rate or APR before comparing.
- Add fees separately. Processing fees (often a percentage of the loan in India), origination fees in the US, GST on fees and loan insurance are not part of the EMI formula.
- Check affordability, not just approval. Many lenders look at how much of your monthly income goes to all EMIs combined. Leaving room in your budget matters more than the maximum a bank will lend.
- Prepay early if you can. Because interest is charged on the outstanding balance, an extra payment in year one saves more interest than the same payment in year four. Check for prepayment or foreclosure charges first.
- Compare the total interest, not just the EMI. A lower EMI over a longer tenure usually means paying more overall.
- Floating-rate loans change. If your rate is linked to a benchmark such as a repo-linked rate, your EMI or tenure can change when rates move. Re-run the numbers after each rate change.
More questions
How is personal loan EMI calculated?
Banks use the reducing-balance formula EMI = P × r ÷ (1 − (1 + r)−n), where P is the loan amount, r is the yearly rate divided by 12 and by 100, and n is the number of months. This loan calculator uses exactly that formula, so its answer should match a bank’s EMI to within a few rupees or cents of rounding.
What is the EMI for a ₹1 lakh loan?
At 12% a year, a ₹1,00,000 loan costs about ₹3,321 a month over 3 years or ₹2,224 a month over 5 years. For any other rate or tenure, enter the numbers above. EMIs scale in a straight line with the amount, so ₹2 lakh on the same terms costs twice as much each month.
Is it better to choose a shorter or longer loan tenure?
A shorter tenure means a higher monthly payment but much less total interest. A longer tenure lowers the EMI and eases monthly cash flow but costs more overall. Many borrowers pick the shortest tenure whose EMI still fits comfortably in their budget, then prepay when they can.
Does my credit score change the EMI?
Your credit score (such as a CIBIL score in India or a FICO score in the US) does not appear in the formula, but it often affects the interest rate a lender offers you. A lower rate means a lower EMI, so try the calculator with the different rates you are quoted.
Planning a bigger purchase? Use the mortgage calculator for home loans with tax and insurance, the compound interest calculator to see what the same monthly amount could grow to if saved instead, or the percentage calculator to work out processing fees quoted as a percentage.
Further reading: Amortization calculator (Wikipedia).