How this EMI calculator works
An EMI (equated monthly instalment) is the fixed amount you pay your lender every month until the loan is cleared. Each instalment has two parts: interest on the balance still owed, and a slice of the principal. Early on, most of the EMI is interest. As the balance falls, more of each payment goes to principal.
EMI = P × r × (1 + r)n ÷ ((1 + r)n − 1)Here P is the loan amount, r is the monthly interest rate (the yearly rate divided by 12 and by 100) and n is the number of monthly instalments. The calculator uses this reducing-balance method, which is how banks and housing finance companies in India calculate most loans.
Ways to lower what you pay
- Choose a shorter tenure. The EMI is higher, but the total interest drops sharply. Compare 15 and 20 years in the calculator to see the difference.
- Make part-prepayments. Extra payments reduce the principal, which cuts the interest on every later month. Ask your lender about prepayment charges first; floating-rate loans for individuals usually have none.
- Negotiate the rate. Even a 0.25% lower rate saves a meaningful amount on a large, long loan.
This tool covers the interest and principal only. Processing fees, insurance and other charges are extra, and floating rates can change during the loan, which changes your EMI.
Frequently asked questions
How is EMI calculated?
EMI = P x r x (1+r)^n / ((1+r)^n - 1), where P is the loan amount, r is the monthly interest rate and n is the number of months. The result is the fixed monthly payment that clears the loan exactly at the end of the tenure.
Does a longer tenure reduce my EMI?
Yes. A longer tenure lowers the monthly EMI but raises the total interest you pay over the life of the loan, so the loan costs more overall.
Is the interest rate fixed or floating in this calculator?
The calculator assumes one rate for the whole tenure. If your loan has a floating rate, your actual EMI or tenure will change when the rate changes.
Are processing fees and insurance included?
No. The result covers principal and interest only. Add lender charges, insurance and taxes separately.
Last reviewed October 15, 2026. Results are estimates.