What is an EMI?
An EMI (Equated Monthly Instalment) is the fixed amount you pay a lender every month until a loan is fully repaid. Each EMI has two parts — interest on the outstanding balance, and repayment of the principal. Early on, most of your EMI goes towards interest; over time, the principal share grows.
This EMI calculator works for home loans, car loans and personal loans. It shows your monthly EMI, the total interest you will pay, and a year-by-year amortization schedule — plus a prepayment planner that reveals how much interest and time you can save by paying a little extra.
The EMI formula
The calculator uses the standard reducing-balance EMI formula:
EMI = P × i × (1 + i)ⁿ ÷ [ (1 + i)ⁿ − 1 ]
- P = loan amount (principal)
- i = monthly interest rate = annual rate ÷ 12 ÷ 100
- n = tenure in months = years × 12
A worked example
Borrow ₹25,00,000 for 20 years at 9%. Your EMI works out to about ₹22,493 a month. Over the full tenure you would repay roughly ₹54 lakh in total — meaning close to ₹29 lakh is interest. That is why the loan tenure and interest rate matter so much.
The power of prepayment
Enter an extra monthly payment to see the impact. Because interest is charged on the outstanding balance, every extra rupee of principal you repay early removes all the future interest that rupee would have attracted. Even a small, consistent top-up can cut years off a home loan and save several lakh in interest.
Tip: whenever your salary rises, increasing your EMI (or adding a fixed extra amount) is one of the most effective ways to become debt-free faster.
Reduce tenure vs reduce EMI
When you prepay a loan, most lenders let you choose to reduce the tenure (keep the EMI the same and finish sooner) or reduce the EMI (keep the tenure and lower the monthly outgo). Reducing the tenure almost always saves more interest overall, but reducing the EMI eases monthly cash flow.