Worked example
Borrow ₹25,00,000 at 8.5% a year for 20 years and the EMI is ₹21,696. You pay ₹27,06,939 as interest, so you repay ₹52,06,939 in all.
- Loan amount
- ₹25,00,000
- Interest rate (per year)
- 8.5%
- Loan tenure
- 20 years
- EMI
- ₹21,696
- Total interest
- ₹27,06,939
- Total payment
- ₹52,06,939
| Year | Paid in the year | Interest | Principal | Balance at year end |
|---|---|---|---|---|
| 1 | ₹2,60,347 | ₹2,10,591 | ₹49,756 | ₹24,50,244 |
| 2 | ₹2,60,347 | ₹2,06,193 | ₹54,154 | ₹23,96,091 |
| 3 | ₹2,60,347 | ₹2,01,407 | ₹58,940 | ₹23,37,150 |
| 4 | ₹2,60,347 | ₹1,96,197 | ₹64,150 | ₹22,73,000 |
| 5 | ₹2,60,347 | ₹1,90,527 | ₹69,820 | ₹22,03,180 |
| 10 | ₹2,60,347 | ₹1,53,710 | ₹1,06,637 | ₹17,49,846 |
| 15 | ₹2,60,347 | ₹97,480 | ₹1,62,866 | ₹10,57,468 |
| 20 | ₹2,60,347 | ₹11,601 | ₹2,48,746 | ₹0 |
Looking for a common amount? See the home loan EMI examples, with the EMI, interest and yearly schedule for each.
How to use this calculator
- Enter the loan amount — type it or drag the slider.
- Enter the yearly interest rate from your loan offer.
- Choose the tenure in years or months.
- Read your monthly EMI, total interest and total payable.
- Pick a chart view, open any year in the schedule to see its months, or download it as CSV.
How EMI is calculated
Banks use the standard reducing-balance formula. Interest is charged each month on the loan amount still left.
EMI = P × r × (1 + r)n ÷ ((1 + r)n − 1)
Here P is the loan amount, r is the monthly interest rate (yearly rate ÷ 12 ÷ 100) and n is the number of monthly instalments.
Example: a loan of ₹25,00,000 at 8.5% a year for 20 years (240months) has an EMI of ₹21,696. Over the full tenure you pay ₹52,06,939, of which ₹27,06,939 is interest.
Frequently asked questions
What is an EMI?
An EMI (equated monthly instalment) is the fixed amount you pay your lender every month until the loan is repaid. Each EMI covers that month's interest and repays part of the loan amount (principal).
Why does most of my early EMI go towards interest?
Interest is charged on the loan amount still left. At the start the most is left, so interest takes the biggest share. For a ₹25 lakh loan at 8.5% for 20 years, about 81% of the first year's EMIs goes to interest. As the balance falls, more of each EMI repays principal.
Is it better to choose a shorter tenure?
A shorter tenure means a higher EMI but much less interest overall. Taking the same ₹25 lakh loan at 8.5% over 15 years instead of 20 raises the EMI from ₹21,696 to ₹24,618, but cuts total interest from ₹27,06,939 to ₹19,31,328.
How much does a lower interest rate save?
Even half a percentage point matters on a long loan. At 8% instead of 8.5%, the EMI on ₹25 lakh over 20 years drops by ₹785 a month, and total interest falls by ₹1,88,299.
What happens to my EMI if I have a floating-rate loan?
When the rate on a floating-rate loan changes, the lender either changes your EMI or keeps the EMI the same and changes the remaining tenure. This calculator assumes the rate stays the same for the whole loan.
Does the EMI include processing fees or insurance?
No. The EMI shown covers only principal and interest. Processing fees, insurance premiums and other charges are extra — check them in your loan offer.