EMI (Equated Monthly Instalment) is the fixed monthly payment you make to repay a loan. It includes both principal and interest components.
EMI = [P × R × (1+R)^N] / [(1+R)^N - 1], where P is the principal, R is the monthly interest rate, and N is the number of months.
Yes. A larger down payment reduces the loan principal, which directly reduces the EMI amount.
Total interest = (EMI × number of months) - principal. Our calculator shows the total interest paid alongside the monthly EMI.
A longer tenure reduces the monthly EMI but increases the total interest paid. A shorter tenure means higher EMI but less total interest.
A prepayment is an extra payment made towards the principal. It reduces the outstanding balance, which lowers future interest and can shorten the loan tenure.
Flat rate interest is calculated on the original principal throughout the loan. Reducing balance interest is calculated on the outstanding principal, which decreases with each payment. Reducing balance results in lower total interest.