EMI Calculator
Calculate your Equated Monthly Installments (EMI) for home loans, car loans, and personal loans.
Calculator
How it Works: Formula & Examples
Equated Monthly Installment (EMI) is a fixed payment amount made by a borrower to a lender on a specified date each month. It repays both interest and principal over a set period.
The formula for EMI is:
EMI = P * r * (1 + r)$^n$ / ((1 + r)$^n$ - 1)
Where:
- P = Principal Loan Amount
- r = Monthly Interest Rate (Annual Rate / 12 / 100)
- n = Loan Tenure in Months
Example:
If you take a loan of $500,000 for 5 years at an annual interest rate of 10%:
- P = $500,000
- Annual Interest Rate = 10%
- Loan Tenure = 5 years = 60 months (n)
- Monthly Interest Rate (r) = $10 / (12 * 100) = 0.008333$
EMI = 500000 * 0.008333 * (1 + 0.008333)$^60$ / ((1 + 0.008333)$^60$ - 1) ≈ $10,623.50
Total Payment = EMI * Number of Months = $10,623.50 * 60 = $637,410.00
Total Interest = Total Payment - Principal Amount = $637,410.00 - $500,000 = $137,410.00
Frequently Asked Questions
What is EMI?
EMI stands for Equated Monthly Installment. It is a fixed payment amount that a borrower pays to a lender on a specific date each month.
How is the interest calculated?
The interest is calculated on the outstanding loan principal. In the initial months, a larger portion of the EMI goes towards interest, and gradually more goes towards the principal.
Can I repay my loan early?
This calculator does not account for early repayments or foreclosure charges. Please consult your lender for specific terms regarding early loan closure.