Plan your Home, Car, or Personal loan. See exactly how much interest you will pay to the bank.
Paying even a little extra directly reduces your principal, slashing total interest.
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Your Equated Monthly Installment (EMI) consists of a principal component and an interest component. In the early years of a home loan, a large portion of your EMI goes towards interest.
Indian banks allow you to make part-payments towards your home loan. Even small extra payments can reduce your tenure significantly because they get adjusted directly against the principal outstanding.
Did you know? RBI mandates no foreclosure charges on floating rate home loans for individuals. You can pay off your loan early without penalties!
EMI (Equated Monthly Installment) is a fixed monthly payment comprising principal and interest. It's calculated using the formula: P × r × (1+r)^n / ((1+r)^n - 1), where P is principal, r is monthly interest rate, and n is tenure in months.
Prepayment is beneficial if your loan interest rate exceeds your investment returns. For home loans below 7-8%, investing surplus funds in equity may yield better long-term returns.
Longer tenure means lower EMI but higher total interest paid. For example, a ₹50L loan at 8% for 20 years costs ₹41.9L in interest, while the same loan for 10 years costs ₹21.8L in interest.
Fixed rates remain constant throughout the loan tenure, providing payment certainty. Floating rates change with market conditions (MCLR/repo rate), potentially saving money when rates fall but increasing costs when rates rise.