How to Calculate Home Loan or Personal Loan EMI

What does EMI mean?

An equated monthly instalment (EMI) is the regular payment made towards a loan. For a standard reducing-balance loan, each payment includes interest on the outstanding principal and a principal repayment. The interest portion generally falls over time while the principal portion rises.

The EMI formula

For principal P, monthly interest rate r and number of monthly payments n, EMI = P × r × (1+r)^n ÷ ((1+r)^n − 1). Convert an annual percentage rate to a monthly decimal by dividing by 12 and then by 100. This formula assumes a constant rate and regular monthly periods.

How to estimate your EMI

Use the calculator to model the loan before accepting an offer.

1. Enter the amount you plan to borrow, not the total property or purchase price.
2. Enter the annual interest rate quoted by the lender.
3. Enter the repayment tenure in months or years as requested.
4. Review the monthly EMI, total repayment and total interest.
5. Repeat with a different rate or tenure to compare scenarios.

Worked example

For a hypothetical ₹10,00,000 loan at 10% annual interest over 5 years, the monthly rate is 0.10 ÷ 12 and there are 60 payments. The estimated EMI is about ₹21,247; total payments are about ₹12.75 lakh and interest is about ₹2.75 lakh. Actual lender schedules can differ because of fees, dates and rounding.

What this estimate does not include

Processing fees, insurance, taxes, floating-rate resets, prepayments, broken-period interest and lender-specific rounding can change the actual repayment schedule. Use the sanction letter and amortisation schedule as the authoritative figures.