How do Indian banks calculate Home Loan EMI?

Indian banks use the monthly reducing balance formula: EMI = [P x r x (1+r)^n] / [(1+r)^n - 1], where P is Principal, r is monthly interest rate, and n is total tenure in months.

Are there prepayment charges on floating rate home loans in India?

As per RBI guidelines, Indian banks and HFCs cannot levy any prepayment or foreclosure penalty on floating-rate home loans taken by individual borrowers.

Home, Car & Personal Loan EMI Calculator

Click an Indian bank preset or slide values to calculate monthly EMI and prepayment savings.

Loan Principal Amount (₹)

₹

Annual Interest Rate (% p.a.)

Loan Tenure (Years)

Yrs

Optional Annual Prepayment (₹ / Year)

₹

Monthly Loan EMI

₹30,374

₹72.90 Lakh Total Payable

Principal Loan Amount ₹35,00,000

Total Interest Payable ₹37,89,715

Interest Saved via Prepayment ₹0

Total Payment (Principal + Interest) ₹72,89,715

Principal Amount

Total Interest Outgo

Year-by-Year Loan Amortization Schedule

Annual breakdown of principal repaid, interest charged, and closing loan balance.

Year	Principal Repaid	Interest Paid	Closing Balance

How Loan EMI & Prepayment Works in Indian Banks

Whether you take a plot/construction loan or a ready-possession home loan from SBI, HDFC, ICICI, Bank of Baroda, or PNB, interest is compounded monthly on a reducing balance basis.

EMI = [P × r × (1 + r)^n] / [(1 + r)^n − 1]

Smart Tip: Offset Your Home Loan Interest with a Nifty 50 SIP

Many Indian borrowers pair their 20-year home loan with a parallel monthly equity index SIP (10%–15% of the EMI amount) using our Mutual Fund SIP Calculator or build a guaranteed tax-free reserve in the PPF Calculator.

Explore All Interlinked HISSABBHARAT Financial Calculators

Every tool is directly linked for seamless cross-comparison between bank loans, mutual fund SIPs, and government schemes.

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