Car Loan EMI Calculator
Calculate your monthly installment, total interest outflow, and repayment amortization across 1 to 7-year tenures for new and used cars in India.
Loan Details
Adjust amount, interest rate and tenure to recalculate your monthly EMI instantly.
Add an extra monthly prepayment to see how much interest and tenure you save.
In the early years of a long-term loan (like Home Loans), up to 70% of each EMI goes towards paying interest rather than the principal. Prepaying even small lump-sums during the first 5 years drastically reduces your overall interest burden.
Year-by-Year Loan Amortization Schedule
Detailed annual breakdown of principal repayment, interest outflow, and declining loan balance.
| Year | Opening Balance | EMI Paid | Principal Paid | Interest Paid | Ending Balance | Loan Paid % |
|---|---|---|---|---|---|---|
| Year 1 | ₹8,00,000 | ₹1,99,284 | ₹1,32,668 | ₹66,616 | ₹6,67,332 | 17% |
| Year 2 | ₹6,67,332 | ₹1,99,284 | ₹1,45,113 | ₹54,171 | ₹5,22,219 | 35% |
| Year 3 | ₹5,22,219 | ₹1,99,284 | ₹1,58,726 | ₹40,558 | ₹3,63,493 | 55% |
| Year 4 | ₹3,63,493 | ₹1,99,284 | ₹1,73,615 | ₹25,669 | ₹1,89,878 | 76% |
| Year 5 | ₹1,89,878 | ₹1,99,260 | ₹1,89,878 | ₹9,382 | ₹0 | 100% |
How to Finance a Vehicle: The 20/4/10 Rule for Car Buyers
Cars are depreciating assets—the minute you drive a brand-new vehicle out of the dealership, its market value drops by 10% to 15%. To avoid being "underwater" on your car loan (owing more money to the bank than the car is worth), financial planners recommend the 20/4/10 rule:
- 20% Down Payment: Put down at least 20% in cash from your own savings.
- 4 Years Maximum Tenure: Limit the loan tenure to 48 months (4 years) instead of stretching to 7 years.
- 10% Monthly Income Limit: Total monthly vehicle expenses (EMI + fuel + insurance) should not exceed 10% of your gross monthly income.
Frequently Asked Questions on Car Loan EMIs
How is Car Loan EMI calculated?
Car Loan EMI is calculated based on reducing balance interest: EMI = [P x r x (1 + r)^n] / [(1 + r)^n - 1], where P is the on-road loan amount after down payment, r is periodic monthly rate, and n is tenure in months (typically 36 to 84 months).
What is the standard down payment for a car loan in India?
Most Indian banks finance between 80% and 90% of the ex-showroom or on-road car price, meaning you need to provide a minimum 10% to 20% down payment upfront.
Are car loans fixed or floating interest rate loans?
Unlike home loans which are almost universally floating, most car loans in India are sanctioned at a fixed interest rate. This means your monthly EMI remains constant regardless of future RBI repo rate fluctuations.
Can I prepay or foreclose my car loan before tenure ends?
Yes, but because most car loans are fixed-rate debts, banks typically levy a prepayment or foreclosure fee of 2% to 6% of the outstanding principal balance if closed before maturity.