Car Loan EMI Calculator

EMI = [P x r x (1+r)^n] / [(1+r)^n - 1], where P is the principal, r the monthly interest rate and n the tenure in months. The instalment stays fixed while the split between interest and principal shifts over time.

No. A longer tenure lowers the monthly EMI but raises total interest substantially, because the outstanding principal is reduced more slowly. The amortisation table below shows exactly how much extra interest a longer term costs.

A prepayment reduces the outstanding principal directly, so every future interest calculation works on a smaller base. Prepaying early in the tenure saves far more than the same amount prepaid near the end.

Lenders typically finance 80-90% of the on-road price. A larger down payment reduces both interest and the risk of owing more than the car is worth, which matters because vehicles depreciate fastest in the first three years.

Not usually. Dealer arrangements can carry higher effective rates or bundled add-ons even when the headline rate looks attractive. Compare the total payable, including processing fees and insurance bundling, rather than the advertised rate.

Salaried individuals cannot. If the vehicle is used for business, the interest may be claimed as a business expense and depreciation may be available. Personal-use car loans carry no income tax deduction.