1. What is EMI?

EMI (Equated Monthly Installment) is the fixed payment amount a borrower pays to a lender at a specified date each calendar month. It includes both principal and interest components.

2. How Does the Calculator Work?

The calculator uses the standard EMI formula:

Where:

• \( P \) — Principal loan amount (Rs)
• \( R \) — Monthly interest rate (annual rate divided by 12, in decimal)
• \( N \) — Loan tenure in months

Explanation: The formula calculates the fixed monthly payment that would pay off the loan with interest over the specified tenure.

3. Importance of EMI Calculation

Details: Knowing your EMI helps in financial planning, comparing loan offers, and determining affordability before taking a loan.

4. Using the Calculator

Tips: Enter principal amount in Rs, annual interest rate in percentage, and loan tenure in months. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: How does interest rate affect EMI?
A: Higher interest rates increase both your EMI and total interest paid. Even a small rate difference can significantly impact total repayment amount.

Q2: What happens if I increase the loan tenure?
A: Longer tenures reduce EMI but increase total interest paid. Shorter tenures mean higher EMIs but less total interest.

Q3: Are there other charges besides EMI?
A: Some loans may have processing fees, prepayment charges, or insurance costs that aren't included in EMI calculation.

Q4: Can I prepay my loan to reduce interest?
A: Many lenders allow partial or full prepayment which can reduce total interest, though some charge prepayment penalties.

Q5: How accurate is this calculator?
A: This provides standard EMI calculation. Actual loan terms may vary based on lender policies and additional charges.