Loan Repayment Calculator
Estimate your monthly loan repayment (EMI) based on the loan amount, interest rate, and loan term. Manage your finances and plan your loan repayment effectively.
Calculate Your Loan Repayment (EMI)
What is Loan Repayment (EMI)?
Loan repayment (EMI) is the monthly payment that you make to your lender to repay the loan amount over a specified period. The EMI includes both principal and interest components.
How is EMI for Loan Repayment Calculated?
The EMI for a loan repayment is calculated using the formula:
EMI = P × r × (1 + r)^n / ((1 + r)^n - 1)
Where:
- EMI: Monthly installment
- P: Principal loan amount
- r: Monthly interest rate (annual rate divided by 12)
- n: Number of payments (loan term in months)
Why is Loan Repayment Important?
- Financial Planning: Helps you plan your monthly finances by knowing the exact EMI.
- Prevents Late Fees: By knowing your EMI, you can ensure timely repayments and avoid penalties.
- Improves Credit Score: Timely repayment of loans can improve your credit score and future borrowing potential.
Example Calculation
Assume you have the following loan details:
- Loan Amount: ₹500,000
- Interest Rate: 10% annually
- Loan Term: 5 years
Using the formula, your monthly EMI would be approximately: ₹10,624.63