Car Loan EMI Calculator

If you were searching for ‘car loan calculator India’ to understand in detail how your EMI schedule will look, and how much EMI you will have to pay in India, read on.

We will use an EMI schedule table or an Amortization table that will illustrate how your EMIs need to be paid each month. The table will also show the EMI’s impact on your principal and interest amount. 

Even though your EMI remains the same throughout the repayment term, your principal and interest amount will reduce over time. This change is illustrated below -

If you are new to car loan EMI calculation, here’s an example to help you out -

Naren wants to buy a new car and uses a car loan to fund this process. His budget is Rs. 5,00,000 and after doing some preliminary research, he estimates that his annual interest rate would be around 9% per annum and he will have a repayment term of 3 years or 36 months.

After using moneyview’s Car Loan EMI calculator, he easily finds out that his monthly EMI would come up to Rs.15,900 with the interest component adding up to Rs. 72,395.

Naren’s Rs. 5 lakh car loan EMI amortization schedule or EMI schedule is as follows-

Just like Naren, you can also enter the details of your loan in our Car Loan Interest calculator to plan your spending so that your finances are not impacted negatively.

The type of interest calculation used for EMI can determine the amount that you pay. There are largely two ways of calculating this - flat balance and reducing balance method.

Here are some of the differences between the two -

The reducing balance interest method is generally used by banks to calculate the EMI and is the basis for the moneyview car loan EMI calculator as well.

Here’s a simple example to illustrate the differences between the two -

Rahul has taken a loan of Rs. 85,000. The interest rate imposed is 16% per annum with a repayment term of 8 months.

If he uses a flat balance method of interest calculation is used, his EMI will be - Rs. 11,758 and his EMI schedule will be -

But if the reducing balance method of calculation is used, his EMI will be - Rs. 11,272 and his EMI schedule will be -

As illustrated by the tables above, his EMI will be lower through the reducing balance method of calculation. The good news is that most lenders opt for this method of calculation.

It doesn't matter if you are looking to purchase a new car or a second hand vehicle, a low car loan EMI is every borrower’s dream. If you want to know what can reduce the EMI on your car loan interest calculator, read on.Here are a few factors that may impact your car loan EMI -

• Loan Amount

One of the major factors that determines your EMI is the amount you borrow. If the loan amount is high, your monthly installments too, will be high.

• Credit Score and Rate of Interest

Your credit score can help you to avail loans at lower rates of interest and at a repayment term that is affordable. What is considered a good credit score might vary from vendor to vendor.But moneyview provides loans even if you have a CIBIL score as low as 600. 

• Existing Debt

Existing debt might be an issue if you have too many loans running at the same time. Not only will it be hard for you to repay your EMI, lenders may also perceive you to be credit-hungry and refuse to lend to you.

• Repayment Tenure

The time taken to repay the loan amount is inversely proportional to the EMI amount i.e. a lengthy tenure implies that the EMI amount to be paid each month is lower and vice versa. 

But, taking a longer repayment period is not recommended as you will end up paying a higher interest amount overall.

• Type of Interest Rate

The type of interest rate chosen can have an impact on your EMI. Please note that this is not the same as interest rate calculation. 
A fixed interest rate will ensure the same interest rate throughout the repayment term. But if a floating interest rate is chosen then your interest rate may vary based on the RBI’s directives and can be lower or higher based on economic fluctuations.

• Age and Income

The older you are, the harder it is to avail a loan and this is especially the case if you are closer to retirement age. 
If your income is not steady or high then lenders will not provide loans easily. As long as your repayment ability is not assured, you will not be able to avail a loan quickly.
This is also the case with age. If you are closer to the retirement age (~60) and do not have regular income, loans won’t be available as easily.

Using a car loan interest rate calculator can be beneficial in many ways. Here are a few benefits-

• Finding out about your EMI in advance can help you plan your finances better
• Lower chances on making any manual error while using a car loan EMI calculator online
• Saves time and effort
• Can be accessed from anywhere and anytime