Loan Repayment Calculator: Plan Your EMIs

A loan repayment calculator is an online tool that estimates your monthly EMI and repayment schedule using the principal, interest rate and loan tenure. It can help you understand how much you may repay over the selected period before making financial decisions.

The standard EMI calculation uses the following formula:

EMI = [P × R × (1 + R)^N] / [(1 + R)^N - 1]

Where:

• P = Principal loan amount
• R = Monthly interest rate, calculated from the applicable annual rate
• N = Loan tenure in months

For example, a borrower can enter the proposed loan amount, applicable interest rate and repayment period to estimate the monthly EMI. The calculator can then show the estimated total interest and total repayment amount.

The calculation is useful for comparing different repayment scenarios. However, the result should not be treated as the final amount payable under a loan agreement.

What is a loan repayment schedule?

A loan repayment schedule gives borrowers a clear view of their upcoming EMIs and how each payment contributes towards clearing the loan. Reviewing the schedule regularly makes it easier to plan repayments and track loan progress.

Key details generally included in a loan repayment schedule are:

• EMI due date: The date on which each scheduled instalment is payable.
• EMI amount: The instalment amount due for each repayment cycle.
• Principal component: The portion of the EMI used to reduce the outstanding principal.
• Interest component: The portion allocated towards the interest payable under the loan terms.
• Outstanding balance: The principal amount remaining after scheduled repayments.

Tracking these details helps borrowers stay aware of their repayment obligations and identify upcoming dues. Making scheduled payments on time also helps avoid overdue amounts and applicable charges.

A loan repayment calculator can help you assess whether a proposed EMI fits within your planned monthly budget.

You can use the calculator to:

• Estimate your monthly EMI before taking a loan.
• Compare different loan tenures.
• Understand the estimated split between principal and interest.
• Estimate the total interest payable over the selected tenure.
• Assess how an additional payment could affect the remaining repayment.
• Review an estimated repayment schedule for future planning.

A longer tenure may reduce the monthly EMI but can increase the total interest payable over the repayment period. A shorter tenure may increase the EMI while reducing the period over which interest is charged. The right tenure therefore depends on both the estimated total cost and your ability to meet the EMI regularly.

How can you estimate your loan repayment and interest payable?

You can use a loan repayment calculator to estimate your EMI, total interest payable and overall repayment amount based on the loan amount, interest rate and repayment tenure. The calculation helps you understand your scheduled repayment obligations before and during the loan tenure.

You can use a calculator to review two aspects:

Scenario 1: Scheduled EMI repayment
Enter the loan amount, applicable interest rate and repayment tenure to estimate the EMI, total interest payable and overall repayment amount.

Scenario 2: Review the repayment schedule
Use the calculated figures to understand how your regular EMIs contribute towards the principal and interest over the repayment period. For an existing loan, refer to the applicable repayment schedule and loan account details for the actual amounts due.

The calculated figures are estimates and may differ from the actual repayment amount based on the loan terms, payment dates, outstanding balance and applicable charges. If an EMI is overdue, check the amount payable in your loan account before making the repayment.

How to use a loan repayment calculator?

Use a loan repayment calculator by entering the key loan details and comparing the resulting repayment estimates.

Follow these steps:

1. Open the loan repayment calculator.
2. Enter the loan amount you intend to borrow or the relevant outstanding amount.
3. Enter the applicable interest rate.
4. Enter the loan tenure in months or years, depending on the calculator.
5. Select the option to calculate the EMI.
6. Review the estimated EMI, total interest and total repayment amount.
7. Where available, enter an additional payment amount to compare the estimated impact on repayment.
8. Review or download the repayment schedule, where the calculator provides this option.

For an existing Bajaj Finance loan, you can also use the Bajaj Finance App or My Account portal to access relevant loan information, such as loan statements and repayment details. Use your actual loan account information when checking your current dues, rather than relying only on a calculator estimate.

How does an additional payment affect loan repayment?

An additional payment towards a loan can reduce the outstanding principal, which may reduce future interest payable depending on the loan terms and how the payment is applied. A calculator with an additional-payment feature can help compare estimated repayment outcomes before and after making an extra payment. The result may show potential changes in the remaining repayment period or overall interest cost. The actual benefit depends on the timing and amount of the payment, the applicable interest calculation method, the lender’s terms and any applicable charges. An additional payment does not necessarily reduce the EMI. Depending on the loan terms and repayment arrangement, the benefit may instead be reflected through a shorter tenure or another permitted adjustment. Borrowers should review the applicable loan terms to understand how an additional payment will affect the remaining repayment schedule and total repayment.