Loan Prepayment Calculator

Pay extra towards a loan - once, every year or every month - and see the interest and months it saves, with the same EMI or a lower one.

About the Loan Prepayment Calculator

The Loan Prepayment Calculator shows what paying extra towards a loan saves. Put in your loan, then how much extra you will pay - one time, every year or every month - and when you start. It works out both choices your bank will offer: keep the same EMI and finish the loan early, or keep the end date and pay a lower EMI.

A prepayment goes straight to the principal, so every later EMI carries less interest. On a ₹30 lakh home loan at 8.5% for 20 years, ₹2 lakh prepaid after the first year saves about ₹6.9 lakh of interest and 34 months if you keep the EMI - and about ₹2 lakh if you lower the EMI instead.

How to use it

  1. 1Enter the loan amount, interest rate and tenure - the calculator shows your EMI.
  2. 2Choose how you will prepay: one time, every year or every month, and how much.
  3. 3Set after how many months of EMIs the first extra payment is made.
  4. 4Compare option A (same EMI, finish early) with option B (lower EMI, same end date), and see how fast the balance falls on the chart.

Frequently asked questions

Should I reduce the EMI or the tenure after a prepayment?

Reducing the tenure - keeping the EMI - saves much more interest. On a ₹30 lakh, 8.5%, 20-year loan, ₹2 lakh prepaid after a year saves about ₹6.9 lakh that way, against about ₹2 lakh by lowering the EMI. Lower the EMI only if you need the smaller monthly payment.

When is the best time to prepay a home loan?

As early as you can. Early EMIs are mostly interest, so a prepayment then removes more of it: the same ₹2 lakh saves about ₹6.9 lakh in year 1 but about ₹94,000 in year 15.

Is a small monthly prepayment worth it?

Yes. ₹2,000 extra every month on a ₹30 lakh, 8.5%, 20-year loan ends it 38 months early and saves about ₹6.1 lakh of interest.

Are there prepayment charges?

Under RBI rules, banks and NBFCs do not charge for prepaying floating-rate loans taken by individuals. Fixed-rate loans and some car or personal loans can carry a charge - check your loan agreement.

What happens if my prepayment is more than what I owe?

The loan simply closes - that is a foreclosure. The calculator shows it as cleared and counts only what you actually owed.

Does this include tax benefits on home loan interest?

No. If you claim home loan interest under the old tax regime, keeping the loan longer has a small tax benefit, which slightly lowers the real saving from prepaying.