EMI Caluclator for Home / housing Loan

Calculate Monthly EMI for Housing / Home Loan with Interest and Principal Amount

Are you confused with the housing loan interest calculation? No worries! We provide an easy and simple EMI calculator for housing loans/home loans. To determine the monthly EMI and cumulative interest and principal, we offer detailed information and a month-wise chart. To get the EMI information, you need to know the following:

• Housing loan tenure / Number of Years
• Fixed / Current Interest Rate
• Total Loan Amount / Lending Amount

By entering the above details, you can obtain the monthly EMI, total amount with interest, total interest amount alone, and interest amount on a yearly basis. Additionally, you can access a detailed chart/table listing the monthly EMI, contribution towards principal, contribution towards interest, and loan balance at the end of each month. This EMI home loan chart is applicable for states including Telangana, Assam, Jharkhand, Chhattisgarh, Andhra Pradesh, Maharashtra, Mizoram, Sikkim, Bihar, Meghalaya, Karnataka, Tamil Nadu, Kerala, Punjab, Delhi, Haryana, Tripura, Arunachal Pradesh, Jammu and Kashmir, Uttarakhand, Madhya Pradesh, Rajasthan, Odisha, Goa, Nagaland, Manipur, West Bengal, Gujarat, Uttar Pradesh, Himachal Pradesh, and Puducherry.

The major housing/home loan providers in India are:

• Housing Development Finance Corporation Limited (HDFC)
• State Bank of India Home Finance (SBI)
• Housing and Urban Development Corporation (HUDCO)
• LIC Housing Finance Limited
• ICICI Home Finance Company Limited
• Axis Bank
• IDBI Home Finance Limited (IHFL)
• PNB Housing Finance Limited
• Dewan Housing Finance Corporation Limited (DHFL)
• Bank of India

How EMI Amount is Calculated for Home Loan

The EMI (Equated Monthly Installment) amount for a home loan is calculated using the principal loan amount, the interest rate, and the loan tenure. The formula for calculating EMI is based on the concept of amortization, where the loan is repaid in fixed monthly installments over a specified period.

Formula for Calculating EMI

The formula used to calculate EMI is:

EMI = P × r × (1 + r)^n / [(1 + r)^n - 1]

Where:

• P = Principal loan amount
• r = Monthly interest rate (annual interest rate divided by 12 and converted into a decimal)
• n = Number of monthly installments (loan tenure in months)

Steps to Calculate EMI

1. Convert Annual Interest Rate to Monthly Rate: Divide the annual interest rate by 12 to get the monthly interest rate. Then, convert it into a decimal by dividing by 100.

   Monthly Interest Rate (r) = Annual Interest Rate / (12 × 100)

2. Calculate the Number of Installments: Multiply the number of years of the loan tenure by 12 to get the total number of monthly installments.

   Number of Installments (n) = Loan Tenure in Years × 12

3. Apply the EMI Formula: Substitute the values of P, r, and n into the EMI formula to get the monthly installment amount.

Example Calculation

Suppose you take a home loan of ₹10,00,000 (₹10 lakh) at an annual interest rate of 8% for a tenure of 20 years.

1. Convert Annual Interest Rate to Monthly Rate:

   r = 8 / (12 × 100) = 0.00667

2. Calculate Number of Installments:

   n = 20 × 12 = 240

3. Apply the EMI Formula:

           EMI = 10,00,000 × 0.00667 × (1 + 0.00667)^240 / [(1 + 0.00667)^240 - 1]
           EMI ≈ 6,667 × 5.0565 / 4.0565 ≈ 8,187
           

   The EMI amount would be approximately ₹8,187.

Additional Considerations

• Amortization: Initially, a larger portion of the EMI goes towards paying the interest, while the principal repayment increases over time.
• Prepayment: Prepaying part of the loan can reduce the EMI or shorten the loan tenure.
• Change in Rates: For loans with floating interest rates, EMI amounts may change with fluctuations in the interest rate.

EMI Calculation Tools

Many online calculators can automate this process. You just need to input the principal amount, interest rate, and tenure to get the EMI amount instantly.