EMI Calculator

Equated Monthly Installment, commonly known as EMI, is an amount the borrower pays back every month on a particular date to the lender towards the repayment of loan taken by him. The EMI amount is calculated on the basis of the loan amount, interest rate and the tenure of loan. The borrowers' loan EMI comprises of the interest and the principal component. In the initial period of repayment the interest component in the EMI is significantly higher than the principal component. The components can be calculated using Apnapaisa Loan Amortization Calculator instead of the EMI Calculator.

One of the major factors that affect the loan eligibility of a prospective borrower is his ability to pay the EMI. Different banks presume certain portion of the borrowers' income as available for payment of EMI's of all loans. It varies from bank to bank and there is no standard norm or formula. But normally the bank will assume around 40%- 45% of the borrowers' net salary is available for payment of EMI to serve all the loans. Even the percentage which can be considered for servicing of any EMI can be higher for people in the higher income group. As the income rises the proportion of saving in monthly income goes up hence the higher proportion for servicing of any loan EMI.

The EMI calculator will help the borrower to find out his ability to service loan of a particular amount for certain tenure at a predetermined interest rate thus help in taking loan within his ability to service the EMI month after month. The EMI calculator will also give a break up of his EMI i.e. the principal component vis-a-vis the amount that you will be paying as an interest on that loan.