Question 1

How is home loan EMI calculated?

Accepted Answer

Home loan EMI uses the standard reducing-balance formula: EMI = P × r × (1+r)^n / ((1+r)^n − 1), where P is the loan amount, r is the monthly interest rate (annual rate ÷ 12 ÷ 100), and n is the tenure in months. Each EMI covers the interest on the outstanding balance plus a part of the principal, and the interest portion falls as the balance reduces.

Question 2

What is an amortization schedule?

Accepted Answer

An amortization schedule is a month-by-month table showing the opening balance, EMI, how much of each payment goes to principal and interest, and the closing balance after each payment. Early EMIs are interest-heavy; later EMIs are principal-heavy.

Question 3

What is Loan-to-Value (LTV)?

Accepted Answer

LTV is the loan amount as a percentage of the property value (loan ÷ (loan + down payment) × 100). As per RBI norms, lenders can finance up to 90% of the property value for loans up to ₹30 lakh, 80% for ₹30–75 lakh, and 75% above ₹75 lakh; the rest is your down payment.

Question 4

How does the processing fee work?

Accepted Answer

A processing fee is a one-time charge levied by the lender when the loan is sanctioned, usually 0.25% to 2% of the loan amount (sometimes capped). It is paid upfront and is not part of the EMI. This calculator adds it to the down payment to show your total initial cash outlay.

Question 5

Does a longer tenure reduce my EMI?

Accepted Answer

Yes. A longer tenure lowers the monthly EMI but increases the total interest paid over the life of the loan. A shorter tenure means a higher EMI but significantly lower total interest. The amortization schedule and interest-to-principal ratio help you compare both.

Question 6

Is my data sent to any server?

Accepted Answer

No. All calculations happen entirely in your browser using JavaScript. No data is sent to any server.

Home Loan Calculator

Frequently Asked Questions

Home Loan Calculator

Frequently Asked Questions