Car Loan EMI Calculator

A car loan EMI is the fixed monthly instalment that repays your vehicle loan, part interest on the outstanding balance and part principal. This calculator starts from the on-road price rather than the loan amount — set your down payment percentage and it derives how much you actually need to borrow before showing the EMI.

That distinction matters because Indian lenders quote loan-to-value on the ex-showroom price, while you pay the on-road price, which includes road tax, registration and insurance. Moving the down payment slider shows instantly how much every extra rupee of your own money trims from the EMI and from the interest you hand the bank over the tenure.

How the car loan EMI is calculated

First the loan amount: loan = on-road price − down payment. Then the reducing-balance EMI formula every Indian bank and NBFC uses: EMI = P × r × (1 + r)ⁿ ÷ ((1 + r)ⁿ − 1), where P is the loan amount, r the monthly rate (annual ÷ 12 ÷ 100) and n the tenure in months.

For a ₹12,00,000 on-road price with a 20% down payment of ₹2,40,000, the loan is ₹9,60,000. At 9.5% for 5 years, r = 0.0079167 and n = 60, giving an EMI of ₹20,162. Across the tenure you repay ₹12,09,707, of which ₹2,49,707 is interest — roughly the same as your down payment, which is why stretching the tenure to lower the EMI is rarely a bargain.

How to use this calculator

• Set the on-road price — ex-showroom plus road tax, registration, insurance and any accessories you are financing.
• Move the down payment slider; 20% is typical, and a larger margin usually unlocks a better rate.
• Enter the interest rate the dealer or bank quoted — new-car rates today sit around 8.5–11%, used-car rates higher.
• Choose the tenure. Anything beyond 5 years usually costs more in interest than the car depreciates in value.
• Open the amortization schedule to see the outstanding balance year by year, which tells you when foreclosing becomes worthwhile.

Car loan rates and costs in India

Banks typically fund 80–90% of the ex-showroom price for new cars, so expect to bring 15–25% of the on-road price yourself once road tax, registration and insurance are counted. On top of the interest, budget a processing fee of ₹3,000–₹10,000 (or 0.5–1% of the loan), plus documentation and hypothecation charges. Used-car loans are funded at a lower percentage of valuation and carry rates 3–5% higher than new-car loans.

A car is a depreciating asset, so the shortest tenure your budget allows is almost always the right answer — a 7-year loan can leave you owing more than the car is worth for much of the term. Most lenders allow foreclosure after 6–12 EMIs with a charge of 3–6% of the outstanding principal, though this is waived on floating-rate loans. Salaried buyers get no tax deduction on a personal car loan; if the vehicle is used for business or profession, the interest and depreciation can be claimed as a business expense instead.

Frequently asked questions