What Loan EMI (Equated Monthly Installment) Calculator ?

A Loan EMI (Equated Monthly Installment) Calculator helps users calculate the fixed monthly payment they need to make when repaying a loan. It considers the loan amount, interest rate, and loan tenure to determine the EMI.

How a Loan EMI Calculator is Work ?

1. User Inputs Data:

• Loan Amount (Principal) – The total loan taken.
• Interest Rate – The annual interest rate (%) set by the lender.
• Loan Tenure – The repayment period (in months or years).

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2. Formula Calculation:

• The EMI is calculated using the formula:
• EMI = \frac{P \times r \times (1 + r)^n}{(1 + r)^n - 1}
• EMI = Monthly Installment
• P = Loan Amount (Principal)
• r = Monthly Interest Rate (Annual Interest Rate ÷ 12 ÷ 100)
• n = Loan Tenure in months

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3. Result Display:

• The calculator shows the monthly EMI amount the borrower needs to pay.
• Some EMI calculators also show total interest payable and total payment (principal + interest).

How to Use Loan EMI Calculator ?

Using a Loan EMI Calculator is simple. Just follow these steps:
1. Enter the Loan Amount

• Type the total loan amount you plan to borrow. (Example: $10,000)

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2. Enter the Interest Rate

• Provide the annual interest rate (%) set by the bank or lender. (Example: 10%)

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3. Enter the Loan Tenure

• Choose the repayment period in years or months. (Example: 5 years)

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4. Click on ‘Calculate EMI’

• The calculator will instantly compute your monthly EMI using the standard loan formula.

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5. View the Results:

• Monthly EMI – The amount you need to pay every month.
• Total Interest Payable – The extra amount you pay as interest over the loan tenure.
• Total Payment – The total amount paid (Principal + Interest).

Example Calculation:

• Loan Amount = $10,000
• Annual Interest Rate = 10%
• Loan Tenure = 5 years (60 months)
• Monthly Interest Rate = 10% ÷ 12 = 0.0083 (or 0.83%)
• Using the formula, EMI = $212.47 per month

Benefits of a Loan EMI Calculator:

• Helps in financial planning before taking a loan.
• Gives clarity on the repayment amount.
• Helps compare different loan options.