Loan Prepayment Calculator (Home, Personal & Car Loan)
This loan prepayment calculator shows what a part-payment does to your home loan, personal loan or car loan. Enter the outstanding balance, your EMI, the rate and the months left, then the lump sum, and compare reducing the tenure with reducing the EMI.
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Calculator and results
Prepaying ₹2,00,000 on a ₹20,00,000 loan at 9% saves ₹2,67,633 in interest if you keep the ₹25,000 EMI, closing the loan 1 year 7 months early; keeping the tenure instead lowers the EMI to ₹22,802.
Principal still owed today, from your latest statement.
A single lump sum paid today, applied fully to principal.
Interest saved
₹2,67,633
Keeping the same EMI
Months saved
1 year 7 months
New tenure
8 years 8 months
Original tenure
10 years 3 months
Two ways to use the prepayment
Keep the EMI, finish earlier
- EMI
- ₹25,000
- New tenure
- 8 years 8 months
- Interest paid
- ₹7,98,130
- Interest saved
- ₹2,67,633
Keep the tenure, lower the EMI
- New EMI
- ₹22,802
- Tenure
- 10 years
- Interest paid
- ₹9,36,170
- Interest saved
- ₹1,29,593
Without the prepayment, the loan would run 10 years 3 months and cost ₹10,65,764 in interest at this EMI and rate.
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- What it is:
- A calculator for what a lump-sum prepayment does to an existing loan.
- What it calculates:
- Revised tenure, interest saved, and the alternative of keeping the tenure and lowering the EMI.
Key Assumptions
- The prepayment is made today, in one go, and goes entirely to principal.
- The rate stays fixed for the remaining tenure.
- No prepayment or foreclosure charge is included.
How does the Loan Prepayment Calculator work?
The prepayment is applied to the outstanding principal today, in one go. The calculator then reruns your existing EMI against the reduced balance until the loan clears.
Reducing the tenure saves more interest than reducing the EMI, because the balance falls faster. The trade-off is that your monthly outgo stays the same.
Assumptions: the rate stays fixed for the rest of the loan, the full prepayment goes to principal, and no prepayment charge is applied. Floating-rate home loans to individuals generally have no prepayment penalty, but fixed-rate and business loans often do.
Worked example (home loan): ₹40,00,000 outstanding at 8.5% with 15 years left has an EMI of ₹39,390 and ₹30,90,049 of interest still to pay. A ₹5,00,000 prepayment, keeping the same EMI, ends the loan 39 months (over 3 years) early and saves ₹10,50,674 in interest. Keeping the tenure instead lowers the EMI to ₹34,466 and saves ₹3,86,211.
Reduce the tenure or the EMI? Reducing the tenure saves far more interest, almost three times as much in the example above, because the balance falls faster. Reduce the EMI only if the monthly payment is a strain. Most banks reduce the tenure by default, so tell them in writing which you want when you pay.
Prepayment charges: from 1 January 2026, RBI rules bar banks and NBFCs from charging any prepayment or foreclosure fee on floating-rate loans to individuals for non-business purposes, which covers most home loans. Fixed-rate personal and car loans may still carry a charge of 2% to 5%; subtract it from the interest saved. A personal loan of ₹5,00,000 at 13% with 36 months left saves ₹41,556 from a ₹1,00,000 prepayment, before any fee.
Before prepaying a home loan, weigh the tax benefit you give up on interest under the old regime (up to ₹2,00,000 a year on a self-occupied home) and keep an emergency fund. To compare prepaying with switching to a cheaper lender, see the Loan Balance Transfer Calculator; to see the full schedule, use the Home Loan EMI Calculator.
Prepayment on a ₹40 lakh home loan at 8.5%, 15 years left
| Prepayment | Reduce tenure: months saved | Reduce tenure: interest saved | Reduce EMI: new EMI | Reduce EMI: interest saved |
|---|---|---|---|---|
| ₹1,00,000 | 8 | ₹2,46,509 | ₹38,405 | ₹77,206 |
| ₹2,00,000 | 17 | ₹4,72,786 | ₹37,420 | ₹1,54,411 |
| ₹5,00,000 | 39 | ₹10,50,674 | ₹34,466 | ₹3,86,211 |
| ₹10,00,000 | 70 | ₹17,62,866 | ₹29,542 | ₹7,72,421 |
Current EMI ₹39,390. The prepayment is made now and goes fully to principal; the rate stays at 8.5%.
Loan Prepayment Calculator formula
New balance = outstanding - prepayment, then months to clear at the same EMI
- outstanding
- = principal still owed today
- prepayment
- = lump sum paid now, applied entirely to principal
- EMI
- = your current instalment, kept unchanged
Interest saved = interest without the prepayment minus interest after it.
Loan Prepayment Calculator: worked example
A ₹20,00,000 balance at 9%, EMI ₹25,000, with a ₹2,00,000 prepayment
- Tenure without prepaying
- 10 years 3 months
- Interest without prepaying
- ₹10,65,764
- Tenure after prepaying
- 8 years 8 months
- Interest after prepaying
- ₹7,98,130
- Interest saved
- ₹2,67,633
- Or: reduced EMI over the same tenure
- ₹22,802
Loan Prepayment Calculator: frequently asked questions
Should I reduce the tenure or the EMI?
Will my bank charge me for prepaying?
When is the best time to prepay?
Does the loan prepayment calculator include a prepayment penalty?
How much interest do I save by prepaying ₹5 lakh on a home loan?
Is it better to prepay a home loan or invest?
Further reading
EMI and total interest on a ₹5 lakh personal loan over 1 to 5 years, with the salary you need to qualify and what prepaying saves.
Calculate the exact monthly EMI and total interest on a ₹30 Lakh home loan at 8.5% interest across 10 to 30 years. Learn required salary and prepayment tips.
Calculate monthly EMI on a ₹50 Lakh home loan at 8.00% to 9.00%. See how a single extra prepayment annually saves over ₹15 Lakh in interest.
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Reviewed by Pradipta Ray, MBA (Finance) · Updated