How to use the home loan EMI calculator
- Enter the loan amount, interest rate and tenure; the defaults are a typical home loan.
- Add your take-home income to check the EMI is affordable.
- Add prepayments, such as a yearly bonus, to see how much interest you save.
- Test a repo-rate rise to see the effect on your EMI or tenure.
- Add each bank's offer to the comparison table.
Home loan EMI at 8.5%
Home loan tax benefits
| Benefit | Old regime | New regime |
|---|---|---|
| Interest, self-occupied home | Up to ₹2 lakh a year | Not allowed |
| Principal repayment | Within ₹1.5 lakh 80C limit | Not allowed |
| Interest, let-out home | Against rental income | Against rental income |
Compare your tax under both regimes with the income tax calculator.
Tips to save on your home loan
- A larger down payment cuts both the EMI and total interest.
- Prepay in the early years, when most of each EMI is interest.
- Raise your EMI by 5% a year with your salary: it can cut years off the loan.
- Check your rate against new offers every year; a balance transfer can help if the gap is large.
Frequently asked questions
How is home loan EMI calculated?
Banks use the reducing-balance formula: EMI = P × r × (1 + r)^n ÷ ((1 + r)^n − 1), with r the monthly rate and n the number of months. For ₹50 lakh at 8.5% over 20 years, the EMI is about ₹43,391.
What tax benefits does a home loan give?
In the old tax regime you can deduct up to ₹2 lakh a year of interest on a self-occupied home, and principal repayments count towards the ₹1.5 lakh 80C limit. In the new regime there is no deduction for a self-occupied home, though interest on a let-out property can be set off against its rent.
How much home loan can I get on my salary?
Lenders usually keep all your EMIs within about 40–50% of take-home pay and lend up to 75–90% of the property value. Switch the calculator to EMI budget to see the largest loan your EMI can support.
Should I prepay my home loan or invest?
Prepaying saves interest at your loan rate risk-free, and there is no prepayment penalty on floating-rate home loans for individuals. Investing may earn more but carries risk. Use the prepayment planner above to see exactly what each prepayment saves.
What happens to my EMI when the repo rate changes?
Most home loans are linked to an external benchmark such as the RBI repo rate, so your rate changes at each reset. Banks often extend the tenure first; you can ask to raise the EMI instead. Test both with the rate change simulator.
Is a longer tenure better?
A longer tenure lowers the EMI but raises total interest sharply. On ₹50 lakh at 8.5%, 25 years costs about ₹70.8 lakh in interest versus ₹38.6 lakh over 15 years.