Compare loan options and see how prepayments reduce total cost.
This advanced loan calculator helps you understand the true cost of borrowing. Beyond basic EMI, it shows you the total interest burden and how prepayments can save you money.
Making extra payments towards your principal has a dramatic effect on total interest paid:
| Loan: ₹30L at 9% | Regular | +₹5K/mo Extra | +₹10K/mo Extra |
|---|---|---|---|
| Original Tenure | 20 Years | 20 Years | 20 Years |
| Actual Tenure | 20 Years | 13.5 Years | 10.5 Years |
| Total Interest Paid | ₹23.98L | ₹14.7L | ₹10.8L |
| Interest Saved | — | ₹9.28L | ₹13.18L |
| Years Saved | — | 6.5 Years | 9.5 Years |
| Factor | Fixed Rate | Floating Rate |
|---|---|---|
| Interest rate | Stays same throughout | Changes with market |
| EMI stability | Predictable | Can increase or decrease |
| Typical rate | Higher (1-2% premium) | Lower starting rate |
| Prepayment penalty | Usually 2-3% | None (RBI rule) |
| Better when rates are | Expected to rise | Expected to fall |
A shorter tenure means higher EMIs but significantly less total interest. A longer tenure lowers your monthly burden but costs more in total. Rule of thumb: choose the shortest tenure where EMI stays below 40% of your income.
Currently, competitive home loan rates in India range from 8.25% to 9.5%. If your rate is above 9%, consider balance transfer to a lower-rate lender.
You transfer your outstanding loan to a new bank offering a lower rate. The new bank pays off your old loan. Cost: 0.5-1% processing fee + ₹5-10K legal charges. Usually worth it if the rate difference is 0.5%+ and remaining tenure is 10+ years.
Yes. Under Section 24, you can deduct up to ₹2L/year on home loan interest. Under Section 80C, up to ₹1.5L on principal repayment. First-time buyers get additional ₹50K deduction under Section 80EEA.
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