Prepayment Calculator
Calculate the impact of prepaying your loan. Choose to reduce tenure or reduce EMI and see how much interest you can save.
Prepayment Mode
Prepayment amount cannot exceed the outstanding principal.
Interest Saved
₹31,885
Loan Comparison
| Without Prepayment | With Prepayment | |
|---|---|---|
| EMI | ₹10,145 | ₹10,145 |
| Total Interest | ₹86,961 | ₹55,076 |
| Total Payable | ₹4,86,961 | ₹4,55,076 |
| Tenure (months) | 48 | 35 |
How Does Prepayment Save Interest?
When you make a prepayment, the outstanding principal reduces immediately. Since interest is calculated on the outstanding balance, a lower principal means less interest accrues each month.
Reduce EMI: Keep tenure the same, lower monthly payment. Improves cash flow.
Frequently Asked Questions
Should I reduce tenure or EMI when prepaying? ▼
Reducing tenure saves more total interest and gets you debt-free faster. Reducing EMI improves monthly cash flow. If you can manage the current EMI comfortably, reducing tenure is almost always the better financial choice.
Is there a prepayment penalty on loans in India? ▼
RBI guidelines prohibit prepayment penalties on floating rate home loans. For fixed rate loans and personal loans, lenders may charge 1–4% of the prepaid amount. Always check your loan agreement before making a prepayment.
When is the best time to prepay a loan? ▼
The earlier in the loan tenure you prepay, the more interest you save. In the early years, a larger portion of your EMI goes towards interest. Prepaying in the first half of the tenure gives maximum benefit.