Home Loan EMI Calculator: A complete guide

The home loan EMI calculator works on some basic arithmetic formulae and includes two calculators, namely the home loan EMI calculator and the home loan interest calculator. The home loan EMI calculator performs a lengthy and complex calculation in order to calculate the home loan EMI. Therefore, it is a good idea to use a home loan EMI calculator available online to calculate the EMI for your loan. The second calculator that is the home loan interest rate calculator is used to calculate the monthly interest on the home loan. This works on a simple formula in comparison to the first one.

How does the EMI calculator work?

The EMI calculator for home loans works on the following inputs:

  • Loan Amount: The home loan amount is the sum of money you have borrowed for purchasing a house. The amount that you can borrow depends not only on the cost of the property but also on the repayment capacity of the borrower. You can get a loan as high as 80% of the entire price of the property. This is called the principal amount of the loan. The rate of interest is applied to this Principal amount. The final amount is then divided equally as per the tenure of the loan that has been taken. 
  • Interest Rate: This is the rate at which interest is levied on the amount that is borrowed. These Home loan rates vary widely from one financial institution to another; hence, it is best to check the interest rates before applying for the home loan. Interest rate can be either floating or fixed. When it is fixed, the interest rate remains the same for the entire loan tenure and therefore all loan EMIs are equal. However, if it is a floating interest rate, the rates will fluctuate with any change in the base rate and hence the EMIs vary through the tenure. 
  • Tenure:It is the time allotted to you or chosen by you for repayment of the loan. A majority of the home loans come with flexible loan tenures. Home loans are long-term loans, hence repayment tenures can be as long up to 20 years, in some special cases up to even 30 years! You get to choose a loan tenure as per your wish, but keep in mind the longer tenure you will choose the more interest you will pay

The Formula to Calculate Home 0Loan EMI

You should keep in mind that all the info, i.e. the loan tenure and the interest rate you enter into the EMI calculator should be in terms of months.

To calculate your home loan EMI you can also use the following formula:


Please note that the formula above doesn’t include the home loan processing fee charged by the financial institution. In this formula, the abbreviations used are explained as follows:

EMI stands for Equated Monthly Instalment.

  • P stands for Principal, which is the amount that is borrowed as a loan
  • R stands for Rate of Interest that is levied on the home loan amount. Please notice that interest rate should be input as a monthly rate.
  • N is the tenure of repayment of the loan or the number of monthly instalments that you will pay (tenure should be in months)

Using a home loan calculator you can calculate the EMI within milli-seconds and save yourself from the tedious calculations.


  1. How much loan am I eligible for? 
    You can get a loan as high as 80% of the entire value of the property. The tenure & interest rate chosen will also determine the loan amount. You can also use a Home Loan Eligibility Calculator app available online. 
  1. What are the options for the rate of interest?
    Home loan rates can be either flexible or fixed. In the former, the rate does not remain fixed while the interest rate is fixed for the loan’s entire tenure in the latter. 
  1. What are the other costs involved in taking a home loan?
    While applying for a home loan, it is crucial to check all the other charges like MODT charges, processing fee, loan conversion charge, legal verification charge, etc 
  1. Can you pre-close your loan ahead of schedule?
    You can pre-close the loan ahead of its original tenure. For a floating interest rate, no charge will be applicable but there may a charge applicable on a fixed rate. 
  1. Can I use the Home Loan EMI Calculator to find the best bank to get a loan from?

Home Loan EMI Calculator is very useful and easy to compare the EMIs of various banks. This helps you make a smart decision about which bank to go for! 

  1. Home Loan Calculator or Excel Calculator?

Home Loan calculator is tailored as it solely caters to the need of calculating EMIs, so why to take so much tedious work. 

  1. Will the Home Loan EMI calculated by the bank differ from the one calculated by the EMI Calculator?

No! It will be exactly the same, provided you enter the same value everywhere. 

  1. Will the Home Loan EMI Calculator compute how much EMI is payable after a certain amount of principal is paid as a chunk during the loan tenure?

Yes. With the right details, the Home Loan EMI Calculator will assist in calculating the EMI for the balance outstanding period. 

  1. What are the factors influencing Home Loan Interest Rates?
  • Inflation Trends & Conditions
  • Policy Changes by the Reserve Bank of India
  • Macroeconomic conditions in the country
  1. Should one take insurance to cover home loan liability?
    It is better to cover your home loan liability by not letting it fall on your family in your absence but it’s not compulsory to buy such insurance from the lender.