Car Loan EMI Calculator
Work out the exact monthly installment on a new or used car loan, plus total interest and a full amortization schedule. This calculator starts from typical car loan numbers, and includes a prepayment planner to see how an extra monthly payment shortens your payoff time.
Car Loan EMI Calculator
Enter your car loan amount, interest rate and tenure to see your monthly installment, principal-vs-interest breakdown, and a year-by-year amortization schedule — plus a prepayment planner that shows how much interest an extra payment saves.
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How Car Loan EMI Works
Car loan EMI follows the same reducing-balance formula as any other installment loan, but two things shape it in a car-loan-specific way: it's a secured loan (the car itself is the collateral, which is why rates sit below unsecured personal loans), and the asset depreciates the moment you drive it away — which is part of why lenders cap tenures lower than home loans and charge more for used cars than new ones.
Any down payment you make comes straight off the principal (P) before this formula even runs, which is why a larger down payment has an outsized effect on lowering your EMI — it shrinks the very number everything else in the formula is calculated on.
Worked Example
Loan amount (P): ₹800,000 (after down payment)
Annual interest rate: 9.5% → monthly rate r = 9.5 ÷ 12 ÷ 100 = 0.007917
Tenure: 60 months (5 years)
EMI = 800000 × 0.007917 × (1.007917)60 / ((1.007917)60 − 1) ≈ ₹16,800 per month
Over 5 years that's a total repayment of roughly ₹10,08,000 — about ₹2,08,000 of which is interest. Stretch the same loan to 7 years and the EMI drops, but the total interest paid climbs, since the loan accrues interest for two extra years — exactly the trade-off worth checking with the calculator above before picking a tenure.
New vs. Used Car Loans
Lenders generally price used-car loans higher than new-car loans, for two compounding reasons: a used car has already depreciated and continues to lose value faster in relative terms, and its resale value as collateral is less predictable if the loan needs to be recovered. Tenures for used-car loans also tend to be capped shorter — often 5 years instead of 7 — partly to keep the loan from outliving the car's useful resale value. If you're comparing a new versus used purchase, running both scenarios through the calculator above with their realistic rate and tenure differences gives a much clearer total-cost picture than comparing sticker prices alone.
Frequently Asked Questions
What interest rate applies to a car loan?
New car loans typically range from about 8% to 12% per year, while used-car loans usually run a bit higher, often 11% to 16%, since a depreciating asset with an already-lower resale value carries more risk for the lender.
What is a typical car loan tenure?
Car loans commonly run from 1 to 7 years (12 to 84 months). Longer tenures lower the monthly EMI but increase the total interest paid over the life of the loan, so it's worth checking both numbers before choosing a tenure.
Does a down payment reduce my car loan EMI?
Yes — a down payment reduces the principal you actually borrow, and since EMI is calculated directly on the principal, a larger down payment produces a proportionally smaller EMI (and less total interest) for the same rate and tenure.
Is it better to take a shorter or longer car loan tenure?
A shorter tenure means a higher EMI but noticeably less total interest paid, since the loan is repaid faster. A longer tenure lowers the monthly burden but the interest adds up over more months. The right choice depends on how much monthly EMI fits your budget versus how much total interest you're comfortable paying.