Home Loan Calculator







Concept:
A Home Loan Calculator helps estimate your monthly EMI, the total repayment amount,
and the interest burden over the loan period. It is based on the standard amortization
formula used by banks.

Formula for EMI
EMI = (P * r * (1 + r)^n) / ((1 + r)^n – 1)

Where:

  • P = Loan amount (principal)
  • r = Monthly interest rate = (Annual Interest Rate ÷ 12 ÷ 100)
  • n = Loan tenure in months
Other Formulas
    1. Total Repayment:
Total_Repayment = EMI *
    2. Total Interest Outgo:
    Total_Interest = Total_Repayment – P

Step-by-Step Manual Formulas

Step 1. Convert annual interest to monthly rate:

r = Annual_Interest_Rate / (12 * 100)

Step 2. Calculate compound factor:

Factor = (1 + r)^n

Step 3. Compute EMI:

EMI = (P * r * Factor) / (Factor – 1)

Step 4. Compute total repayment:

Total_Repayment = EMI * n

Step 5. Compute total interest:

Total_Interest = Total_Repayment – P

Theory in Simple Words

  • EMI (Equated Monthly Instalment) ensures fixed monthly payments over the tenure.
  • The amortization formula balances principal + interest so each EMI is equal.
  • Over time, the interest portion decreases while the principal portion increases.
  • Knowing EMI, total repayment, and total interest helps in loan planning and
    comparing lenders.