1. What is the EMI Calculation?

The EMI (Equated Monthly Installment) calculation determines the fixed monthly payment amount a borrower makes to a lender to repay a loan over a specified period. It includes both principal and interest components.

2. How Does the Calculator Work?

The calculator uses the EMI formula:

Where:

• \( P \) — Principal loan amount (₹ or currency)
• \( r \) — Monthly interest rate (decimal)
• \( n \) — Loan term in months

Explanation: The formula calculates the fixed monthly payment required to pay off a loan over a specified period, accounting for both principal and interest.

3. Importance of EMI Comparison

Details: Comparing EMIs for different interest rates helps borrowers understand how rate changes affect their monthly payments and total loan cost, enabling better financial decision-making.

4. Using the Calculator

Tips: Enter the principal loan amount, annual interest rate percentage, and loan term in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: How does interest rate affect EMI?
A: Higher interest rates result in higher EMIs, as more money goes toward interest rather than principal repayment.

Q2: What is the relationship between loan term and EMI?
A: Longer loan terms result in lower EMIs but higher total interest paid over the life of the loan.

Q3: Can I change the currency symbol?
A: The calculator uses ₹ by default but works with any currency as the calculation is the same regardless of currency type.

Q4: Does this include additional fees or insurance?
A: No, this calculates only the principal and interest components. Additional fees, insurance, or taxes would increase the total monthly payment.

Q5: How accurate is this calculator for variable rate loans?
A: This calculator is designed for fixed-rate loans. For variable rate loans, the EMI would change when interest rates adjust.