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How Do I Calculate The EMI For Home Loan?

Home loans are secured loans with longer repayment tenures. A home loan might last for two decades or more. The debtor pays a fixed amount to the loan provider every month until the loan is dissolved. In this article, we have explained the process of calculating the home loan EMI.

Besides the principal component of the home loan, the debtor also pays interest charges. A fixed part of the debtor’s income will go towards monthly EMIs.

Since a fixed part of the income will go towards loan repayment, there is a need for financial planning. While opting for a home loan, you need to be sure about your EMI amount.

Continue reading to understand how to calculate the home loan EMI.

How Does the Home Loan EMI Calculator Come in Handy?

To calculate home loan EMI, one will use the EMI calculator. It is an online tool that can help understand the EMI amount for a home loan. For example, one can access the home loan EMI calculator on the official website of PNB Housing.

The EMI calculator is free for all with unlimited usage. With an EMI calculator, the loan applicant will understand what part of the income will go towards equated monthly payments. Some details are entered to get the desired result with an EMI calculator.

The three main components of an online EMI calculator are as follows:

  • The principal home loan amount
  • The ROI (Rate of Interest) on a home loan
  • Repayment tenure of the home loan

With an EMI calculator, loan applicants can enter different loan amounts and view the respective EMIs. An EMI calculator can help loan applicants conduct their pre-loan assessment without external help. With the help of sliders, the loan amount and ROI are adjusted.

Besides the EMI amount, an online EMI calculator will also help know the total interest payable. Let us now understand how an online EMI calculator works.

The Formula Used by The EMI Calculator

An online EMI calculator does not involve users in complex calculations. However, you should know the formula used by an online calculator, which is: 

EMI = P * I * (1+I)T / (1+I)T – 1

Let us break down the variables used in the above EMI formula:

  • EMI (Equated Monthly Payment) is the amount paid to the loan provider monthly
  • ‘P’ is the principal component of the home loan
  • ‘I’ is the ROI for the home loan
  • ‘T’ is the repayment tenure for the home loan

Loan applicants do not have to spend time doing heavy calculations. An online EMI calculator will save you from the above calculation.

Key Points to Consider Before Submitting the Home Loan Application

Home loan applicants should know the following things:

  • Loan applicants should make some down payment for a home loan. The principal component of the home loan will decrease after the down payment. Since the principal amount decreases, the overall interest charge also decreases.
  • Choose a lender with an affordable home loan interest rate. The credit score, repayment history, and monthly income of the applicant will affect the interest rate. Many lenders allow home loan applicants to choose between floating and fixed interest rates.
  • The tenure of the home loan also impacts the interest rate. Applicants can choose a longer repayment tenure of 15-20 years for a home loan. Choose a repayment tenure that demands lower interest charges.

Why Use a Home Loan Online EMI Calculator?

There are numerous reasons to use an online EMI calculator.

An online EMI calculator will provide an accurate break-up of the loan repayment throughout the given tenure.

Sometimes, lenders might add the processing fee and stamp duty charges to the principal amount. With an EMI calculator, loan applicants can know the exact principal amount for the home loan.


Loan applicants do not have to go through calculation hassles to know the EMI amount. One can calculate home loan EMI within seconds with an online calculator. Compare different home loans with an online EMI calculator now and get accurate results!

Read: What Exactly Is Credit Origination Software, And How Does It Benefit People?

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