Formula used
The calculator reconstructs remaining EMI interest, subtracts the entered foreclosure charge and GST, then compares the net interest saving with the estimated growth forgone by using principal cash today. Obtain an exact dated foreclosure statement before acting.
Example calculation
For Rs 5 lakh outstanding at 14% with 30 months remaining, compare future interest avoided with a 3% foreclosure charge, GST and the return the cash could otherwise earn.
How to use this calculator
- Enter principal outstanding, current rate and remaining EMI count.
- Copy the foreclosure charge from the agreement or lender quote.
- Enter the GST treatment and a conservative alternative return.
- Review interest avoided, charges, cash required and net decision gap.
- Replace the estimate with the lender's dated foreclosure statement before payment.
Important assumptions
- Remaining EMI is reconstructed from principal, rate and tenure.
- Foreclosure charge is a percentage of principal outstanding.
- GST is applied only to that charge.
- Daily interest, documentation fees and tax effects are excluded.
Common mistakes to avoid
- Comparing principal with total future EMIs instead of future interest.
- Ignoring GST, daily interest or contract-specific charges.
- Assuming every floating-rate loan has the same charge rule.
- Using all liquid cash and leaving no emergency reserve.