Reduce EMI vs Tenure Calculator India

Formula used

Both options start after the same principal prepayment. The lower-EMI option keeps the original remaining tenure and recalculates EMI. The shorter-tenure option keeps the original EMI and solves the remaining payment count, allowing a like-for-like interest comparison.

Example calculation

For Rs 50 lakh outstanding at 8.5% with 180 months left, test a Rs 5 lakh prepayment. Lower EMI improves monthly cash flow; keeping EMI unchanged usually saves more interest and closes the loan sooner.

How to use this calculator

1. Enter principal outstanding, current rate and remaining months.
2. Enter the amount you plan to prepay.
3. Compare the recalculated EMI with the solved shorter tenure.
4. Review interest under both options and the extra saving from shorter tenure.
5. Confirm the chosen instruction and revised schedule with the lender.

Important assumptions

• The rate remains unchanged after prepayment.
• The lower-EMI option retains the original remaining tenure.
• The shorter-tenure option retains the original EMI.
• Charges, daily interest and tax benefits are excluded.

Common mistakes to avoid

• Assuming the lender will apply the preferred option automatically.
• Comparing only EMI relief and ignoring total interest.
• Prepaying before protecting emergency liquidity.
• Using an outdated principal, rate or remaining tenure.

When this tool is useful

• When you want a fast estimate before making a financial or salary decision.
• When you want to compare different assumptions in seconds.
• When you want to understand the formula behind the result.