# Loan Prepayment Calculator

> See how extra monthly payments or a one-time part-prepayment shorten your home or personal loan and how much interest you save, with the EMI unchanged.

Category: India tax & investing · Applies to: India · Last updated: 2026-10-29
Interactive calculator: https://calculators.geekmidst.com/calculators/india-emi-with-prepayment-calculator

Paying more than the EMI reduces the principal faster, so later EMIs carry less interest and the loan ends sooner. This calculator keeps the EMI fixed and shortens the tenure.

Also called: Home loan part-payment calculator, EMI prepayment calculator.

## Inputs
- Outstanding loan (default 5000000)
- Interest rate (per year) (unit %; default 8.5)
- Remaining tenure (unit years; default 20)
- Extra payment every month (default 5000; optional)
- One-time prepayment (optional) (default ; optional)
- Paid in month number (default ; optional)
- Currency (default INR)

## Results
- Interest saved
- New tenure
- EMIs saved
- EMI
- Interest without prepayment
- Interest with prepayment
- New tenure in months

## Formula

```
EMI = P × r × (1 + r)ⁿ ÷ [(1 + r)ⁿ − 1]. Each month: Interest = Balance × r; Balance = Balance + Interest − EMI − Extra (− lump sum in its month), until the balance reaches zero
```

Where:
- P: outstanding principal
- r: annual rate ÷ 12 ÷ 100
- n: remaining months

## Worked example
1. EMI on ₹50 lakh at 8.5% for 240 months = ₹43,391.16; total interest = 43,391.16 × 240 − 50,00,000 = ₹54,13,879.
2. Paying ₹5,000 extra each month clears the loan in 187 months (15 years 7 months).
3. Interest falls to ₹40,24,629, saving ₹13,89,250.

**Result:** An extra ₹5,000 a month on a ₹50 lakh, 20-year loan at 8.5% ends it 53 months early and saves about ₹13.9 lakh of interest.

## What the result means

Prepaying early in the loan saves the most, because that is when the balance and interest are highest. Compare the saving with what the money could earn elsewhere after tax.

## Assumptions and limits
- The interest rate stays the same for the whole loan.
- Prepayments reduce the tenure; the EMI does not change.
- Extra payments are made right after each EMI.
- Prepayment charges (generally not levied on floating-rate home loans to individuals, but possible on others) are not deducted.
- Rate resets on floating-rate loans change the result.

## Questions

### Is it better to reduce the EMI or the tenure?

Keeping the EMI and cutting the tenure saves more interest. Reducing the EMI eases cash flow instead.

### Does prepayment affect my tax benefit?

Under the old regime, lower interest can mean a smaller home-loan interest deduction; compare the tax lost with the interest saved.

## Related calculators
- [EMI Calculator](https://calculators.geekmidst.com/calculators/emi-calculator)
- [Loan Amortization Calculator](https://calculators.geekmidst.com/calculators/loan-amortization-calculator)
- [Home Loan Tax Benefit Calculator](https://calculators.geekmidst.com/calculators/india-home-loan-tax-benefit-calculator)
- [Mortgage Calculator](https://calculators.geekmidst.com/calculators/mortgage-calculator)

_This calculator gives estimates for planning. It is not financial advice, and lenders’ actual terms, fees and rounding may differ._

Source: GM¹X CalcVerse — https://calculators.geekmidst.com/calculators/india-emi-with-prepayment-calculator