How to Calculate Loan EMI and Repayments
Calculate monthly loan payments (EMI), total interest, and full repayment schedule with our free Loan Calculator. Supports mortgage, car, and personal loans.
Steps
Enter the loan amount
Enter the total amount you are borrowing (principal). For a mortgage, this is the property price minus your down payment. For a car loan or personal loan, it is the full amount you plan to borrow.
Enter the annual interest rate
Enter the annual percentage rate (APR) offered by the lender. Ensure you are using the APR (which includes fees) rather than the nominal interest rate for a more accurate total cost calculation.
Set the loan term
Enter the loan duration in months or years. Common terms: mortgage (15, 20, 25, or 30 years), car loan (3–7 years), personal loan (1–7 years). Longer terms mean lower monthly payments but significantly higher total interest paid.
Review the EMI and summary
The EMI (Equated Monthly Instalment) is the fixed amount you pay each month. The summary shows total amount paid, total interest paid, and the interest as a percentage of the principal. These numbers reveal the true cost of borrowing.
Review the amortisation schedule
The full repayment table shows how each payment is split between principal and interest. Early payments are mostly interest; later payments are mostly principal. This is why overpaying early in a loan reduces total interest significantly more than overpaying late.
Understanding the True Cost of a Loan
The monthly EMI is not the full picture of a loan's cost. A 30-year mortgage at 6% on £300,000 has an EMI of approximately £1,799/month but a total repayment of approximately £647,515 — meaning you pay £347,515 in interest, more than your original loan amount. Comparing loans requires looking at APR (Annual Percentage Rate) which includes fees, not just the nominal interest rate; the total interest paid over the full term; and the total cost of ownership including insurance, maintenance (for car loans), or property taxes (for mortgages). The amortisation schedule shows the full breakdown. Use this to compare a 20-year versus 30-year term and decide whether lower monthly payments or lower total interest is more important for your situation.
Frequently Asked Questions
EMI (Equated Monthly Instalment) is a fixed payment amount made by a borrower to a lender at a specified date each month. The EMI is composed of principal repayment and interest on the outstanding balance. The formula is: EMI = P × r × (1+r)^n / ((1+r)^n - 1), where P is principal, r is monthly interest rate (annual rate / 12), and n is number of months.
Making extra payments toward the principal reduces the outstanding balance faster, which reduces the interest charged in subsequent months. For a long-term loan like a mortgage, even small additional monthly payments can save thousands in interest and reduce the loan term significantly. Many loan calculators have an 'extra payment' field — add a monthly overpayment to see how much time and interest it saves.
A fixed interest rate remains constant throughout the loan term, making monthly payments predictable. A variable (or floating) rate changes periodically based on a benchmark rate (like LIBOR or the central bank base rate), so payments can rise or fall. Fixed rates provide certainty; variable rates are sometimes lower initially but carry the risk of increasing. This calculator computes fixed-rate loans. For variable-rate scenarios, run the calculation at both the initial rate and projected higher rates to understand your risk exposure.