Car Loan EMI Calculator
Estimate the monthly instalment (EMI) on a car loan based on the loan amount, interest rate and tenure you enter. Car loans are secured against the vehicle itself, so they usually carry lower interest rates than personal loans, but shorter tenures than home loans — use this calculator to see exactly what that means for your monthly outgo.
Fill in the form and select "Calculate" to see your results here.
What is the Car Loan EMI Calculator?
This calculator works out the fixed monthly instalment (EMI) you would pay on a car loan, given the amount financed, the annual interest rate, and the repayment tenure. A car loan is secured against the vehicle you're buying — the lender holds a lien on the car until the loan is repaid — so it typically carries a lower interest rate than an unsecured personal loan, though usually higher than a home loan. Because a car depreciates in value from the day you drive it out of the showroom, lenders generally cap the tenure at around 5 to 7 years and finance only a portion of the on-road price. Knowing your EMI upfront, under a standard reducing-balance schedule, helps you judge whether the loan fits comfortably into your monthly budget before you sign.
How to use this calculator
- Enter the loan amount you plan to finance — this is typically the car's price minus your down payment, not the full on-road price.
- Enter the annual interest rate quoted by the lender (car loan rates in India commonly range from around 8% to 14%, depending on whether the car is new or used and your credit profile).
- Enter the loan tenure in years — most car loans run from 1 to 7 years.
- Select "Calculate EMI" to see your monthly instalment, total interest payable, and total amount you'll repay over the tenure.
Formula
This is the standard reducing-balance EMI formula used by banks and NBFCs across India for fixed-rate instalment loans. Each EMI is split between interest (calculated on the outstanding balance) and principal repayment; the interest portion is highest in the early months and falls steadily as the balance reduces.
Example
Consider a car loan of ₹8,00,000 at an interest rate of 9.5% per annum, repaid over a tenure of 5 years (60 months). The monthly interest rate works out to 9.5 ÷ 12 ÷ 100 = 0.007917. Applying the EMI formula gives a monthly instalment of approximately ₹16,801.49. Over 60 months, the total amount repaid is about ₹10,08,089.34, meaning total interest of roughly ₹2,08,089.34 — about 26% of the original loan amount, which shows why comparing rates and tenures across lenders is worth the effort before financing a car.
Factors that affect your car loan EMI
- Loan amount. A larger financed amount increases the EMI proportionally, all else being equal.
- Down payment. Lenders typically finance 80-90% of a car's on-road price, so a larger upfront down payment reduces the amount you borrow — and therefore reduces your EMI and total interest — while a smaller down payment increases both.
- Interest rate. Car loan rates depend on whether the car is new or used, the lender, your credit score and income profile. New-car loans generally get the lowest rates; used-car loans usually carry a higher rate because the vehicle depreciates faster and is harder to value precisely.
- Tenure. Car loans are typically capped at 5 to 7 years, shorter than a home loan, partly because the car itself is depreciating collateral that loses value faster than the outstanding loan balance would otherwise reduce. A longer tenure lowers the EMI but increases total interest paid; some lenders offer a lower rate in exchange for a shorter tenure.
- Processing fees and other charges. This calculator estimates the EMI on the financed principal only. Processing fees, insurance premiums, registration and road tax are usually paid separately or folded into the down payment, and are not included in this EMI calculation.
Frequently Asked Questions
Yes. Most lenders cap car loan tenure at around 5 to 7 years, while home loans can run up to 20-30 years. A car depreciates in value over time, whereas the property backing a home loan typically holds or grows in value, so lenders limit car loan tenure to reduce their risk as the collateral's value falls.
Yes. Lenders usually finance 80-90% of the car's on-road price, so the rest is your down payment. A larger down payment reduces the amount financed, which directly lowers your principal and therefore your monthly EMI and total interest paid over the tenure.
Yes, used-car loans typically carry a higher interest rate than new-car loans, often by 1-3 percentage points. Lenders see used vehicles as higher risk collateral because they depreciate faster and are harder to value precisely, and used-car loan tenures are usually shorter as well.
Generally, no. For a car bought for personal use, the interest paid on a car loan is not tax-deductible under Indian income tax law, unlike home loan interest. An exception can apply if the vehicle is used for business purposes and the interest is claimed as a business expense — check with a tax professional for your specific situation.
No. This calculator computes the EMI based only on the financed loan principal, interest rate and tenure you enter. On-road price components like insurance, registration, road tax and accessories are typically paid upfront or added to the down payment, and are not part of this EMI calculation.
Related calculators
Calculations are estimates based on the information entered. They do not account for processing fees, insurance, registration costs, prepayment charges, or changes to a floating interest rate, and are not a loan offer or a substitute for the amortization schedule provided by your lender. See our full disclaimer.