EMI vs Prepayment Calculator
Find out how much interest and time you can save by putting a one-time lump sum — a bonus, a maturity payout, or any windfall — toward your loan in a specific month, compared side-by-side against paying the loan through to its original tenure with no prepayment at all.
Fill in the form and select "Calculate" to see your results here.
What is the EMI vs Prepayment Calculator?
This calculator answers a very specific question: if you have a one-time lump sum of money — a bonus, an FD maturity payout, a tax refund, or any other windfall — and you put all of it toward your loan in a single month, how much interest and time do you actually save compared with making no prepayment at all? It works for any loan type, not just home loans: personal loans, car loans, education loans, and home loans all follow the same reducing-balance interest math, so the same comparison applies to all of them.
It is important not to confuse this with a Home Loan Prepayment Calculator, which models a different strategy altogether. That calculator assumes you commit to paying a fixed extra amount every single month for as long as the loan runs — a recurring, sustained top-up, specific to home loans. This calculator instead models a single lump sum applied once, in one specific month you choose, on any loan. The two produce very different savings profiles for the same rupee amount: a recurring monthly top-up compounds its benefit every month going forward, while a one-time lump sum's benefit is fixed the moment it is applied and simply plays out over the remaining tenure. If you can commit money every month, the recurring calculator is the more relevant tool; if you have a single windfall to deploy right now, this is the one to use.
How to use this calculator
- Enter the total loan amount, interest rate, and tenure exactly as they appear on your loan agreement or latest statement.
- Enter the lump sum amount you plan to pay toward the loan on top of your regular EMIs.
- Enter the month in which you will make that one-time payment — for example, month 60 if you plan to make it five years into the loan.
- Select "Calculate Savings" to see the interest saved, the time saved, and a side-by-side comparison of the loan with and without the lump sum.
Formula
Both scenarios use the standard reducing-balance EMI formula to fix the monthly instalment, EMI = [P × r × (1 + r)^n] / [(1 + r)^n − 1], where P is the loan amount, r is the monthly interest rate (annual rate ÷ 12 ÷ 100), and n is the tenure in months. The EMI itself does not change when the lump sum is applied — this calculator keeps the EMI fixed and lets the tenure shorten instead, so the "with prepayment" schedule is built month by month as follows:
The calculator then compares the total interest from this accelerated, with-prepayment schedule against the total interest a full, unmodified schedule of the original tenure would have charged with no prepayment at all — the difference is your estimated interest saved.
Example
Consider a loan of ₹25,00,000 at 8.5% p.a. for a tenure of 240 months (20 years), with a regular monthly EMI of ₹21,695.58 that stays the same throughout. Without any prepayment, the full 240-month schedule charges total interest of ₹27,06,939.40. Now suppose you receive a ₹5,00,000 bonus in month 60 — five years into the loan — and put the entire amount toward the outstanding principal that month. Running the month-by-month calculation shows the loan is fully repaid in just 176 months instead of 240, a saving of 64 months, or roughly 5.3 years, and the total interest paid drops to ₹17,97,864.37. That works out to an interest saving of ₹9,09,075.03 from a single one-time payment, while your monthly EMI never changes.
Factors that affect your savings
- Timing of the lump sum matters more than its size alone. A payment made earlier in the loan avoids interest over more remaining months than the same amount paid later, so the exact same ₹5,00,000 payment saves noticeably more if made in month 12 than in month 200. Re-run the calculator with different months to see this effect directly.
- This is a one-time payment, not a recurring one. This calculator applies the lump sum exactly once, in the month you specify. If you can also commit to paying extra every month going forward, use the Home Loan Prepayment Calculator to model that recurring strategy separately, or in combination with this one-time payment.
- EMI is kept fixed; only the tenure shortens. This calculator assumes you continue paying the same EMI after the lump sum, so the loan simply finishes sooner. Some lenders offer to recalculate a lower EMI instead, for the remaining original tenure — that alternative reduces monthly outgo rather than total interest, and is not modelled here.
- Prepayment or foreclosure charges are not modelled. RBI rules prohibit such charges on floating-rate loans to individual borrowers, but fixed-rate loans and loans to non-individual borrowers may still carry a fee. Check your loan agreement and subtract any applicable charge from the estimated savings shown here.
- Fixed rate assumed for the full tenure. The calculator assumes the interest rate you enter does not change for the rest of the loan. If your loan has a floating rate that resets, your actual savings will differ — re-run the calculator with an updated rate when that happens.
Frequently Asked Questions
The Home Loan Prepayment Calculator models a recurring strategy — a fixed extra amount added to your EMI every single month, specifically for home loans. This calculator models a completely different scenario: a single one-time lump sum, such as a bonus or maturity payout, applied once in a specific month, and it works for any loan type — personal, car, education, or home. Use this calculator when you have one windfall to deploy; use the Home Loan Prepayment Calculator when you can commit to paying more every month going forward.
It depends on your full financial picture. Putting a lump sum toward a loan is generally worth considering when your loan's interest rate is higher than the after-tax return you could realistically earn by investing the same amount, and only after you already have an adequate emergency fund and no higher-interest debt (such as credit card dues) outstanding. If those conditions are not met, other uses of the windfall may serve you better than prepayment.
A lump sum reduces your outstanding principal balance the moment it is applied, and every remaining month of the loan then charges interest on that lower balance instead of the original one. Making the same payment in month 12 removes interest for every one of the remaining months, while making it in month 200 removes interest for only the few months left. The earlier the lump sum is applied, the more total months of interest it avoids — so, all else equal, an earlier prepayment of the same amount always saves more.
No. This calculator estimates interest and tenure savings only, and does not subtract any prepayment or foreclosure fee your lender may charge. Reserve Bank of India rules prohibit such charges on floating-rate loans to individual borrowers, but fixed-rate loans and loans to non-individual borrowers may still carry a fee. Check your loan agreement and net any applicable charge against the estimated interest saved before deciding.
Not in the scenario this calculator models. It assumes you keep paying the same regular monthly EMI as before, so the lump sum simply shortens the remaining tenure instead of lowering the EMI. Some lenders offer the alternative of recalculating a lower EMI for the original remaining tenure instead — that approach reduces your monthly outgo rather than the loan term, and typically saves less total interest.
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Calculations are estimates based on the information entered. Actual lender terms, prepayment or foreclosure charges (where applicable), and interest rate changes on floating-rate loans can all affect your real-world savings, and this calculator is not a substitute for a statement from your lender. See our full disclaimer.