About Loan Prepayment Calculator
See exactly how much interest you save by making a lumpsum prepayment on your home, car, or personal loan. Our Loan Prepayment Calculator shows interest saved, tenure reduction, and revised payment schedule — choose to reduce EMI or shorten the loan tenure with the same EMI.
Loan Prepayment Formula
Use these standard formulas for accurate estimates:
Reduced tenure (same EMI)
Reduced EMI (same tenure)
Interest saved
Example Calculation
Example: ₹30L loan @ 8.5%, 20 yrs — prepay ₹5L
| Component | Value |
|---|---|
| Original EMI | ~₹26,000 |
| Tenure reduced to | ~15 yrs 8 mo |
| Interest saved | ~₹8,50,000 |
| Total saving | ~28% less interest |
Benefits of Using This Calculator
Instant results with standard financial formulas
Clear charts and tables for better decisions
Mobile-friendly — works on any device
100% free — no signup or data stored on servers
Built for Indian investors and taxpayers
Compare scenarios side-by-side where applicable
Frequently Asked Questions
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Reducing tenure saves more total interest and you become debt-free sooner. Reducing EMI improves monthly cash flow. If the freed-up EMI can be invested at a higher return than the loan rate, reduce EMI; otherwise, reduce tenure.
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As per RBI guidelines, banks cannot charge prepayment penalties on floating-rate home loans to individuals. Fixed-rate loans or loans from NBFCs may carry a penalty of 2–5% — check your loan agreement.
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Earlier in the tenure is better because EMI in early years has a higher interest component. Prepaying in years 1–5 of a 20-year loan saves significantly more than the same amount prepaid in year 15.
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Yes. Most banks allow multiple partial prepayments. Each prepayment reduces the outstanding principal and saves interest. Use this calculator to model each prepayment event.
Explore More Loan Tools
EMI, Balance Transfer and Loan Eligibility calculators — all free on Investro.
Conclusion
A lumpsum prepayment — even a modest one — can save lakhs in interest on long-tenure home loans because it cuts into the principal early when the interest component is largest. Check your loan agreement for prepayment charges before acting; floating-rate home loans from banks typically have no prepayment penalty.