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Car Loan EMI Calculator

Last Updated 26th Sep 2017

Car Loan Calculator India

Interest Rate Starting @9.25%
Lowest EMI per lakh Rs. 1,622
Prepayment charges Nil
Loan Tenure 7 years
Loan to Value Upto 100%
  • Loan amount - Higher the loan amount, higher will be the EMI.
  • Rate of interest -Lower the interest rate, lower the EMI.
  • Work profile -Employees of large companies get lower rates leading to lower EMI.
  • CIBIL Score -High CIBIL Score helps in getting lower rates on car loans.
  • Loan Tenure -Longer the loan tenure, lower the EMI.
Car Loan EMI Calculator
Rs.

Lowest Car Loan EMI per Lakh Sep 2017

Bank Lowest EMI per Rs. one lakh, Tenure New Car Lowest EMI per Rs. one lakh, Tenure Used Car
Andhra Bank Rs. 1,619 for 7 years Rs. 2,086 for 7 years Explore More Apply Now
Axis Bank Rs. 1,712 for 7 years Rs. 0 for 7 years Explore More Apply Now
Bank of Baroda Rs. 1,647 for 7 years Rs. 3,248 for 7 years Explore More Apply Now
Bank of India Rs. 1,627 for 7 years Rs. 3,196 for 7 years Explore More Apply Now
Bank of Maharashtra Rs. 1,619 for 7 years Rs. 2,110 for 7 years Explore More Apply Now
Central Bank of India Rs. 1,594 for 7 years Rs. 2,115 for 7 years Explore More Apply Now
Corporation Bank Rs. 1,617 for 7 years Rs. 0 for 7 years Explore More Apply Now
Federal Bank Rs. 1,656 for 7 years Rs. 2,182 for 7 years Explore More Apply Now
HDFC Bank Rs. 1,622 for 7 years Rs. 2,275 for 7 years Explore More Apply Now
ICICI Bank Rs. 1,699 for 7 years Rs. 2,405 for 7 years Explore More Apply Now
IDBI Bank Rs. 1,658 for 7 years Rs. 0 for 7 years Explore More Apply Now
Indian Bank Rs. 1,658 for 7 years Rs. 2,270 for 7 years Explore More Apply Now
IndusInd Bank Rs. 2,157 for 5 years Rs. 0 for 5 years Explore More Apply Now
Karnataka Bank Rs. 2,137 for 5 years Rs. 3,440 for 5 years Explore More Apply Now
Kotak Bank Rs. 2,199 for 5 years Rs. 2,485 for 5 years Explore More Apply Now
OBC Rs. 1,581 for 7 years Rs. 3,341 for 7 years Explore More Apply Now
PNB Rs. 1,584 for 7 years Rs. 2,184 for 7 years Explore More Apply Now
SBI Rs. 1,619 for 7 years Rs. 1,822 for 7 years Explore More Apply Now
Tamilnad Mercantile Bank Rs. 2,189 for 5 years Rs. 2,212 for 5 years Explore More Apply Now
Union Bank of India Rs. 1,609 for 7 years Rs. 2,224 for 7 years Explore More Apply Now
United Bank of India Rs. 1,627 for 7 years Rs. 0 for 7 years Explore More Apply Now

Car Loan Calculator

EMI Calculator for Car Loan

  • The monthly amount calculated by the EMI calculator for vehicle loan is the fixed money you pay to the bank towards payment of principal and interest.
  • For a car loan at 9.25% interest rate, the EMI per Rs. one lakh loan amount is as below:
Loan Tenure 2 years 3 years 5 years
EMI amount for loan amount Rs. 1 lakh at 9.25% Rs. 4,580 Rs. 3,192 Rs. 2,088
Total amount you pay back to the bank including principal and interest Rs. 109,919 Rs. 114,898 Rs. 125,279
Interest you have to pay over loan tenure Rs. 9,919 Rs. 14,898 Rs. 25,279

At the lowest vehicle loan rate of 9.25% the lowest EMI for a tenure of 5 years is Rs. 2,088 per lakh. In this case you have to pay an interest of Rs. 25,279 on your loan amount of Rs. 1 lakh over a period of 5 years.

If you decide to take a loan for 2 years only, for the same rate of interest you will pay a higher EMI of Rs. 4,580. In this scenario you pay a total interest of Rs. 9,919 on your loan amount of Rs. 1 lakh over a period of 2 years, which is less than half of what you paid for a 5 years loan.

Car Loan EMI Calculator Formula

Apart from online car loan calculator, you can also calculate your monthly EMI with a mathematical formula.
You can calculate the monthly payment (EMI) yourself using the following equation

E= P. r. (1+r)^n/[(1+r)^n -1]

Where,

  • P represents the principal amount that you want to apply for
  • r is the rate of interest per month which is calculated as rate of annual income/ (12*100)
  • n is the tenure of loan in months
  • E represents the monthly payment or EMI

Car Loan Calculator Benefits

EMI calculator calculates your house loan EMI and has multiple benefits, which are listed below -

  • Saves time: EMI calculator saves your time by calculating EMI in seconds and does not waste your time in doing tedious and time consuming calculations. You'll get the output immediately as you'll enter the loan related details.
  • Accurate results: Manual calculations can sometimes lead to wrong results which can change your loan EMI and make you change your decision while taking vehicle loan. That's why, it is well-advised to use online EMI calculator to get correct results.
  • Plan your finances: vehicle loan EMI calculator tells you about EMI and also let you know that you would be able to pay that amount back or not. Always go for the amount that won't affect your budget and also not affect your credit score if you are default in payments.
  • Allows evaluating multiple schedules: EMI calculator also allows you to view the amortization schedules and EMIs for various combinations of loan tenures and interest rates, thus allowing you to choose the EMI that suit your repayment or servicing capabilities.

Car Loan Interest Calculator – Impact on EMI

Flat Rate method, Reducing Balance method and Zero Interest Scheme Illustrations:

Your loan EMI will be higher in case of loan on flat rate while EMI will be lower with reducing rate.

Flat interest rate: Here the interest is calculated on the original principal amount for the entire period. So, if you opt for a vehicle loan of Rs. 5 lakhs at 10% flat rate of interest for a period of 5 years, the EMI will be Rs. 12,500. Here, the total interest per year will be 500,000* (10/100) = 50,000. Thus, total interest in 5 years = 50,000 * 5 = 250,000. This interest along with principal amount is distributed over the entire loan period to arrive at monthly EMI. Here the impact of repayment of capital is not considered.

Reducing balance method: In this method, the interest rate is charged only on the outstanding amount of the loan. Generally in this case the interest rate is higher than the flat rate but actually it may turn out to be cheaper as the interest is paid only on the remaining principal amount. Every month some part of EMI goes towards principal amount, thus the interest is charged on the remaining amount. Hence there will be a gradual reduction of the principal amount and as a result of the same, interest will be applicable on the lesser amount. So, if you opt for a vehicle loan of Rs. 5 lakhs at 10% rate of interest for a period of 5 years, the EMI will be Rs. 10,624.

Zero interest schemes (also called 0% finance scheme) – This is one of those free lunches that actually doesn’t exist. So, beware of schemes that claim to offer zero interest. It is likely that the car company is offering a subvention scheme whereby the interest is paid by it to the bank upfront. Now, you could always ask the car dealer for the same amount as a cash discount. It’s like padding up the price of the car for the interest amount and marketing it under a nice name.

Vehicle Loan Prepayment

Part prepayment is a huge amount that you pay before the due date of your EMI when you have surplus money with yourself. When you part prepay your loan, bank gives you two options

  • To reduce your EMI and keep the tenure same
  • To keep the EMI same and reduce your repayment tenure

The choice between the two options depends on your choice which is also a function of your repayment capacity on a monthly basis.

Car Loan EMI - Modes of Payment

  • The most convenient way of paying a vehicle loan EMI is by way of ECS mandate in favor of the bank from which the vehicle loan has been availed.
  • Note that it is not necessary to hold a bank account with the same bank. One can issue an ECS mandate from one’s salary account or normal bank account.
  • Key benefit of paying EMI through ECS is that there is no risk of cheque bouncing due to signature mismatch or any technical issue.
  • Other modes can include post dated cheques and payments by demand drafts, though these are rarely used nowadays.

Car Loan Repayment Tenure

Most of the banks offer car loan for a maximum period of 7 years. If you apply for longer repayment tenure, your EMI for car loan will be less. However, longer loan tenure increases the amount of interest payment which makes your car loan costly.

Monthly EMI

Monthly EMI depends upon your income and expenses. Generally, banks advise you to limit your EMI to 35% to 45% of your net income so that you can pay your EMI without any burden or difficulty. You can calculate your EMI online which will help you to know your repayment capacity.

Frequently Asked Questions on EMI Calculator Car Loan

What if I miss EMI payment or there is an ECS bounce?

If you miss your EMI payment or if there is an ECS bounce then bank may charge a penalty. In addition, it will also be reflected in your CIBIL report and your CIBIL score may get impacted.

What if I get delay in paying the vehicle loan EMI?

Banks charges penalty for delaying EMI payment. The amount of penalty varies from bank to bank.

Why it is necessary to calculate EMI beforehand?

It is important to calculate your EMI in advance to maintain stability in future payments. When you avail car loan, you promise the bank to pay a fixed amount at fixed date every month. So, before availing the loan you should consider the stability of your income, monthly expenses and the existing loan obligations to avoid any discrepancies in future payments.

Does the loan tenure affect my EMI for car loan?

Car loan can be availed for maximum tenure of 7 years. Tenure affects your monthly EMI. Longer the tenure of car loan, lower will be your EMI.

How MyLoanCare EMI calculator helps in calculating EMI?

MyLoanCare Car Loan EMI calculator calculates the EMIs of different banks as per the details entered by you. You can easily compare the EMIs and opt for the best option. You also get to know about the interest charged on loan amount entered.

What are two methods of paying car loan EMI? Which one is better?

Car loan EMI can be paid under two schemes:

  • EMI in arrears scheme – this is the standard method of paying EMI where the interest for a month (and principal repayment) is payable at or after the end of the month.
  • Advance EMI scheme – you pay interest and EMI at the beginning of the month. So, each month, you pay interest on amount that you have already repaid to the bank at the beginning of the month.

Note - In case your bank charges EMI in advance, the EMI amount should be about 1% lower than that in case of EMI in arrears. For those interested in more precise figures, EMI per Rs. one lakh loan amount on a 60 month car loan at 10% rate of interest as per EMI in arrears method comes to Rs. 2,125 while that as per EMI in advance method comes to Rs. 2,107.

Is the car loan EMI fixed or can it change in future

Here are some situations in which your EMI can change:

  • In case the floating rate of interest on your car loan increases, your bank will typically keep the EMI constant but increase the loan tenure. So, you will pay the same EMI but for a longer duration. However, in case the interest rates increase to an extent that the revised loan tenure is more than the maximum permissible by your bank, the bank may increase your EMI amount.
  • For partly disbursed loans availed under tranched EMI scheme, your loan EMI will increase with each disbursement.
  • When you make a prepayment of your loan, you can opt to either reduce the EMI and keep the loan tenure unchanged or keep the EMI unchanged and reduce the loan tenure. It is more beneficial to keep the EMI same and reduce the loan tenure.
    However, you may opt to reduce the EMI in case you desire so.
  • Any other situations as per terms and conditions of the loan agreement.

Why MyLoanCare???

Nowadays, banks give various offers on Car Loan to give the best rates to individuals. To get Car Loan with lowest interest rate and lowest EMI, compare new rates and offers of all banks at MyLoanCare. You can do rates comparison, check your eligibility, apply online and get the cheapest rate on Car Loan. MyLoanCare helps you throughout the loan process from the day you apply to the time you get complete disbursement. You can even track your loan status after getting registered with us. MyLoanCare make it easy for you to get hassle free Car Loan with ultimate cashback and refer and earn benefits. So, apply for Car Loan today and enjoy the benefits.

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