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PNB Car Loan EMI Calculator

PNB Car Loan Calculator India 2020

Last Updated 17th Sep 2020

  • Get monthly EMI as low as ₹ 1,596 per lakh with PNB now offering vehicle loans with loan tenure upto 7 years.
  • Lowest car loan interest rate currently offered by PNB is 8.75%, for which the EMI per ₹ 1 Lakh loan amount comes to ₹ 4,557 for a 2 year loan and ₹ 2,064 for a 5 year loan.
Loan Amount2 Year Loan4 Year loan7 Year loan
₹ 3 Lakh₹ 13,671₹ 7,430₹ 4,789
₹ 6 Lakh₹ 27,342₹ 14,860₹ 9,578
₹ 12 Lakh₹ 54,684₹ 29,720₹ 19,155
Car Loan EMI Calculator
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Car Loan EMI Calculator PNB

PNB Car Loan EMI

  • Car loan EMI (or equated monthly installment) is a fixed amount of money paid by you to PNB against the loan taken. This is towards repayment of your loan to the bank. Every month, it is due on a fixed day of the month till your loan is fully paid back.
  • With PNB offering vehicle loans with loan tenure upto 7 years, the loan EMI can be as low as ₹ 1,596 per lakh, to make it more affordable and convenient to meet your car needs. Rate of interest offered by PNB are as low as 8.75%.

The EMI consists of both interest payment and principal repayment. Though the EMI amount will remain constant, the principal component keeps increasing and on the other hand the interest component keeps reducing.

Features of PNB Car Loan

  • Borrower age should be between 21 years to maximum 65 years.
  • Maximum vehicle loan amount offered by PNB is upto 85% of on-road price.
  • Interest rates starts @ 8.75% depending upon down payment, net income and other factors.
  • Processing fee in PNB is 1.00% of the cost of the car Maximum ₹ 6,000.

Car Loan EMI Calculator PNB at different tenure

Car Loan EMI for different loan amounts and tenures @ 8.75% interest rate
Loan Amount 2 Years 3 Years 5 Years 7 Years
1 Lakh₹ 4,557₹ 3,168₹ 2,064₹ 1,596
3 Lakh₹ 13,671₹ 9,505₹ 6,191₹ 4,789
5 Lakh₹ 22,785₹ 15,842₹ 10,319₹ 7,981
10 Lakh₹ 45,570₹ 31,684₹ 20,637₹ 15,962
  • As you can see in the above table, for various loan amounts taken at the lowest rate of interest, EMI differs with changes to tenure at 2 to 7 years. Your EMI is higher when you take loan for a shorter tenure of 2 years and it is lower when you apply for a higher tenure of 7 years.
  • Your EMI consists of both interest payment and principal repayment. Though the EMI amount will remain constant, every month the proportion of interest payment and principal repaid within each EMI is different. With every EMI, the proportion of principal repayment in EMI keeps increasing and the interest component in EMI keeps reducing.

Use EMI Calculator to calculate your interest on vehicle loan at different tenure

Vehicle Loan EMI for ₹ 1 Lakh loan amount at lowest 8.75% interest rate offered by PNB for different tenures
2 years 3 years 5 years
PNB EMI for a loan amount ₹ 1 Lakh at 8.75% ₹ 4,557 ₹ 3,168 ₹ 2,064
Total amount you pay back to the bank including principal and interest ₹ 1,09,368 ₹ 1,14,061 ₹ 1,23,823
Interest you have to pay over loan tenure ₹ 9,368 ₹ 14,061 ₹ 23,823

The above table shows the longer your loan tenure, lower is the EMI you pay on the loan. However, your total interest outgo is significantly higher in a long tenure loan. In the above example, if you take a ₹ 1,00,000 loan for a period of 5 years, you pay the lowest EMI of ₹ 2,064. However, you pay an interest of ₹ 23,823 on a ₹ 1,00,000 loan.

In contrast, if you take a ₹ 1,00,000 loan from PNB at the lowest loan rate offered for a period of 2 years, you pay a higher vehicle loan EMI of ₹ 4,557 and pay an interest of only ₹ 9,368 which is less than half of what you paid in 5 year loan. Hence, it is advisable to choose your loan tenure wisely as longer tenure means high interest expenses.

Factors affecting PNB Car Loan EMI

  • Loan amount – This is the amount borrowed by a borrower from PNB. If you apply for a higher loan amount, your monthly EMI will be high. PNB gives maximum loan of 85% of on-road price of the car.
  • Interest rate - Interest rates is the rate charged by PNB on your vehicle loan. Higher interest rate increases your loan EMI which will increase the total cost of the loan. Lowest interest rate offered by PNB is 8.75%. However, it is advisable to do complete market research and compare rates online before you apply for loan.
  • Loan tenure – This is the period in which you can repay your loan in PNB. Longer loan tenure means lower car loan EMI. Generally, PNB offers loan for a maximum tenure of 7 years.

Car Loan Amortization Calculator

An amortization schedule is a table of periodic loan payments that shows the amount of principal and the amount of interest that comprise each payment until the loan is paid off at the end of its term.

In the Amortization schedule, your Car Loan monthly EMI will be equal, but the component of EMI, which consists of interest payment and principal payment will not remain the same every month, it keeps on changing.

Illustration: How to read an amortization schedule

Suppose if you take a Car Loan of ₹ 2 Lakh for 2 years at an interest rate of 9.25%. EMI calculated for this loan amount is ₹ 9,160 and the total annual EMIs to be paid annually is ₹ 1,09,919. The EMI schedule of loan for 2 years is explained below in the table –

Amortization Schedule for a Car Loan of ₹ 2 Lakh over the 2 years

Year Interest paid during the year Principal repaid during the year Total amount paid during the year (Interest + Principal) Outstanding Principal
2020 ₹ 5,813 ₹ 30,827 ₹ 36,640 ₹ 1,69,173
2021 ₹ 11,547 ₹ 98,372 ₹ 1,09,919 ₹ 70,801
2022 ₹ 2,478 ₹ 70,801 ₹ 73,279 ₹ 0

Each Car Loan EMI consists of both amounts of interest as well as the principal repaid. The interest component of EMI goes down while the principal component goes up in both cases while doing the calculation.

In the above illustration, on a Car Loan of ₹ 2 Lakh, taken at the lowest interest rate of 9.25%, EMI paid is ₹ 9,160 and an annual total of EMIs is ₹ 1,09,919, the interest component is ₹ 14,523 while the principal component is ₹ 95,396 in year 1 of loan disbursement. You repay only 47.7% of the total principal after paying 12 EMIs during the first year.

In year 2, the interest component of EMI is around 4.84%, while the principal component is around 95.16%. Upto 2 years, you have cumulatively repaid 100% of your total Car Loan.

PNB Car Loan Calculator Formula

Emi Calculator Formula

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

Here is an illustration of how PNB Car Loan EMI is calculated:

Let’s say you take out a car loan for ₹ 7,00,000 to be paid back over five years (or 60 months) at an interest rate of 10%. Your monthly payments for this loan after applying the above formula would be ₹ 14,873.

In above formula,

P = loan amount. This should be 85% of on-road price

n = tenure in months. For PNB, this can be 7 years.

r = rate of interest per annum. Current PNB interest on car loan is 8.75%

Tips to decide the right amount of EMI

  • Ascertain the amount you need to borrow: It is important that before approaching a bank for loan, you need to estimate the amount of loan you need to borrow. Limit your loan amount after accounting for your own available funds. Also, based on the EMI you can service, try to opt for lowest tenure of loans as long tenure loans result in huge interest outgo.
  • Review your current obligations: Before, taking a loan it is advisable to do an evaluation of your current monthly expenses including any EMI obligations that you have on your current loans. The assessment will help you to estimate the amount of EMI you can pay comfortably after taking into account other obligations. Once you arrive at the EMI you can service, you can also decide on the right loan tenure.
  • Calculate your PNB car loan eligibility: Your eligibility is an assessment of your repayment capacity based on your monthly income. PNB provides an LTV upto 85 % of on-road price and expects the borrower to fund the remaining value of property by own money. For example, at its lowest LTV, PNB would expect its borrowers to provide margin money. In case this margin payment is higher than your available funds as estimated by you, you might need to look for higher LTV loans, which may carry higher interest rates and hence, will result in higher EMIs.
    • Multiplier based loan amount eligibility – PNB calculates your loan amount eligibility by applying a multiplier to your net take home salary. This is the simplest method for calculating a loan eligibility used by banks. Generally it is 2.5 to 3 times the annual salary for salaried individuals and 6 times the annual income for self-employed professionals. The multiplier depends on the bank’s internal categorization of your employer company based on its reputation, stability, size and growth in turnover.
    • FOIR based loan amount eligibility – PNB will also estimate your Fixed Income to Obligations Ratio (FOIR) to ascertain the maximum EMI you can service based on your current income and other monthly expenses. The bank applies a certain ratio to your income to estimate your monthly expenses and then adds your other EMI obligations to calculate your fixed obligations. The proportion of fixed income to your calculated fixed obligations gives your FOIR. Generally, banks lend up to a maximum FOIR of 0.50. Based on the FOIR, the bank will also estimate the maximum amount of EMI you can service as a borrower. PNB's assessment may be different from your own assessment. Any differences in assessment may require you to readjust your loan amount requirement. You may also consider paying back other running short term loans to improve your eligibility.

Quick guide on PNB Car Loan

  • Key Features
    • Loan available for both salaried and self employed.
    • Borrowers within the age group of 21 and 65 years.
    • Maximum loan tenure of 7 years.
    • Interest rates in the range of 8.75% to 9.20%.
    • Lowest EMI of ₹ 1,596 per lakh.
  • Processing Fees: 1.00% of loan amount. Maximum ₹ 6,000
  • PNB vehicle loan calculator calculates EMI considering a combination of loan amount, interest rate and loan tenure.

Car loan EMI – EMI changes in case of prepayment

In case you prepay your vehicle loan, a small penalty is levied. Prepayment in PNB is Nil. When you prepay, the outstanding balance on your vehicle loan reduces. PNB gives you two options:

  • Reduce your loan tenure and keep EMI on your car loan unchanged: This option allows you to close your loan earlier and save the interest outgo associated with the remaining tenure. This is suitable for borrowers who feel that they have adequate income to continue servicing the same level of EMIs.
  • Reduce the amount of EMI and keep your loan tenure same: This option allows you to reduce your monthly EMI and hence, increases the availability of monthly surplus which you can deploy for other purposes. This is suitable for borrowers who anticipate higher monthly personal expenses and hence, would want to reduce their monthly EMI obligations.

FAQs

Why should I calculate PNB loan EMI before taking a loan?

It is advised to calculate vehicle loan EMI prior to taking a loan. There are several benefits of calculating your PNB housing loan EMI as discussed below-

  • In case EMI comes out to be more than your monthly budget, then you have the chance to apply for a lower loan amount which fits your monthly budget and makes EMI easily affordable.
  • If you already know the EMI you have to pay each month, then you can plan your spending accordingly.
  • Based on the EMI amount, you can opt for making prepayment of your car loan in future when you have surplus amount.

What is the lowest EMI per lakh offered by PNB on Car loan?

PNB offers car loan at 8.75% interest rate and hence lowest EMI on per lakh loan amount is ₹ 1,622

Can I prepay my PNB car loan?

PNB offers you an option of prepayment at Nil charges.

Is there any processing charge on car loan from PNB?

Car Loan from PNB charges a processing fee of 1.00% of loan amount Maximum is ₹ 6,000

Will I get the car loan from PNB if I have a bad credit score?

No, for taking a loan from PNB, an applicant must have a good credit score of 700 and above. Usually, most of the banks avoid giving loans if you have low credit score.

How does a car loan repayment happen?

The repayment of a car loan happens in the form of an EMI (Equated Monthly Installment) through the customer's bank account. The customer is required to present a few post dated cheques and sign an ECS mandate in favor of the bank at the time of disbursing the loan.

Can I have a co-applicant while applying for a Car loan with PNB?

Yes, you can opt for a co-applicant to take car loan from PNB that will increase your car loan eligibility as the income of the co-applicant is also taken into account.


PNB Car Loan News - Sep 2020
  • 2020-08-25 : PNB to offer one-time loan restructuring option
    Punjab National Bank is planning to provide a one-time loan restructuring window to corporate and retail loans like home, personal, gold, two-wheeler, car, along with business and mudra loans. The plan is to assist customers whose income has decreased due to COVID-19 pandemic and subsequent lockdown.
  • 2020-08-24 : PNB Q1FY21 net profit at Rs. 475.19 crore
    Punjab National Bank posted a net profit of Rs.475.19 crores for the period ended June 30, 2020, as against a net loss of Rs.596.99 crores for the period ended March 31, 2020. In addition to this, the bank reported total income of Rs.24727.72 aided by retail loans like home, personal, car, two-wheeler and gold loan along with business and mudra loans.
  • 2019-08-28 : Punjab National Bank links retail loans with repo-rate
    With effect from August 27 2019, Punjab National Bank linked its retail loan rate with a repo rate. This will make Housing and car loans, cheaper for borrowers, priced at 8.25%-8.35% and at 8.65%, respectively. The repo rate linked loan is 0.25% cheaper than the MCLR rate.
  • 2019-07-02 : PNB makes home loans cheaper
    Punjab National Bank (PNB) has cut its lending rates by 5 basis points which will make all the loans, including home loans, auto loans, and mortgage loans cheaper. These loans are benchmarked at a one-year MCLR rate, which is 8.40% at present as compared to 8.45% earlier. The rates are effective from July 1, 2019.
  • 2018-04-30 : Two-wheeler loans grow 32%
    Led by non-bank lenders, two-wheeler loans experienced an impressive 32% growth in 2017. The gross loan portfolio for the bike loan segment grew to Rs. 39,100 crore as on December 2017. Gujarat had been reported as having the highest non-performing assets (NPAs).
*Terms and conditions apply. Credit at sole discretion of lender subject to credit appraisal, eligibility check, rates, charges and terms. Information displayed is indicative and from collected from public sources. Read More
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