Loan Calculator: See How Extra Payments Cut Your Interest
This loan calculator shows your regular monthly payment and then tests what happens if you pay a little extra every month. You can see the months saved and the interest saved, which helps you decide whether prepaying is worth it.
Estimates for general information. This is not financial advice.
More Finance & Money calculators
View all 10You may also need
From related categoriesHow to use this calculator
- Enter the loan amount, interest rate and term.
- Optionally enter an extra amount you can add to every monthly payment.
- Compare the time to repay and the total interest with and without the extra payment.
The formula
Worked example
For ₹5,00,000 at 10% for 3 years, the regular payment is about ₹16,134 and total interest is about ₹80,809. Adding ₹2,000 a month clears the loan in 32 months instead of 36, with interest of about ₹70,488, a saving of about ₹10,322.
Understanding your result
Extra payments go straight to principal, so every later month charges interest on a smaller balance. The earlier in the loan you add extra, the more interest you avoid.
When to use it
- Decide whether to prepay a personal or car loan.
- Find how many months an extra amount removes from your loan.
- Compare keeping spare cash in savings against paying down debt.
In-depth guide
What an extra monthly payment does
Extra money goes straight to the principal, so the balance falls faster and less interest builds up. The table uses a loan of ₹5,00,000 at 10% for 3 years.
| Extra each month | Months to repay | Total interest | Interest saved |
|---|---|---|---|
| None | 36 months | ₹80,809 | ₹0 |
| ₹1,000 | 34 months | ₹75,292 | ₹5,518 |
| ₹2,000 | 32 months | ₹70,488 | ₹10,322 |
| ₹5,000 | 27 months | ₹59,246 | ₹21,563 |
Should you prepay or invest instead?
Prepaying gives a guaranteed saving equal to the loan rate. Investing may earn more but is not guaranteed. A simple rule is to clear high-interest loans such as personal loans and credit card dues first. For a low-rate loan, compare the rate with what you can realistically earn after tax and risk.
Before you prepay
- Check prepayment charges. Many floating-rate loans to individuals have none, but fixed-rate loans may.
- Keep an emergency fund so you do not need to borrow again.
- Ask whether the lender will shorten your tenure or reduce your EMI. Shortening usually saves more interest.
Limits
The calculator assumes a fixed rate and steady monthly payments. Fees and rate changes are not included, so confirm the final figures with your lender.
Assumptions and limits
Assumes a fixed rate and monthly payments. Prepayment charges, fees and rate changes are not included. Check your lender's prepayment rules before paying extra.
Frequently asked questions
How is this different from the EMI calculator?
The EMI calculator gives the regular payment. This one also simulates month by month so it can show the effect of extra payments.
Do extra payments always save money?
They save interest, but some lenders charge a prepayment fee that can reduce or cancel the saving.
What if I leave the extra amount at 0?
You will see the normal repayment time and total interest.
Is the last payment smaller?
Yes. The final month only needs to cover what is left, so it can be lower than the regular payment.
Can I use it for a home loan?
Yes, for fixed-rate loans. For floating rates, treat the result as an estimate.