Car Loan EMI Calculator

About Car Loan EMI Calculator

Planning to buy a car and thinking about finance? Why not take a car loan and calculate the EMI for it using the car loan EMI calculator. The demand for car loans has rapidly increased since quite a few years now as a car is thought to be one of the most sought after means to travel from one place to another.

People today do not wish to invest all their monetary resources at one disposal to buy a car as the vehicle can be easily purchased on finance in the form of a car loan. Hence, during such times, the car loan EMI calculator becomes more valuable, helping an individual make the right financial decision.

What is Car Loan?

A car loan is a secured loan that an individual can avail from the bank to purchase his dream car. Banks offer car loans at an affordable interest rate and easy EMI system through which the borrower can repay the loan amount taken.

What is a car loan EMI calculator?

A car loan EMI calculator helps you calculate the exact amount of EMI you would have to pay each month to purchase your dream car. It helps you manage your finances accordingly and decide on the car that fits your budget as well as requirement. The tool helps you plan your EMI schedule much in advance.

The tool basically consists of three sliders that require you to enter the car loan amount, interest rate and the tenure. Once you fill in these details, you will get an estimate of the EMI you will have to pay the bank on a monthly basis.

How is car loan EMI calculated?

The EMI of your car loan is calculated on the basis of the below formula:

EMI Amount = [P x R x (1+R)^N]/[(1+R)^N-1]

In the above formula, P stands for the principal amount, N stands for the number of years and R stands for rate of interest.

Since EMI is paid on a monthly basis, the number of years is considered on the basis of per month.

So if you purchase a car loan of `1,00,000 at an interest rate of 10% for 5 years, then the car loan EMI calculator, gives you an exact valuation of the amount you will be paying as interest and the monthly installment you will have to pay towards the car loan taken.

So on the basis of the above example, the total interest payable by the car loan borrower is `27,500 and the total payment that would be made is `1,27500. The monthly EMI would be `2,125 for a tenure of 5 years.

How does a car loan EMI calculator work?

A car loan EMI calculator comes handy, helping you gauge the amount you will have to pay to the lender towards the purchase of your car.

Here is how InvestOnline’s car loan EMI calculator works:

• Enter the car loan amount
• The interest rate at which the bank is issuing you the car loan
• Enter the loan tenure
• On doing this, the details of your monthly EMI along with the total amount and total interest you are liable to pay to the bank are displayed
• InvestOnline’s car loan EMI calculator is easy to use and does not require you to go through any training prior to using it. You can also recalculate the EMI amount by changing the details in the slider to plan your investment purchase in a better way. When you change the details in the slider, the EMI amount too changes accordingly

Factors Affecting Your Car Loan EMI -

There are several factors that have a direct impact on your car loan EMI calculation. Not only does the EMI tenure and principal amount play an important role, the below factors too are equally considered by the banks while giving you a car loan.

• Monthly income
• Age
• Salaried or self-employed
• Car loan scheme
• Credit score

Note: Do not fall for marketing traps set by car companies offering Zero interest loans or bullet payment schemes. In most cases, these loans work out more expensive than a well-negotiated regular loan. Used car loans are always more expensive than first purchase vehicles.

Benefits of Using InvestOnline’s Car Loan EMI calculator -

Using the car loan calculator helps you get the below benefits:

• Assess which EMI tenure suits your repayment capacity on a monthly basis
• Saves you from the hassles of calculating the EMI manually
• Gives you a comprehensive view of the interest you would be paying on your principal amount and the exact amount of EMI you will have to pay each month
• Helps you plan your budget prior to purchasing the car, thus saving you from the financial crisis in the future
• Erases the possibility of any human errors and provides you with accurate results
• You don’t need to consult anyone as it gives you a complete breakdown of the EMI tenure
• Using the car loan EMI calculator, you can compare your EMIs as per the different interest rates offered by different banks
• Once you have entered the details, you get an instant EMI quote which helps you plan your car purchase decision in a better way
• You can calculate the EMI amount as many times as you want by changing the variables in the sliders of the calculator

FAQs on Car Loan EMI calculator -

Does the InvestOnline car loan EMI calculator show the same details as the calculator offered by banks?

Yes, all the car loan EMI calculators use the same formula and display exact results as per the details entered.

Can I calculate car loan EMI amount in an excel sheet?

If you are good with formulas, then you can do so. But it is always advisable to use a car loan EMI calculator to get accurate results.

What happens if I take a car loan for a longer tenure?

Longer the loan tenure, lower the car loan EMI.

What is the current interest rate at which banks are offering car loans in India?

The current interest rate at which banks are offering car loans in India is between 8-12%.