Securing Hannav Ledger...
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Plan your home purchase with accurate EMI estimates, down payment analysis, loan-to-value ratio, and annual prepayment savings. Designed for Indian home buyers.
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EMI = P × r × (1+r)^n / [(1+r)^n − 1]Loan Amount = Property Cost − Down Payment. EMI is computed on the net loan amount using the standard reducing-balance formula. Annual prepayments reduce outstanding principal each year, saving interest.
This calculator takes the total property cost, subtracts your down payment to determine the net loan amount, and then applies the standard EMI formula: EMI = P × r × (1+r)^n / [(1+r)^n − 1]. It also computes the Loan-to-Value (LTV) ratio, which banks use to decide eligibility. If you enter an annual prepayment amount, the calculator simulates a year-by-year reduction in principal, showing you exactly how much interest you save over the life of the loan.
The EMI formula is: EMI = P × r × (1+r)^n / [(1+r)^n − 1], where P is the loan principal (Property Cost − Down Payment), r is the monthly interest rate (Annual Rate ÷ 12 ÷ 100), and n is the total number of monthly installments (Tenure × 12). For example: Property Cost = ₹75,00,000, Down Payment = ₹15,00,000, Loan = ₹60,00,000, Rate = 8.5% → r = 0.007083, Tenure = 20 years → n = 240. EMI = 60,00,000 × 0.007083 × (1.007083)^240 / [(1.007083)^240 − 1] = ₹52,069.
Example 1: Property ₹75L, Down Payment ₹15L, Loan ₹60L at 8.5% for 20 years → EMI = ₹52,069, Total Interest = ₹64,96,654, Total Payment = ₹1,24,96,654. | Example 2: Property ₹50L, Down Payment ₹10L, Loan ₹40L at 8.0% for 15 years → EMI = ₹38,225, Total Interest = ₹28,80,552, Total Payment = ₹68,80,552. | Example 3: Property ₹1.2 Cr, Down Payment ₹30L, Loan ₹90L at 9.0% for 25 years → EMI = ₹75,565, Total Interest = ₹1,36,69,410, Total Payment = ₹2,26,69,410. With ₹2L annual prepayment, interest drops to ₹1,07,41,000 — saving ₹29.28 Lakhs.
The Loan-to-Value (LTV) ratio is the percentage of the property cost that the bank finances. RBI guidelines cap LTV at 90% for loans up to ₹30 Lakhs, 80% for ₹30–75 Lakhs, and 75% for loans above ₹75 Lakhs. A higher down payment (lower LTV) reduces your loan burden, lowers total interest, and may help you negotiate a better interest rate. Most financial advisors recommend a minimum down payment of 20%.
An annual prepayment is an additional lump-sum amount paid toward the loan principal every year, beyond your regular EMI. This directly reduces the outstanding balance, which means subsequent months generate less interest. For a ₹60L loan at 8.5% over 20 years, an annual prepayment of just ₹1 Lakh saves approximately ₹8.5 Lakhs in total interest and reduces your effective tenure by 3–4 years. The earlier you start prepaying, the more you save.
1. Save at least 20% as down payment to avoid higher interest rates and PMAY ineligibility. 2. Get pre-approved before property hunting — it strengthens your negotiating position. 3. Compare rates across at least 3–4 banks and NBFCs; even 0.25% matters over 20 years. 4. Factor in stamp duty, registration, GST (for under-construction), and interior costs — they add 8–12% to property cost. 5. Choose a shorter tenure if you can afford the higher EMI — the interest savings are massive. 6. Keep total EMI (all loans) below 40% of your net monthly income.
Under Indian tax law, home loan borrowers get three major deductions: (a) Section 80C — Principal repayment up to ₹1.5 Lakhs per year (shared with PPF, ELSS, etc.). (b) Section 24(b) — Interest paid up to ₹2 Lakhs per year for self-occupied property. For let-out property, the entire interest is deductible with no cap. (c) Section 80EEA — Additional ₹1.5 Lakhs interest deduction for first-time buyers (property value ≤ ₹45 Lakhs, loan sanctioned before March 2022). Joint home loans allow both co-borrowers to claim deductions independently, potentially doubling the tax benefit.
1. Stretching beyond affordability: EMI should not exceed 35–40% of take-home salary. 2. Ignoring total cost: A ₹60L loan at 8.5% for 20 years costs ₹65L in interest — more than the loan itself. 3. Not factoring ancillary costs: Stamp duty (5–7%), registration (1%), GST (5% for under-construction), legal fees, and interiors can add ₹5–15 Lakhs. 4. Choosing only floating rate without budgeting for rate hikes: A 1% increase on ₹60L adds ~₹4,000/month to your EMI. 5. Ignoring prepayment opportunity: Most floating-rate home loans have zero prepayment penalty — use bonuses and increments to prepay annually. 6. Not checking CIBIL score before applying: A score below 750 leads to rejection or higher rates.
For a ₹75L property with 20% down payment (₹15L), a ₹60L home loan at 8.5% for 20 years generates ₹65L in total interest — exceeding the loan amount itself. Reducing the rate to 8% saves ₹4.8L. An annual prepayment of ₹2L saves ₹17.2L and shortens tenure by ~5 years. Opting for a 15-year tenure instead of 20 saves ₹22.5L in interest but raises EMI by ₹9,700/month. The optimal strategy for most borrowers: maximize down payment, choose the shortest affordable tenure, and prepay ₹1–2L annually from bonuses.
Jump into prefilled calculator landings for common Indian amounts, tenures, and ages.