Buying a car is an exciting milestone for people, but only some can afford to pay the vehicle’s full price upfront. For the rest of us, car loans come to the rescue, with easy access to credit that enables us to buy our dream wheels.
However, a loan needs to be repaid, and before taking one, you need to understand its terms and devise a clear repayment plan. Part of that planning involves understanding how much you can afford to pay in monthly car loan EMIs.
That’s where Jiraaf’s Car Loan EMI Calculator tool steps in. The tool lets you instantly compute your monthly car loan EMI payments based on the loan amount, interest rate, and loan tenure you enter.
Whether you're purchasing a new or used car, this calculator can give you a quick, clear, and transparent view of your car loan's financial impact.
A Car Loan EMI Calculator is useful for anyone planning to finance a car purchase. Here is how Jiraaf's Car Loan EMI Calculator can assist you:
The Car Loan EMI Calculator considers four key factors to calculate the monthly EMI payment:
The EMI for a car loan is calculated using the below formula:
EMI = (P × r × (1 + r)n) / ((1 + r) n - 1)
Wherein,
For example, let us assume you want to buy a Toyota car worth ₹10,00,000 and plan to make a 20% down payment. You borrow the remaining 80% of the car's price, around ₹8,00,000, from a bank. Your annual interest rate is 10% for a loan tenure of 5 years (60 months).
First, we convert the annual interest rate to a monthly rate of 0.00833. Now, applying the formula:
EMI = (8,00,00 × 0.00833 × (1 + 0.00833)60) / ((1 + 0.00833)60 - 1)
Based on the above calculation, your estimated monthly EMI is ₹17,000. You'll need to pay ₹17,000 every month for the next 5 years to repay the loan.
The Car Loan EMI Calculator offers several key benefits.
The minimum downpayment required depends on the lender, but it is usually around 10% to 20% of the car's price.
Car loan tenures generally range from 1 year to 5 years. A longer tenure reduces your monthly EMI but increases the total interest paid to the lender. It is critical to know car loan interest payments do not have any tax saving benefits unlike home loans. The Car Loan EMI Calculator helps you adjust the tenure to find the right balance between affordability and total cost.
Yes, a higher downpayment will reduce the loan amount and your monthly EMI.
The EMI is calculated using the principal loan amount, the interest rate, and the loan tenure. Jiraaf's Car Loan EMI Calculator provides an easy-to-use interface to instantly calculate your monthly car loan EMI based on these parameters.
Missing an EMI or paying lower than what is owed to the lender can result in penalties, increased interest charges, and can affect your credit scores. To avoid this, borrow below the means based on one's income, and ensure timely payments.