Car loan planning
Car Loan EMI Calculator.
Estimate your monthly EMI for a new or used car loan, see the full repayment schedule, and check how a bigger down payment or shorter tenure changes your total interest cost.
- Principal amount
- ₹8,00,000
- Total interest
- ₹2,98,300
- Total amount
- ₹10,98,300
| Year | Principal | Interest | Balance |
|---|---|---|---|
| 1 | ₹84,519 | ₹72,381 | ₹7,15,483 |
| 2 | ₹92,905 | ₹63,995 | ₹6,22,578 |
| 3 | ₹1,02,126 | ₹54,774 | ₹5,20,452 |
| 4 | ₹1,12,262 | ₹44,638 | ₹4,08,190 |
| 5 | ₹1,23,400 | ₹33,500 | ₹2,84,787 |
| 6 | ₹1,35,650 | ₹21,250 | ₹1,49,136 |
| 7 | ₹1,49,113 | ₹7,787 | ₹22 |
New car vs. used car loan rates
New car loans typically carry rates of 8.5-10% since the vehicle is worth its full value as collateral at disbursal. Used car loans run higher — often 10-14% — because the car has already depreciated and resale value is less certain, which is also why used car loan tenure is usually capped shorter, at 5 years instead of 7.
Frequently asked questions
How is car loan EMI calculated?
Car loan EMI uses the standard reducing-balance formula: EMI = P × r × (1+r)^n / ((1+r)^n − 1). Most car loans run 3–7 years, and rates are usually 1–2% higher for used cars than new ones since resale value depreciates faster.
What is the maximum tenure for a car loan in India?
Most banks cap new-car loan tenure at 7 years and used-car loan tenure at 5 years. A longer tenure lowers your EMI but increases total interest paid — and by year 5–6 the car's resale value may fall below your outstanding loan balance.
Does my car loan interest rate depend on new vs. used car?
Yes. Used-car loans carry meaningfully higher rates (often 10–14%) than new-car loans (typically 8.5–10%), because used vehicles depreciate faster and carry more resale-value uncertainty for the lender.
Can I prepay or foreclose my car loan early?
Most lenders allow prepayment after a lock-in period (commonly 6–12 months), but unlike home loans, car loan prepayment charges are not banned by RBI for all borrower types — check your loan agreement, as NBFC car loans in particular often carry a 2–5% foreclosure charge on the outstanding principal.
Does a higher down payment reduce my car loan interest rate?
A larger down payment lowers your loan-to-value ratio, which can help you qualify for a better rate band and reduces your total interest paid simply because you're borrowing less — even at the same rate.