Car Loan Calculator
Calculate your car loan EMI with down payment, trade-in value, and total cost of ownership analysis. Buying a car is one of the major investments one can make, and you may require a car loan to fund this substantial investment.
Car Loan Details
Car Loan Breakdown
Cost Breakdown
Payment Breakdown
Car Loan Tips
- Higher down payment reduces EMI and total interest
- Consider trade-in value to reduce loan amount
- Compare interest rates from multiple lenders
- Factor in insurance and maintenance costs
Car Loan EMI Calculator
Buying a car is one of the major investments one can make. You may require a car loan to fund this substantial investment. Often, a car loan's EMI is supposed to be repaid with due interest within a stipulated time to the lender.
On failure, your car may be taken away and put up for auction to recover the balance amount left to be paid. Thus, to calculate a precise EMI amount that you can afford to pay comfortably, you can use the Car Loan EMI Calculator.
Car loans typically have shorter tenures (3-7 years) compared to home loans, making them more affordable for most buyers. The vehicle serves as collateral, which helps in getting better interest rates.
Key Features of Car Loans
Secured Loan
Car loans are secured loans where the vehicle serves as collateral, typically resulting in lower interest rates.
Shorter Tenure
Car loans usually have shorter tenures (1-7 years) compared to home loans, making them more manageable.
Down Payment
Most lenders require a down payment of 10-20% of the car's value, which helps reduce the loan amount.
Quick Processing
Car loans typically have faster processing times compared to other secured loans due to standardized procedures.
Car Loan Planning Tips
Higher down payment reduces EMI and total interest burden significantly.
Consider trade-in value to reduce loan amount and monthly EMI.
Compare interest rates from multiple lenders including banks and NBFCs.
Factor in insurance, maintenance, and other ownership costs in your budget.
Car Loan EMI Formula - Detailed Calculation
Car loan EMI calculation includes additional factors like down payment, trade-in value, and insurance costs:
EMI = [P × R × (1+R)^N] / [(1+R)^N - 1]Car Loan Variables:
• P = Loan Amount (Car Price - Down Payment - Trade-in)
• R = Monthly Interest Rate
• N = Loan Tenure in Months
• Down Payment = 10-20% of car price
Additional Costs:
• Trade-in Value = Old car value
• Insurance = Annual premium × tenure
• Registration = One-time charges
• Processing Fee = 0.5-2% of loan
Car Loan Calculation Steps:
Step 1: Calculate loan amount = Car Price - Down Payment - Trade-in Value
Step 2: Convert annual rate to monthly (Rate ÷ 12 ÷ 100)
Step 3: Calculate tenure in months (Years × 12)
Step 4: Apply EMI formula to get monthly payment
Step 5: Add insurance and other costs to total cost
Example: ₹8 Lakh Car with 20% Down Payment:
Given:
• Car Price = ₹8,00,000
• Down Payment = ₹1,60,000 (20%)
• Trade-in Value = ₹0
• Loan Amount = ₹6,40,000
• Interest Rate = 9.5% p.a.
• Tenure = 5 years
Calculations:
• R = 9.5% ÷ 12 ÷ 100 = 0.00792
• N = 5 × 12 = 60 months
• EMI = ₹13,450
• Total Interest = ₹1,67,000
• Total Amount = ₹8,07,000
Result: The monthly EMI for the car loan is ₹13,450
Car Loan Specific Considerations:
LTV Ratio: Banks offer 80-90% of car value
Down Payment: Minimum 10-20% required
Trade-in: Reduces loan amount significantly
Insurance: Mandatory comprehensive insurance
Processing Fee: 0.5-2% of loan amount
Prepayment: Usually allowed with minimal charges
Total Cost of Ownership
When planning for a car loan, it's important to consider the total cost of ownership, which includes:
Car Price
The ex-showroom price of the vehicle
Interest Payments
Total interest paid over the loan tenure
Insurance
Annual insurance premiums for the loan duration
Registration & Taxes
One-time registration charges and road tax
Car Loan FAQs
Get answers to commonly asked questions about car loans, EMI calculations, and vehicle financing.