What is EMI?▼
EMI stands for Equated Monthly Installment. It's a fixed payment amount made by a borrower to a lender at a specified date each calendar month. EMI is used to pay off both interest and principal each month.
How is EMI calculated?▼
EMI is calculated using the formula: EMI = P × r × (1+r)^n / ((1+r)^n - 1), where P is the loan amount, r is the monthly interest rate, and n is the number of monthly installments.
What happens if I prepay my loan?▼
Prepaying your loan reduces the outstanding principal, which can reduce your total interest payment. However, some banks charge prepayment penalties. Check with your lender before making prepayments.
What is a good interest rate for home loans in India?▼
Home loan interest rates in India typically range from 8% to 10% per annum. Rates vary based on the lender, your credit score, employment type, and loan amount. Floating rates are common and can change with market conditions.