Loan Prepayment Calculator: Reduce EMI or Tenure
See two simple ways a lump-sum prepayment can help: lower your monthly EMI or keep the EMI similar and finish the loan sooner.
What can your prepayment do?
Your EMI today—
More room each month
Option 1: Lower your EMI
—
New monthly EMI; the remaining tenure stays the same.
- Monthly relief
- —
- Interest saved
- —
Usually saves more
Option 2: Finish sooner
—
Estimated time left; keep paying roughly your current EMI.
- Time saved
- —
- Interest saved
- —
Both options assume the prepayment is applied to principal and the interest rate does not change.
Which option should you choose?
Choose a lower EMI when…
- You need more room in your monthly budget.
- Your income is uncertain or your expenses have increased.
- Reducing financial pressure matters more than maximum interest savings.
Choose a shorter tenure when…
- Your current EMI is still comfortable.
- You want to become debt-free earlier.
- Your priority is usually the larger interest saving.
RBI rules on prepayment charges
For eligible floating-rate loans, RBI rules restrict lenders from charging foreclosure or prepayment penalties. The current 2025 Directions apply to loans and advances sanctioned or renewed on or after 1 January 2026. Coverage depends on the rate type, loan purpose, borrower and lender category.
A fixed-rate loan or a loan outside the covered categories may still carry charges under the lender’s disclosed policy. Confirm the applicable terms before prepaying.