The decision
Build your plan on the left. Watch it pay off on the right.
No Calculate button — every number updates as you type, and each figure traces back to a row in your schedule.
Your loan
What you owe today
Your prepayments
Lump sums or top-ups
Choose the outcome
Shorter loan or lower EMI
Results, live
No Calculate button
Your loan
What you owe today
Computed from the numbers above.
Your prepayment plan
1 active · ₹5.00 L prepaid over the loan
on 05 Apr 27
On its own: saves ₹15.50 L and 4y 5m off your loan.
What should prepaying do?
The single most important choice here
Advanced optionsPayment frequency, rate changes, fees — optional
Payment mechanics
Interest rate changes
The EMI is recomputed over the tenure remaining — tenure held, EMI moves. Check your bank's reset letter: on a floating-rate home loan many Indian lenders do the opposite.
Tax relief
Fees & charges
Usually zero — RBI bars these on floating-rate loans to individuals. Include any GST your lender adds.
Net benefit after fees
₹15.50 L
No fees entered, so the whole saving is yours.
Where you stand after
Side by side
Your loan with your plan, and without it
Two futures for the same loan. The right-hand column is the one you're building.
Interest you keep
₹15.50 L
33% less interest than doing nothing
Time you get back
4y 5m
earlier than Sep 2046
Every figure here is the last row of the matching schedule below — nothing is estimated separately.
Visual proof
Your balance reaches zero 4y 5m sooner
The shaded gap is what you no longer owe. At its widest it is ₹17.04 L.
Where each year's instalments go
Interest outweighs principal until 2034 — which is why a prepayment made before then removes the most.
What waiting costs you
What ₹5.00 L removes from your interest bill, by the date you pay it.
Paid now it removes ₹16.22 L. Wait twelve months and it removes ₹14.81 L — ₹1.40 L less for the same money.
Full detail
Every payment, to the rupee
187 payments across 17 years, every rupee accounted for
17 years match
| # | Date | Opening | EMI | Interest | Principal | Prepayment | Closing |
|---|---|---|---|---|---|---|---|
| ₹45,00,000 | ₹1,15,029 | ₹92,659 | ₹22,369 | — | ₹44,77,631 | ||
| ₹44,77,631 | ₹9,60,115 | ₹3,37,724 | ₹6,22,392 | ₹5,00,000 | ₹38,55,239 | ||
| ₹38,55,239 | ₹4,60,115 | ₹3,12,561 | ₹1,47,555 | — | ₹37,07,684 | ||
| ₹37,07,684 | ₹4,60,115 | ₹2,99,916 | ₹1,60,199 | — | ₹35,47,485 | ||
| ₹35,47,485 | ₹4,60,115 | ₹2,86,189 | ₹1,73,927 | — | ₹33,73,558 | ||
| ₹33,73,558 | ₹4,60,115 | ₹2,71,284 | ₹1,88,831 | — | ₹31,84,727 | ||
| ₹31,84,727 | ₹4,60,115 | ₹2,55,103 | ₹2,05,012 | — | ₹29,79,715 | ||
| ₹29,79,715 | ₹4,60,115 | ₹2,37,535 | ₹2,22,580 | — | ₹27,57,135 | ||
| ₹27,57,135 | ₹4,60,115 | ₹2,18,462 | ₹2,41,654 | — | ₹25,15,481 | ||
| ₹25,15,481 | ₹4,60,115 | ₹1,97,754 | ₹2,62,362 | — | ₹22,53,119 | ||
| ₹22,53,119 | ₹4,60,115 | ₹1,75,272 | ₹2,84,844 | — | ₹19,68,275 | ||
| ₹19,68,275 | ₹4,60,115 | ₹1,50,863 | ₹3,09,253 | — | ₹16,59,023 | ||
| ₹16,59,023 | ₹4,60,115 | ₹1,24,362 | ₹3,35,753 | — | ₹13,23,269 | ||
| ₹13,23,269 | ₹4,60,115 | ₹95,591 | ₹3,64,525 | — | ₹9,58,745 | ||
| ₹9,58,745 | ₹4,60,115 | ₹64,354 | ₹3,95,762 | — | ₹5,62,983 | ||
| ₹5,62,983 | ₹4,60,115 | ₹30,440 | ₹4,29,675 | — | ₹1,33,308 | ||
| ₹1,33,308 | ₹1,35,423 | ₹2,115 | ₹1,33,308 | — | ₹0 | ||
Compare strategies
Same money, very different outcomes
Ranked by interest saved against your loan. Tap one to make it your plan.
One bonus a year
₹10,000 every December
Interest saved
₹20.55 L
- Time saved
- 7y 9m
- Extra paid
- ₹15.11 L
- Debt-free
- Dec 2038
- Saved per ₹1
- ₹1
A little every month
₹10,000 on top of every EMI
Interest saved
₹19.94 L
- Time saved
- 7y 6m
- Extra paid
- ₹14.90 L
- Debt-free
- Mar 2039
- Saved per ₹1
- ₹1
Lump sum, straight away
₹4.50 L at your next payment date
Interest saved
₹14.92 L
- Time saved
- 4y 2m
- Extra paid
- ₹4.50 L
- Debt-free
- Jul 2042
- Saved per ₹1
- ₹3
The same lump sum, a year later
₹4.50 L after twelve more payments
Interest saved
₹13.61 L
- Time saved
- 3y 11m
- Extra paid
- ₹4.50 L
- Debt-free
- Oct 2042
- Saved per ₹1
- ₹3
How we calculate
No black box. Six rules produce every number here.
The same six a lender applies to your account each month. Read them, check them against your statement, then trust the schedule.
Interest accrues on your opening balance each period. On the default settings — monthly payments, monthly compounding — that is your annual rate divided by twelve, which is standard reducing balance. Change the payment frequency and the rate is converted so your effective annual rate stays the same.
A prepayment goes entirely to principal. Nothing is applied to interest, which is why the next period costs you less.
No period ever pays more than the balance plus its interest, so the loan settles at exactly zero and can never go negative.
On a rate change the EMI is recomputed over the tenure remaining — tenure held, EMI moves.
Both futures are run through the same engine on the same rate path, so the comparison is fair.
Every headline figure is the last row of its schedule. Nothing on this page is estimated a second way.
Questions people ask
Should I reduce my tenure or my EMI?
Reduce the tenure, unless the monthly difference has a specific higher-value job to do — clearing higher-rate debt, building an emergency fund you do not have, or absorbing a variable income. Shortening the loan removes periods that carried interest; lowering the EMI keeps every one of them. Both are costed above on your own numbers, so you do not have to take the general rule on trust.
Can I switch from EMI reduction to tenure reduction later?
Usually yes, but it is a separate written request to your lender and some charge a conversion or administrative fee for reworking the schedule. It is far easier to give the right instruction the first time, which is what this page is for.
What if my lender only offers EMI reduction?
Then take it and keep paying your original instalment as a recurring prepayment. The outcome is close to tenure reduction and nothing prevents you from doing it. Model it here by choosing "Lower my EMI" and adding a monthly top-up equal to the difference.
What should I enter as the outstanding balance?
What you still owe today, from your latest statement — not the amount you originally borrowed. This is the single most common mistake, and it changes every number on the page.
Will my bank charge me to prepay?
On a floating-rate home loan to an individual, almost certainly not. Longstanding RBI guidance already barred foreclosure and prepayment charges on floating-rate home loans to individual borrowers, and the Reserve Bank of India (Pre-payment Charges on Loans) Directions, 2025 widened that for loans sanctioned or renewed on or after 1 January 2026 — for individuals borrowing for purposes other than business, irrespective of the source of the funds, with or without a co-obligant, and with no minimum lock-in. Fixed-rate loans are treated differently and may still carry a charge, calculated on the amount you prepay. Check your sanction letter and your lender's current schedule of charges, then enter anything that applies — including any GST the lender adds to it — under Advanced options, and the net benefit updates. Verified against the 2025 Directions on 10 September 2026.
Why does my bank's number differ slightly?
This calculator uses the standard monthly reducing balance — interest at your annual rate divided by twelve, on the balance at the start of each month — and a prepayment takes effect from your next scheduled payment. Some lenders compute interest on a daily reducing balance with monthly rests, and credit a prepayment on the day you make it. Either way you will save a little more than shown, and the difference is small: at most about one month of interest on the amount prepaid.
Where does my data go?
Nowhere. Every calculation runs in your browser. There is no account, no tracking of your loan values, and no server round-trip to compute any of this.
Why you can check this one
Independent
Not a lender, not a broker, not affiliated with anyone who is. Nothing here is ranked by what it pays us, because nothing pays us. There are no ads and no lead generation.
Checkable
Every figure is the last row of a schedule you can expand, read and download. The rules the engine follows — the rate conversion, the rounding points, how a prepayment is timed — are published in full, along with every place we knowingly differ from a lender.
Honest about limits
It models the loan, not your life. It does not know your lender's exact day-count conventions, your emergency fund or your tax position — and it will tell you when prepayment costs more than it saves rather than showing you a zero.
Nothing you type is sent anywhere. No account, no tracking of your loan details, nothing stored on a server. How that works.
Read the full methodology — the exact rate conversion, where rounding is applied, how we time a prepayment, and every choice we make differently from a lender, with the reasoning for each.
In plain terms
Why tenure reduction usually wins — and when it does not
Shortening the loan saves more interest in almost every case. That does not automatically make it the right answer.
Interest is charged on the balance outstanding, for as long as there is a balance. Reducing the tenure keeps your EMI working at full strength and removes periods from the end of the loan — the periods that exist only because the debt lasted that long. Reducing the EMI keeps every one of those periods and simply makes each payment smaller. The first eliminates interest; the second redistributes it. On a typical Indian home loan the gap between the two is not marginal — it is often the difference between saving a few lakh and saving tens of lakh, and this page computes both on your own figures rather than quoting a representative case.
The case for reducing the EMI is a cash-flow case, and it is a real one. A lower monthly commitment is genuine protection if your income is variable, if you are servicing other debt at a higher rate, or if you have no emergency fund and prepaying would leave you exposed. Freed-up monthly cash that clears a credit card at 36% is worth more than interest saved on a home loan at 8%. So the honest rule is not "always shorten the tenure" — it is "shorten the tenure unless you have a specific, higher-value use for the monthly difference."
There is a third option most people miss, and it is usually the best of the three: take the lower EMI and keep paying the old one. Some lenders will not let you nominate tenure reduction, but nobody can stop you from paying more than the instalment. Set the strategy to "Finish sooner" and switch on the annual step-up under the plan to model what happens when your instalment grows with your salary instead of standing still for twenty years.
- Finish sooner
- EMI unchanged; periods removed from the end of the loan. Maximum interest saved.
- Lower my EMI
- Tenure unchanged; the instalment is recalculated after each prepayment. Maximum monthly relief.
- The default
- Many lenders apply EMI reduction unless you instruct otherwise. Ask in writing.
How it's calculated
The working behind the number
This calculator applies the same prepayments to your loan two ways and costs both. Finish sooner keeps the EMI unchanged, so each prepayment removes payments from the end of the loan. Lower my EMI recalculates the instalment after each prepayment over the tenure the loan still has, so the end date stays and the EMI falls. Each is compared with making no prepayment at all, on the same rate path.
Formula
Finish sooner: EMI unchanged, and the loan ends when the balance reaches 0 · Lower my EMI: after a prepayment, EMI = B × r × (1 + r)ᵐ ÷ ((1 + r)ᵐ − 1)
- B
- The balance straight after the prepayment.
- r
- The monthly rate: your annual rate ÷ 12.
- m
- The payments still left in the tenure.
- EMI
- The monthly instalment, rounded to the paisa.
Assumptions and limits
- Interest is charged monthly on the reducing balance, at the annual rate ÷ 12.
- Under Lower my EMI the instalment is recalculated only after a payment that carries a prepayment, over the payments the loan has left.
- Whichever you choose, money paid early starts counting at the first EMI date on or after the day it is paid.
- The annual step-up applies only under Finish sooner: raising an EMI you have asked to lower would contradict the instruction.
- Figures are rounded to the paisa every month, and charges are paid out of pocket, never added to the balance.
A worked example
Take ₹45,00,000 outstanding at 8.25% a year, with 20 years (240 monthly payments) of tenure left, and pay ₹5.00 L into it ahead of schedule. A lender can do two things with that money.
- Keep the EMI and shorten the tenure: the loan ends in Apr 2042, saving ₹15.50 L.
- Keep the tenure and lower the EMI: it falls as low as ₹34,032, saving ₹5.04 L.
Shortening the tenure saves ₹10.46 L more on the same money.
Computed by the calculator on this page, from the figures it opens with.
Sources
- RBI, Reset of Floating Interest Rate on EMI-based Personal Loans (RBI/2023-24/55, 18 August 2023): at a reset, the option of a higher EMI, a longer tenor or both, and to prepay; a longer tenor must not cause negative amortisation — checked 10 September 2026
- RBI (Pre-payment Charges on Loans) Directions, 2025 (RBI/2025-26/64, 2 July 2025): no pre-payment charge on floating-rate loans to individuals for non-business purposes sanctioned or renewed on or after 1 January 2026; fixed-rate charges are computed on the amount prepaid — checked 10 September 2026
By The CutYears team · Last reviewed 10 September 2026 · Full methodology