Car EMI Calculator

Formula to Calculate EMI

The formula to calculate the EMI on a car loan is: $EMI = \frac{P \times r \times (1+r)^n}{(1+r)^n-1}$

Where:

• $P$ is the principal amount (the original loan amount),
• $r$ is the monthly interest rate (annual rate divided by 12),
• $n$ is the number of months (loan term in years multiplied by 12).

Example

Let's calculate a car loan EMI for the following:

• Principal amount ( $P$ ) = ₹500,000
• Annual interest rate = 10%
• Loan term = 5 years

First, convert the annual interest rate to a monthly rate:

• Monthly interest rate ( $r$ ) = 10% / 12 = 0.8333% = 0.008333 (as a decimal)

Then, calculate $n$ , the total number of payments:

• $n$ = 5 years $\times$ 12 months/year = 60 months

Plug the values into the EMI formula: $EMI = \frac{500,000 \times 0.008333 \times (1+0.008333)^{60}}{(1+0.008333)^{60}-1}$

$EMI ≈ ₹10,747$

Alternatively, you can use an online car loan EMI calculator, which provides a quick and convenient way to calculate the EMI. Simply input the principal amount, interest rate, and loan tenure, and the calculator will compute the EMI for you. These calculators are available on financial services websites, bank websites, and as apps.