Car Loan Calculator – Auto Finance EMI Planner
Plan your vehicle purchase with our comprehensive car loan calculator.
Car Price
₹1,000,000
Down Payment
₹200,000 (20.0%)
Loan Amount
₹800,000
Monthly EMI
₹16,801
What is a Car Loan Calculator?
A car loan calculator is a specialized financial tool designed to help potential vehicle buyers estimate the financial implications of their auto loan. It provides a clear picture of monthly repayment obligations, total interest costs, and the overall financial commitment involved in purchasing a vehicle through financing.
Unlike a standard EMI calculator, a car loan calculator typically includes additional features specific to vehicle financing, such as down payment calculations, car price considerations, and depreciation analysis. This helps buyers understand how different down payment amounts affect their monthly EMIs and total interest costs.
The calculator uses compound interest principles to project your repayment schedule over the entire loan tenure, helping you make informed decisions about vehicle affordability, loan tenure, and down payment amounts. It's an essential tool for anyone planning to purchase a vehicle using auto financing.
How to Use This Calculator
- Enter the car price - This is the total on-road price of the vehicle you wish to purchase.
- Specify your down payment amount - Enter how much you plan to pay upfront. This is typically 10-20% of the car's value.
- Input the interest rate - Enter the annual interest rate offered by your lender (in percentage).
- Select the loan tenure - Choose how many years you plan to take for repaying the car loan.
- Review the results - The calculator will show your loan amount, monthly EMI, total interest payable, and repayment schedule.
Calculation Formula & Example
The Formula
EMI = [P × r × (1 + r)^n] ÷ [(1 + r)^n - 1]
Where:
- EMI = Equated Monthly Installment
- P = Principal loan amount (Car Price - Down Payment)
- r = Monthly interest rate (Annual rate ÷ 12 ÷ 100)
- n = Loan tenure in months
Example Calculation
Let's calculate the EMI for a car loan with the following parameters:
- Car price: ₹10,00,000
- Down payment: ₹2,00,000 (20%)
- Loan amount: ₹8,00,000
- Annual interest rate: 9.5%
- Loan tenure: 5 years (60 months)
Step 1: Calculate the monthly interest rate (r)
r = 9.5% ÷ 12 ÷ 100 = 0.00792
Step 2: Apply the formula
EMI = [8,00,000 × 0.00792 × (1 + 0.00792)^60] ÷ [(1 + 0.00792)^60 - 1]
EMI = [8,00,000 × 0.00792 × 1.606] ÷ [1.606 - 1]
EMI = 10,188 ÷ 0.606
EMI = ₹16,811
Result:
- Monthly EMI: ₹16,811
- Total amount paid: ₹10,08,660 (₹16,811 × 60 months)
- Total interest paid: ₹2,08,660 (₹10,08,660 - ₹8,00,000)
Benefits of Using This Calculator
- Affordability Assessment - Determine how much car you can afford based on your budget for monthly EMIs.
- Down Payment Planning - See how different down payment amounts affect your EMI and total interest costs.
- Compare Loan Options - Evaluate different interest rates and tenures to find the most suitable car loan for your needs.
- Budget Planning - Plan your monthly budget by knowing exactly how much you need to set aside for your car loan EMI.
- Interest Savings Analysis - Understand how making prepayments or choosing a shorter tenure can save interest costs.
- Total Cost Visualization - See the true cost of your car purchase including the interest paid over the loan period.
Calculator Use Cases
Understand the financial implications of your first car purchase. Calculate how much vehicle you can afford based on your savings for down payment and capacity for monthly EMIs.
Plan your move to a better car by calculating the EMI for the new vehicle while considering the sale proceeds from your current car as down payment.
Compare the financial implications of buying a new car versus a used car by analyzing the different loan amounts, interest rates, and depreciation factors.
Compare your current car loan terms with refinancing options to determine if switching to a lower interest rate would result in significant savings.
Frequently Asked Questions
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