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Loan Prepayment Calculator

See how much interest you save by making lump-sum prepayment on your loan

💰Loan & Prepayment Details

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₹

Lump-sum amount you'll prepay

🎉Your Savings

Total Interest Saved
₹6,28,500
Current EMI₹24,621
Prepayment Amount₹5,00,000
Tenure Reduced By3 years 2 months
New Tenure11 years 10 months
Without Prepayment₹44,31,780
With Prepayment₹38,03,280

Frequently Asked Questions

When is best time to prepay loan? +
EARLIER is BETTER. Prepayment in first 5 years of a 20-year loan saves the most interest (60-70% of EMI is interest in early years). After year 10, principal portion is higher, so prepayment savings reduce. ALWAYS prepay the principal, not future EMIs.
Reduce EMI vs reduce tenure? +
Reducing TENURE saves more interest (recommended). Reducing EMI gives short-term cash flow relief but you pay more interest overall. Example: ₹5L prepayment on 20-year ₹25L loan: Tenure reduction saves ₹6.3L interest. EMI reduction saves only ₹3.2L.
Are there prepayment charges? +
Home Loans (Floating): NIL prepayment charge (RBI rule since 2012). Home Loans (Fixed): 2-3% charge. Personal Loans: 2-5% + GST. Car Loans: 5-6% in early years, NIL after 12-24 EMIs. Always check your loan agreement.
Prepay loan or invest? +
If your loan rate is HIGHER than potential investment returns, prepay. Home loan @8.5% (after tax benefit ~6%) vs Mutual Fund @12% — investing wins. Personal loan @14% — prepayment wins easily. Calculate post-tax returns for fair comparison.
Tax impact of prepayment? +
Home loan prepayment reduces your interest deduction (Section 24b limit ₹2L) and principal deduction (Section 80C limit ₹1.5L). If you're already getting full tax benefits, prepayment slightly increases your tax. But interest saved is much more than tax loss.
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Important Financial Disclaimer

This calculator is for informational purposes only. Results are estimates and should NOT be considered as financial advice.

  • 💼 Consult your bank or financial advisor before any loan decision.
  • 📊 Bank rates shown are indicative. Your actual rate depends on credit score, income, employment.
  • 📋 Calculations may not include processing fees, GST, prepayment charges, late fees, insurance.
  • ⚖️ Loan eligibility criteria vary across banks. Check official website for current terms.
  • 🔄 Interest rates change frequently based on RBI repo rate. Verify before applying.

By using this calculator, you agree that KaamKaTool.in is not liable for any financial decisions or losses based on this information.