Loan Prepayment Calculator Save Interest & Time
Check how prepaying loan reduces total interest
Calculate potential savings by making prepayments on your home loan, car loan, or personal loan. See how much interest you can save and how much earlier you can become debt-free.
Prepayment Calculator
Original loan amount
Annual interest rate on your loan
Amount you plan to prepay
When to start prepaying (typically after 12 months)
Understanding Loan Prepayment
What is Loan Prepayment?
Loan prepayment is making additional payments towards your loan principal beyond your regular EMI. This reduces the outstanding balance and can significantly reduce your interest burden and loan tenure.
Types of Prepayment
- • Partial Prepayment: Pay extra amount periodically
- • Full Prepayment: Pay off entire remaining balance
- • Yearly Prepayment: Make extra payments annually
- • One-time Prepayment: Make a lump sum payment once
Benefits of Prepayment
- • Interest Savings: Significantly reduce total interest paid
- • Faster Debt Freedom: Pay off loan earlier than planned
- • Financial Flexibility: Free up future income sooner
- • Better Credit: Improves creditworthiness
- • Peace of Mind: Less financial stress over time
Why Use Our Loan Prepayment Calculator?
Maximum Interest Savings
See exactly how much interest you can save by making prepayments. Every rupee prepaid today saves multiple rupees in interest tomorrow.
Reduce Loan Tenure
Calculate how much faster you can pay off your loan with prepayments. Become debt-free years earlier than planned.
Compare Scenarios
Compare loan repayment with and without prepayments. Visualize your savings with detailed charts and breakdowns.
How to Use the Prepayment Calculator
Enter Loan Details
Input your current loan amount, interest rate, and tenure. This forms the baseline for comparison.
Set Prepayment Amount
Enter the amount you plan to prepay and choose whether it's a one-time payment or yearly prepayments. Also specify when you want to start prepaying.
View Your Savings
Get instant results showing your interest savings, reduced tenure, and detailed comparison charts. Make informed decisions about prepayments.
Frequently Asked Questions
What is loan prepayment?
Loan prepayment is paying more than your regular EMI amount towards your loan. This extra payment goes directly towards reducing your principal amount, which in turn reduces the total interest you'll pay over the loan tenure.
How does prepayment save interest?
Interest is calculated on the outstanding principal amount. When you prepay, you reduce the principal, which means less interest is charged on the remaining balance. This creates a compounding effect where you save on both current and future interest charges.
Are there prepayment charges?
Most banks don't charge prepayment penalties on floating rate home loans. However, some banks may charge 2-3% on fixed rate loans. For personal loans and car loans, prepayment charges vary. Always check with your lender before making prepayments.
When should I prepay my loan?
The earlier you prepay, the more interest you save. However, make sure you maintain an emergency fund and don't compromise on essential investments. Prepay when you have surplus funds like bonuses, inheritances, or matured investments.
Should I reduce EMI or tenure?
Reducing tenure saves more interest in the long run. Reducing EMI provides immediate cash flow relief. Our calculator shows tenure reduction, which is generally more beneficial. Most experts recommend reducing tenure to save maximum interest.
Can I prepay any loan?
Yes, you can prepay home loans, car loans, personal loans, and education loans. Check your loan agreement for any prepayment clauses or charges. Home loans typically have the most favorable prepayment terms.
Ready to Save on Your Loan?
Calculate your prepayment savings now and become debt-free faster
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