Is it better to reduce EMI or tenure after prepayment?

Reducing tenure saves significantly more interest compared to reducing EMI. If you can manage your current EMI comfortably, always choose to reduce tenure. Reducing EMI only helps if you need monthly cash flow relief.

When is the best time to make a home loan prepayment?

The earlier in your loan tenure you prepay, the more interest you save. In the initial years, a large portion of your EMI goes toward interest. Prepaying in the first 5 years can save 2-3x the prepaid amount in total interest.

Do banks charge a prepayment penalty?

As per RBI guidelines, banks cannot charge prepayment penalties on floating-rate home loans for individual borrowers. However, fixed-rate loans may have a penalty of 1-3% of the prepaid amount. Always check your loan agreement.

What is the minimum prepayment amount?

Most banks require a minimum prepayment of 3-6 months EMI equivalent. For example, if your EMI is ₹35,000, the minimum prepayment may be ₹1-2 lakhs. Some banks accept any amount above one EMI.

How does part-payment differ from foreclosure?

Part-payment (prepayment) means paying a lump sum to reduce the outstanding principal while the loan continues. Foreclosure means paying off the entire remaining balance to close the loan completely. This calculator handles part-payment scenarios.

Home Loan Prepayment Calculator

Find out interest saved and tenure reduced by making a home loan prepayment.

Loan Details

Original Loan Amount₹50,00,000

₹5L₹2Cr

Interest Rate (% p.a.)

Original Tenure (Years)

Prepayment Amount

Prepay at Month #

After Prepayment, I want to:

Total Interest Saved

₹14,52,602

By prepaying ₹5,00,000

Loan Closed Earlier By

3y 9m

New closure: 16yr 3mo from start

Before vs After Comparison

Parameter	Without Prepayment	With Prepayment
Monthly EMI	₹43,391	₹43,391
Outstanding at Month 24	₹47,92,181	₹42,92,181
Total Interest Paid	₹54,13,879	₹39,61,277
Interest Saved	—	₹14,52,602

Home Loan Prepayment Calculator का उपयोग कैसे करें

1
Enter your original home loan amount and the annual interest rate.
2
Select your original loan tenure (total years of the loan).
3
Enter the lump sum prepayment amount you plan to make.
4
Enter the month number when you plan to make the prepayment (e.g., month 24 = after 2 years).
5
Choose whether you want to reduce your EMI or reduce your tenure after prepayment.
6
View the total interest saved, new tenure or new EMI, and years cut from your loan.

Home Loan Prepayment Calculator के बारे में

Thinking about making a lump sum prepayment on your home loan? Our Home Loan Prepayment Calculator shows you exactly how much interest you can save and how many years you can cut from your loan tenure — instantly and for free.

How Prepayment Saves You Money

When you make a part-payment on your home loan, the entire amount goes directly toward reducing your outstanding principal. Since interest is calculated on the remaining balance, even a modest prepayment in the early years of your loan can save you lakhs in total interest. For example, prepaying ₹5 lakh on a ₹50 lakh loan at 8.5% in the second year can save over ₹10 lakh in interest.

Two Strategies After Prepayment

Reduce Tenure: Keep the same EMI but close your loan years earlier — this saves the most interest overall.
Reduce EMI: Keep the same tenure but enjoy a lower monthly payment — helpful if you need cash flow relief.

Key Features

Side-by-side comparison of before vs after prepayment scenarios
Total interest saved, new tenure, and new EMI calculated instantly
Works for any loan amount, rate, and prepayment timing
No data sent to any server — 100% browser-based and private

As per RBI guidelines, banks cannot charge prepayment penalties on floating-rate home loans for individual borrowers. Use this calculator to plan your prepayment strategy and become debt-free sooner.