Loan Amortization Generator

Generate a complete month-by-month breakdown of principal and interest payments for any loan.

Loan Details

This calculator uses the standard reducing balance method used by most Indian banks for Business Loans, Home Loans, and Car Loans.

Monthly EMI

₹ 20,517

Total Interest

₹ 2,31,020

Total Payment

₹ 12,31,020

Month Beginning Balance Interest Paid Principal Paid Ending Balance

Understanding Loan Amortization

Amortization refers to the process of paying off a debt over time through regular scheduled payments. Each EMI consists of two components — a principal portion and an interest portion. In early months, the bulk goes toward interest. Over time, the split reverses as the outstanding balance reduces.

The schedule above shows every month's split. Use it to decide the best time for prepayment — paying extra in the first few years saves significantly more interest than prepaying later.

EMI Formula (Reducing Balance)
EMI = P × r × (1+r)^n / [(1+r)^n − 1]
  • P = Principal loan amount
  • r = Monthly interest rate (Annual % ÷ 12 ÷ 100)
  • n = Total months (Years × 12)

How Much Does Interest Really Cost?

Total interest paid as a % of loan amount at 8.5% p.a. — you pay far more than the loan itself for long tenures.

TenureMonthly EMI
(₹10L loan)		Total InterestInterest % of Loan
1 Year₹87,376₹48,5134.9%
3 Years₹31,569₹1,36,47013.6%
5 Years₹20,517₹2,31,02223.1%
10 Years₹12,400₹4,87,99648.8%
15 Years₹9,847₹7,72,46977.2%
20 Years₹8,678₹10,82,726108%

Typical Loan Rates in India (May 2025)

Loan TypeRate RangeTenureKey Feature
Home Loan8.40–9.50%Up to 30 yearsTax benefit on interest (Sec 24b) & principal (80C)
Car Loan8.70–12.00%1–7 yearsNo tax benefit; vehicle is collateral
Business Loan10.00–16.00%1–5 yearsInterest is business expense (tax deductible)
Personal Loan10.50–24.00%1–5 yearsUnsecured; no tax benefit
Education Loan8.00–15.00%Up to 15 yearsInterest deductible under Sec 80E for 8 years
Loan Against Property9.00–13.00%Up to 15 yearsLower rate; property is collateral
Prepayment Tip: For a ₹50L home loan at 9% for 20 years, paying just ₹5,000 extra every month reduces your tenure by ~5 years and saves ₹10+ lakh in interest. Always check if your bank charges a prepayment penalty (most floating-rate loans are penalty-free per RBI rules).

6 Things Your Amortization Schedule Reveals

Interest-Heavy First Half

In the first 50% of your loan tenure, you pay roughly 65–75% of the total interest. Prepayments in Year 1–3 have 3× the impact of the same amount prepaid in Year 8–10.

The Break-Even Point

The month where your principal component first exceeds your interest component is your amortization midpoint — typically around 60–65% through the loan tenure at standard rates.

Tenure vs Rate Tradeoff

Reducing your rate by 0.5% on a ₹50L 20-year loan saves ~₹3.8L. Reducing tenure by 5 years saves ~₹8L. Tenure reduction is almost always the better strategy.

Part-Prepayment ROI

Every ₹1 prepaid early in a loan at 9% effectively earns you 9% guaranteed, tax-equivalent return — better than most fixed deposits.

Balance for Loan Transfer

The outstanding balance column tells you exactly what you owe at any point — useful when considering a balance transfer to a lower-rate lender.

Tax Planning (Home Loans)

The interest column in each year helps you claim the correct deduction under Section 24(b) (up to ₹2L/year) when filing your ITR.

Frequently Asked Questions

An amortization schedule is a complete month-by-month table showing how each EMI is split between principal and interest, and the outstanding loan balance after every payment. It reveals your loan's true cost and helps you plan prepayments strategically.
It shows that interest is front-loaded — most of your early EMIs go toward interest, not principal. By identifying this, you can make targeted prepayments in the first few years to dramatically cut total interest. For a ₹50L loan at 9% for 20 years, paying ₹5,000 extra/month saves over ₹10 lakh and cuts 5 years off your tenure.
Interest each month = Outstanding Principal × Monthly Rate. In Month 1, the full principal is outstanding, so interest is maximum. As EMIs reduce the principal, subsequent interest charges fall and more of each EMI goes toward principal. This is the reducing balance method used by all Indian banks.
EMI = P × r × (1+r)^n / [(1+r)^n − 1], where P = principal, r = monthly interest rate (annual rate ÷ 12 ÷ 100), n = total months. Example: ₹10L loan at 8.5% for 5 years: r = 0.00708, n = 60, EMI = ₹20,517/month.
Yes, banks provide amortization schedules on request or via internet banking. Our calculator generates the same schedule instantly. It's especially useful for comparing schedules before finalising a loan, or when planning a balance transfer to a lower-rate lender.
Negative amortization occurs when your EMI is insufficient to even cover the monthly interest, so unpaid interest is added to the principal — increasing your outstanding balance over time. This can happen with some adjustable-rate mortgages during rate hike cycles. Standard Indian bank loans do not allow negative amortization.
Most banks offer both options when you prepay. Reducing tenure (keeping EMI same) saves significantly more interest — mathematically, every rupee of prepayment saves the most when applied toward reducing tenure. Reducing EMI keeps cash flow flexible but saves less total interest.
Per RBI guidelines, banks cannot charge prepayment penalties on floating-rate home and personal loans. For fixed-rate loans, a penalty of 1–4% may apply. Always verify with your lender before prepaying, especially on Business Loans where fixed-rate products are common.
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