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Car Loan EMI Calculator

Calculate monthly EMI for your car loan and plan your purchase.

₹
%
months

Results

Monthly EMI₹16,607
Total Interest₹1.96 L
Total Payment₹9.96 L
Breakdown
Principal
₹8,00,000
Interest
₹1,96,401

Amortization schedule

YearPrincipalInterestBalance
Year 1₹1,32,662₹66,615₹6,67,336
Year 2₹1,45,111₹54,170₹5,22,227
Year 3₹1,58,722₹40,561₹3,63,506
Year 4₹1,73,609₹25,669₹1,89,896
Year 5₹1,89,896₹9,384₹0
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What is Car Loan EMI?

A Car Loan EMI Calculator helps you estimate the monthly installment for your dream car before you visit the dealership. Knowing your EMI in advance lets you set a realistic budget, choose the right car model, and negotiate better loan terms with banks.

Car loans in India are secured loans — the car itself acts as collateral, which is why interest rates (7-12%) are lower than unsecured personal loans (10.5-24%). Banks typically finance 80-90% of the car's on-road price (ex-showroom + registration + insurance + accessories). The remaining 10-20% is your down payment.

Current car loan interest rates in India (2025): SBI 8.65-9.80%, HDFC Bank 8.75-9.50%, ICICI Bank 8.75-9.55%, Bank of Baroda 8.50-10.40%, Kotak 8.99-10.99%, Axis Bank 8.99-9.75%. New cars get lower rates than used/pre-owned cars (typically 2-4% higher). Electric vehicles (EVs) often get preferential rates — SBI offers 0.20% concession for EVs.

The maximum car loan tenure is typically 7 years (84 months). A longer tenure reduces your monthly EMI but significantly increases total interest. For example, an ₹8 Lakh car loan at 9%: 3-year EMI is ₹25,434 (total interest ₹1.16L), 5-year EMI is ₹16,607 (total interest ₹1.96L), 7-year EMI is ₹12,848 (total interest ₹2.79L). The 7-year option costs you ₹1.63 Lakhs more in interest than the 3-year option.

Planning to compare with other loan types? Use our Home Loan EMI Calculator for housing, or Personal Loan EMI Calculator for unsecured loans. Want to estimate fuel costs for your new car? Try our Fuel Cost Calculator.

Formula

The car loan EMI formula is the same standard EMI formula:

EMI = P × r × (1 + r)^n / ((1 + r)^n − 1)

Worked Example — ₹10,00,000 car loan at 9% for 5 years: Step 1: r = 9 / 12 / 100 = 0.0075 Step 2: n = 5 × 12 = 60 months Step 3: EMI = 10,00,000 × 0.0075 × (1.0075)^60 / ((1.0075)^60 − 1) EMI = ₹20,758

Total Payment = ₹20,758 × 60 = ₹12,45,498 Total Interest = ₹12,45,498 − ₹10,00,000 = ₹2,45,498

Car loan EMI per ₹1 Lakh borrowed: - At 8.5% for 3 years: ₹3,155 - At 9.0% for 5 years: ₹2,076 - At 9.5% for 7 years: ₹1,634

Total cost of popular car models (with loan): - Maruti Swift ₹7L on-road, ₹5.6L loan at 9%/5yr: EMI ₹11,624, Total ₹6.97L - Hyundai Creta ₹14L on-road, ₹11.2L loan at 9%/5yr: EMI ₹23,249, Total ₹13.95L - Tata Nexon EV ₹16L on-road, ₹12.8L loan at 8.5%/5yr: EMI ₹26,167, Total ₹15.70L

How to use this Car Loan EMI Calculator?

1. Enter Car Loan Amount: This is the on-road price minus your down payment. Example: car costs ₹12 Lakhs on-road, you pay 20% down (₹2.4L), enter ₹9,60,000.

2. Set Interest Rate: Check your bank's car loan rate. Rates depend on: bank, car type (new/used), car brand, your CIBIL score, and whether you have a salary account with the bank.

3. Choose Tenure: 3-7 years (36-84 months). Shorter tenure = higher EMI but less total interest. Financial planners recommend 3-5 years for car loans since cars depreciate rapidly.

4. Check Affordability: Your car EMI should ideally be below 10-15% of your monthly take-home salary. If your salary is ₹60,000/month, keep car EMI under ₹9,000.

Pro tip: Always negotiate the interest rate. Banks often quote higher rates initially but can reduce by 0.25-0.50% if you have a good CIBIL score (750+) or a salary account with them.

Frequently asked questions

What is the ideal down payment for a car loan?
Banks require minimum 10-20% down payment. However, a 25-30% down payment is ideal because: (1) Lower EMI and total interest, (2) Lower insurance premium since IDV is based on loan amount, (3) You are less likely to be 'upside down' (owing more than the car's value) after depreciation.
Does car loan interest depend on the car type?
Yes. New cars: 7.5-10%. Used cars (under 5 years): 10-14%. Used cars (5-10 years): 12-16%. Electric vehicles: special rates 0.20-0.50% lower. Luxury cars may have different rates. Maruti, Hyundai, Tata get easier approvals due to better resale value.
Can I prepay my car loan without penalty?
For floating-rate car loans, RBI mandates zero prepayment penalty. For fixed-rate car loans, banks can charge 2-5% prepayment penalty. Most car loans today are floating rate. Even small prepayments of ₹20,000-50,000 annually can save significant interest.
New car vs used car loan — which is better?
New car loans have lower interest rates (7.5-10% vs 10-16% for used), longer tenure (7 years vs 5 years), and higher loan-to-value ratio (90% vs 75-85%). However, a 2-3 year old certified pre-owned car can save you 30-40% on the purchase price while still getting a decent loan.
What CIBIL score is needed for a car loan?
Most banks require minimum CIBIL score of 700 for car loans. Score 750+: best rates and instant approval. Score 700-749: approved with slightly higher rate. Score 650-699: may need higher down payment. Below 650: difficult to get approved from major banks.
Should I take a car loan or pay cash?
If you have the full amount, paying cash saves you ₹1-3 Lakhs in interest. However, a car loan makes sense if: (1) You can invest the cash at higher returns than the loan rate (e.g., 12% SIP vs 9% car loan), (2) You want to preserve liquidity for emergencies, (3) The manufacturer/dealer offers 0% or subsidized financing.
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