Loan Comparison Calculator
Compare the EMI, total interest and total payment of two loans side by side.
Difference in total interest
Loan B costs ₹76,567 less in total interest.
Side by side
| Loan A | Loan B | |
|---|---|---|
| Monthly EMI | ₹8,997 | ₹8,678 |
| Tenure | 20 years | 20 years |
| Total interest | ₹11,59,342 | ₹10,82,776 |
| Total payment | ₹21,59,342 | ₹20,82,776 |
Principal and interest only, at fixed rates. Fees and charges are not included.
How it works
Each loan's EMI uses the reducing-balance formula:
EMI = P × r × (1 + r)n ÷ ((1 + r)n − 1)
- P = loan amount, r = yearly rate ÷ 12 ÷ 100, n = tenure in months
Total payment = EMI × n · Total interest = Total payment − P
The loan with the lower total interest is shown as cheaper. At 0% interest, EMI = P ÷ n.
Worked example
Loan A: ₹5,00,000 at 12% for 5 years. Loan B: the same amount at 10.5% for7 years.
- Loan A EMI = ₹11,122.22; total interest = ₹11,122.22 × 60 − ₹5,00,000 = ₹1,67,333
- Loan B EMI = ₹8,430.34; total interest = ₹8,430.34 × 84 − ₹5,00,000 = ₹2,08,148
- Loan B's EMI is ₹2,692 lower each month, but it costs ₹40,815 more in interest because it runs 2 years longer, even at the lower rate of 10.5%.
Frequently asked questions
What does this loan comparison calculator do?
It puts two loan offers side by side and shows the EMI, total interest and total payment for each, so you can see which costs less overall and which is easier on your monthly budget.
Which loan is cheaper: lower EMI or lower interest?
They are not the same thing. A longer tenure lowers the EMI but usually increases the total interest, even at a lower rate. In the worked example below, the 7-year loan has a lower rate and a lower EMI but costs more interest overall.
How is the EMI calculated?
Both loans use the standard reducing-balance formula: EMI = P × r × (1 + r)^n ÷ ((1 + r)^n − 1), where r is the monthly rate and n the number of months. It is the same formula as our EMI calculator.
Does this include processing fees and other charges?
No. It compares only principal and interest. Fees, insurance and other charges can change which loan is cheaper. Each lender's Key Facts Statement lists all charges and the Annual Percentage Rate (APR), which is the better number for comparing total cost.
Can I compare loans of different amounts?
Yes. Enter any amount, rate and tenure for each loan. If the amounts differ, compare the total payment and the EMI rather than the interest alone.
What about floating interest rates?
This calculator assumes each rate stays the same for the whole tenure. A floating rate can change, which changes the EMI, the tenure or both. Re-run the comparison with different rates to see the range of outcomes.
Should I always choose the loan with less interest?
Not always. A lower EMI can matter if your budget is tight, and features such as prepayment terms or charges also matter. Use the numbers here together with the lenders' terms to decide.