What is EMI?
EMI (Equated Monthly Installment) is the fixed monthly payment you make to the lender until your loan is fully repaid. EMI includes two parts:
- Principal Amount – The actual loan amount you borrowed.
- Interest – The cost charged by the lender on the borrowed amount.
The formula used to calculate EMI is: EMI=P×R×(1+R)N(1+R)N−1EMI = \frac{P \times R \times (1+R)^N}{(1+R)^N – 1}EMI=(1+R)N−1P×R×(1+R)N
Where:
- P = Loan amount (₹35,00,000)
- R = Monthly interest rate (annual interest rate ÷ 12 ÷ 100)
- N = Total number of months (6 years = 72 months)
EMI for ₹35 Lakh Loan for 6 Years
The exact EMI depends on the interest rate offered by the lender. Let’s look at approximate EMI values:
| Interest Rate (per annum) | EMI (per month) | Total Payment (6 Years) | Total Interest Paid |
|---|---|---|---|
| 9% | ₹62,734 | ₹45,16,848 | ₹10,16,848 |
| 11% | ₹67,633 | ₹48,69,576 | ₹13,69,576 |
| 13% | ₹72,680 | ₹52,32,960 | ₹17,32,960 |
| 15% | ₹77,872 | ₹56,07,024 | ₹21,07,024 |
As you can see, even a small change in interest rate significantly affects your monthly EMI and total repayment.
Factors Affecting Your EMI
Several factors decide how much EMI you will pay on a personal loan:
- Loan Amount – Higher loan amount means higher EMI.
- Interest Rate – Depends on your credit score, income, and lender policy.
- Loan Tenure – Longer tenure reduces EMI but increases total interest.
- Credit Score – A higher CIBIL score (750+) helps you get lower interest.
- Lender Policies – Banks and NBFCs offer different interest rates and processing fees.
Tips to Reduce EMI on a ₹35 Lakh Loan
If you want to manage your EMI better, follow these smart strategies:
- Choose Longer Tenure – Stretching repayment to 6 years reduces EMI burden.
- Negotiate Interest Rates – Compare lenders and bargain for the best rate.
- Make Part Prepayments – Paying extra whenever possible reduces outstanding principal.
- Maintain Good Credit Score – Improves chances of low-interest approval.
- Balance Transfer Option – Shift your loan to a lender offering lower rates.
Why Use a Personal Loan EMI Calculator?
Before applying, always check your repayment capacity using an online EMI calculator. Just enter loan amount, tenure, and interest rate – and it instantly shows your EMI. This helps you plan your monthly budget better and avoid default.
FAQs
Q1. What is the EMI for ₹35 lakh loan at 10% for 6 years?
At 10% interest, your EMI will be around ₹64,895 per month.
Q2. Can I reduce my EMI after loan approval?
Yes, you can reduce EMI by increasing tenure, negotiating with your lender, or opting for balance transfer.
Q3. Is prepayment allowed in personal loans?
Most banks allow prepayment but may charge 2-5% as foreclosure penalty. Always check terms.
Q4. What is the maximum tenure for a personal loan in India?
Generally, personal loans are offered for 1 to 7 years, depending on the lender.
Q5. Does credit score affect EMI?
Yes. A higher credit score helps you secure lower interest rates, reducing your EMI.
Disclaimer: This article is for general information only. The interest rates and terms mentioned in it depend on the policies of the bank and NBFC. These may change from time to time. Before taking any type of loan, get complete information from your bank.