Loan Prepayment Calculator

When you pay extra principal, interest stops accruing on that amount. Banks typically let you choose to keep the same EMI and finish earlier (reduce tenure) or keep the same tenure and lower the EMI. EnrichReturns runs both modes on your outstanding balance so you can see interest saved before you instruct the lender.

Enter outstanding principal, annual rate, remaining tenure, prepayment amount, and mode. The tool builds an amortization schedule without the prepay, applies the lump sum to principal, then either recomputes EMI for the same tenure or keeps the old EMI and counts months until the balance clears.

Baseline EMI uses the standard reducing-balance formula EMI = P × r × (1+r)^n / ((1+r)^n − 1). After prepay, new principal = P − prepayment (capped at P). Reduce-EMI mode recalculates EMI on the new principal for the same n. Reduce-tenure mode keeps the original EMI and simulates month-by-month until the balance is cleared.

Outstanding ₹40 lakh at 8.5% with 15 years left has an EMI of about ₹39,390. A ₹5 lakh prepayment in reduce-tenure mode clears the loan in roughly 141 months instead of 180 — about 39 months sooner — and saves roughly ₹10.5 lakh of interest in this illustration. Keep an emergency fund before large prepays; floating-rate resets can change the path.

Makes the tenure-vs-EMI trade-off concrete in rupees. Shows interest saved rather than only a new EMI number. Helps decide whether cash is better used for prepay, investments or liquidity.

Assumes a constant rate after prepay and ignores lender fees, foreclosure windows and tax treatment of interest under Section 24(b). Confirm process and any charges with your bank. Educational only — not a lender instruction.