Planning to buy a new Car or already own a car? How Car loan EMI is calculated and how you can save car loan interest amounts you pay? You can use Car Loan Calculator provided in this article to know the loan EMI and Interest amount you’ll be paying.
It is very easy to calculate your car loan EMI using Excel calculator, and this is what we are going to see in this article, along with car loan EMI principal and interest amounts calculation method and how prepayments can help you save your car loan interest.
When it comes to any loan, it is very important to understand what will be your EMI (Equated Monthly Installment), how long you will have to pay the EMIs and what is the interest rate at which you pay interest on your principal amount.
Car Loan Calculator Video using Excel
Watch full video to know how much interest you’ll pay in your Car loan using examples and how you can decrease interest amount that you have to pay. Most of us have a dream to own our own Car. But at the same time, it is important to understand few things about the Car loan that we opt for while buying a new house.
You can also use Car Loan Online Calculator to calculate your car loan EMI, total interest amount and total amount payable.
What is Car Loan EMI
- EMI stands for Equated Monthly Installment
- It includes repayment of the principal amount and payment of the interest on the outstanding amount of your Car loan
- A longer loan tenure helps in reducing the EMI, but increases the interest amount you pay on your Car loan
- Opt for higher Car loan EMI to reduce your interest amount and tenure
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Things to Know about Car Loan EMI
- There are 2 parts of your EMI: Principal amount & Interest Amount
- Interest Amount is high initially during your Car Loan tenure
- Principal amount is less initially during your Car Loan tenure
- High interest amount is already taken at the initial Car loan period from your EMIs
- You should pre pay most of your principal amount if you want to decrease maximum interest amount in your Car Loan
- You can easily calculate your Car loan EMI using excel calculator as we can see in above video
- Pre pay your Car loan principal amount initially as much as you can to decrease interest amount that you have to pay throughout your loan tenure
- Increase in car loan tenure will increase the interest amount you’ll pay throughout your car loan tenure
Importance of Loan Interest Rate
- It is very important to know the interest rate of loan
- Compare the interest rates from various banks and financial institutions before applying for loan
- Know the difference between fixed and floating interest rates
- Go for floating interest rates to get benefits of interest rates decrease
- Your interest amount in every EMI depends on this Interest rate
- More interest rate means, more interest amount that you pay on your loan. Less interest rate means, less interest amount you pay.
ALSO READ: PPF Interest Calculator | Public Provident Fund Calculator [EXCEL]
How Car Loan Calculator helps you
- Using an excel car loan calculator can help you know your monthly EMI
- You can provide the car loan tenure and loan interest rate in order to know how much interest you’ll pay
- You can also check the decrease in principal amount if you pre pay some of the principal amount
- Car Loan calculator will help you plan your other goals according to your monthly EMIs and pre payments
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How to Save Car Loan Interest
- You can easily Save the car loan interest amount by pre paying your principal amount
- Car Loan interest amount is calculated based on your outstanding principal amount remaining
- So in order to decrease the interest that you’ll pay, you need to decrease your outstanding principal amount
- The sooner you decrease your outstanding principal amount at the initial stages of loan tenure, more interest you’ll be saving
You can watch this below video to see how Home Loan Prepayments will help save Home Loan interest using Excel Examples. In the same way, you can save interest amount for your Car Loan as well.
With Home Loan Prepayment of Rs. 1 Lac, you can save up to Rs. 68,442 in your entire Home Loan Tenure. Watch this video to see the calculation in excel.
Home Loan Prepayment Calculation Video
Some more videos
DOWNLOAD CAR LOAN EMI CALCULATOR
Please fill below details to Download Car Loan Excel Calculator:
Some more Reading:
- Home Loan Mistakes to avoid
- How to save tax on Salary above 5 Lakh
- Rs. 1000 PPF Interest Calculation for 15 Years
- SIP vs Step up SIP Returns Calculation
Frequently Asked Questions (FAQs)
Q. What does an EMI mean?
Ans. EMI refers to the ‘Equated Monthly Installment’ which is the amount you will pay on a specific date each month till the loan is repaid in full. The EMI comprises of the principal and interest components which are structured in a way that in the initial years of your loan, the interest component is much larger than the principal component, while towards the latter half of the loan, the principal component is much larger.
Q. What is a Car loan and how does it work?
Ans. Car loans are availed for purchase of a new Car. In case you are falling short of funds to buy a new car, you can take a loan and buy new car. The EMI for car loan taken is calculated based on above video.
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Thank you so much for these calculators and for the smooth explanation.
welcome Kishan!
Getting this message when I tried to submit the form to download car loan emi calculator.
“The form was unable to submit. Please contact the site administrator.”
issue is solved now, please check. thanks for informing