Car Loan EMI Calculator
Calculate EMI for new/used cars with on-road price, processing fees, prepayment impact & Total Cost of Ownership
💰 Loan Details
Need to calculate from car price?
New & Used Cars
Finance new vehicles (7-9% p.a.) or pre-owned cars (10-14% p.a.) with flexible tenures from 1-7 years
Complete Cost Analysis
See full on-road price breakdown, processing fees, GST, prepayment impact, and Total Cost of Ownership
Visual Insights
Interactive charts showing payment breakdown, depreciation curve, and outstanding balance over time
📚 Understanding Car Loans in India
Car loans enable you to purchase new or used vehicles with convenient EMI options. Indian banks and NBFCs offer competitive interest rates ranging from 7-12% per annum, with tenures spanning 1-7 years. This comprehensive calculator reveals the complete financial picture—including on-road price components (ex-showroom, road tax, RTO, insurance), processing fees with 18% GST, optional charges (FASTag, dealer handling, accessories, extended warranty), and real-world Total Cost of Ownership factoring fuel, maintenance, and depreciation.
🔢 How Car Loan EMI is Calculated
EMI calculation uses the reducing balance method with this formula:
Each EMI comprises two parts: principal repayment and interest component. Early EMIs have higher interest; later ones pay more principal.
💸 Typical Fees & Hidden Charges
📄 Processing Fee
0.5-2% of loan amount or flat ₹2,000-₹10,000 + 18% GST
🚦 RTO & Insurance
Approximately 10-15% of ex-showroom price (varies by state & vehicle type)
⚡ Prepayment Charges
2-5% if closed within 1-2 years (many banks waive after 6-12 months)
📜 Stamp Duty
State-dependent registration charges: ₹500-₹5,000
💰 Prepayment Impact
Part-payment reduces outstanding principal, cutting total interest and tenure (if EMI remains constant). Most banks allow prepayment after 6-12 months.
📊 Total Cost of Ownership
Beyond EMI, factor in fuel (based on distance & mileage), maintenance, insurance renewals, and depreciation. TCO reveals the real monthly cost over the loan tenure.
❓ Frequently Asked Questions
How much car loan can I get on my salary?
Banks typically offer 4-5× your monthly in-hand salary as the maximum loan amount. Additionally, your EMI should not exceed 40-50% of your monthly income after deducting existing loan obligations (home loan, personal loan, credit cards). For example, with ₹50,000 monthly salary and no existing loans, you can get a loan of ₹2-2.5 lakh with EMI around ₹20-25k.
New vs used car loan – which is better?
New cars: Lower interest rates (8-10% p.a.), longer tenure (up to 7 years), higher resale value, full warranty coverage.
Used cars: Higher rates (11-16% p.a.), shorter tenure (3-5 years), faster depreciation, limited warranty.
Choose new if you value latest features and want lower EMI with long tenure. Pick used if you're okay with depreciation and want to save upfront costs.
Should I increase down payment or tenure?
Higher down payment (30-40%): Reduces loan amount, total interest paid, and monthly EMI. Frees up cash flow sooner.
Longer tenure (5-7 years): Lowers EMI making it affordable, but increases total interest significantly.
Best strategy: Max down payment you can comfortably pay + moderate tenure (3-5 years). Avoid overextending liquidity. Use our calculator to compare scenarios!
What's included in on-road price?
On-road price = Ex-showroom price (base car cost) + Road tax (state-level, 5-20% of ex-showroom) + RTO charges (registration) + Insurance (comprehensive, year 1) + Optional costs (FASTag, dealer handling, accessories, extended warranty, green cess for diesel). Our calculator breaks down each component with editable fields.
Can I get 100% financing for my car?
Most banks finance 80-90% of the on-road price, requiring 10-20% as down payment. Some NBFCs and special schemes may offer up to 100% financing, but with higher interest rates. A higher down payment (25-30%) is recommended as it reduces EMI and total interest significantly.
What documents are required for car loan?
Identity Proof: Aadhaar, PAN, Passport, Voter ID
Address Proof: Utility bills, rent agreement, passport
Income Proof: Salary slips (3 months), bank statements (6 months), Form 16 or ITR for self-employed
Vehicle Documents: Proforma invoice from dealer
Other: Passport-size photographs, existing loan details
🏦 Car Loan Interest Rates 2025 (Major Banks)
| Bank | New Car | Used Car | Processing Fee | Max Tenure |
|---|---|---|---|---|
| SBI | 8.75% | 11.50% | 0.5% (min ₹1,500) | 7 years |
| HDFC Bank | 8.80% | 12.00% | 0.5% (min ₹3,000) | 7 years |
| ICICI Bank | 9.00% | 12.50% | 0.5% (min ₹3,500) | 7 years |
| Axis Bank | 9.25% | 13.00% | 1% (min ₹4,000) | 5 years |
| Bank of Baroda | 8.70% | 11.25% | 0.5% (min ₹1,000) | 7 years |
| Kotak Mahindra | 9.50% | 13.50% | 1% (min ₹5,000) | 5 years |
* Rates as of January 2025. Actual rates may vary based on credit score, income, relationship with bank, and special offers. Processing fee is subject to 18% GST.
✅ Car Loan Eligibility Criteria
👔 Salaried Employees
- ✓ Age: 21-60 years at loan maturity
- ✓ Minimum salary: ₹15,000 - ₹25,000/month
- ✓ Employment: 1+ year total, 6+ months in current job
- ✓ CIBIL Score: 700+ preferred (650+ acceptable)
- ✓ Residence stability: 1+ year at current address
💼 Self-Employed / Business Owners
- ✓ Age: 21-65 years at loan maturity
- ✓ Business vintage: 2+ years in operation
- ✓ ITR for last 2 years showing stable income
- ✓ Minimum turnover: ₹10-15 lakh/year
- ✓ Bank statements showing regular transactions
💡 Pro Tips to Save on Car Loan
🎯 Improve CIBIL Score
A score above 750 can get you 0.5-1% lower interest rate, saving ₹10,000-₹30,000 over the loan tenure.
💰 Negotiate Processing Fee
Banks often waive or reduce processing fees for existing customers or during festivals. Always ask!
📊 Compare Multiple Offers
Get quotes from 3-4 banks and NBFCs. Use competing offers to negotiate better rates.
🏢 Use Salary Account Bank
Banks offer 0.25-0.5% lower rates and faster processing for salary account holders.
📆 Time Your Purchase
Year-end (Dec-Mar) and festival season often have special discounts on both cars and loan rates.
💵 Higher Down Payment
Paying 30-40% upfront reduces total interest significantly. Save for 6-12 months before buying.
🚀 Why Use Our Car Loan Calculator?
Complete Breakdown
On-road price, EMI, interest, TCO - all in one view
Visual Charts
Depreciation curve, payment breakdown, balance trajectory
Save & Compare
Save multiple scenarios and compare different car options
Mobile Friendly
Calculate on-the-go at the dealership showroom
Disclaimer: This calculator provides estimates for informational purposes only. Actual loan terms, interest rates, and charges may vary based on your credit profile, bank policies, and market conditions. Please verify with your bank or financial institution before making financial decisions.