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Car Loan EMI Calculator

Calculate your monthly car loan EMI based on car price, down payment, and interest rate.

₹10,00,000
₹1,00,000₹1Cr
20%
0%50%
9%
1%20%
5 years
1yr7yr

Loan Amount

₹8,00,000

Monthly EMI

₹16,607

Down Payment

₹2,00,000

Total Interest

₹1,96,420

Total Payment

₹9,96,420

Yearly Repayment Breakdown

₹9,96,420

Yearly Repayment Breakdown data
YearPrincipalInterest
1₹1,32,668₹66,616
2₹1,45,113₹54,171
3₹1,58,726₹40,558
4₹1,73,615₹25,669
5₹1,89,878₹9,382
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How Car Loan EMI Works

Car loan EMI is calculated on the financed amount after subtracting your down payment from the car's on-road price. Car loans in India typically have a tenure of 1-7 years. The interest rate depends on whether you're buying a new or used car, your credit score, and the bank's policies. Most banks finance up to 80-90% of the car's ex-showroom price.

Current Car Loan Interest Rates (2026)

  • SBI — 8.65% onwards (new car)
  • HDFC Bank — 8.75% onwards
  • ICICI Bank — 8.90% onwards
  • Axis Bank — 8.95% onwards
  • Bank of Baroda — 8.70% onwards

Used car loans attract higher rates — typically 11-14% with shorter tenures (3-5 years).

New Car vs Used Car Loan

New car loans offer lower interest rates (8-10%), higher financing (up to 90% of ex-showroom), and longer tenure (up to 7 years).

Used car loans have higher rates (11-14%), lower financing (up to 80% of valuation), shorter tenure (3-5 years), and the car must typically be less than 5 years old at loan maturity.

Tips to Get the Best Car Loan Deal

  • Compare rates from at least 3-4 banks before taking dealer finance
  • Opt for a shorter tenure (3-5 years) to save on interest — cars depreciate fast
  • Make a higher down payment to reduce loan amount and interest burden
  • Maintain a credit score above 750 for the best interest rates
  • Negotiate the on-road price first, then discuss financing separately

Frequently Asked Questions

What is the ideal car loan tenure?
3-5 years is recommended. Cars depreciate 15-20% annually, so a longer tenure means you could end up owing more than the car is worth. Shorter tenure also means lower total interest, even though the EMI is higher.
Can I get tax benefits on car loan?
Car loans do not offer tax benefits for salaried individuals. However, if the car is used for business purposes, the interest can be claimed as a business expense under Section 43. Self-employed individuals can claim depreciation on the car as well.
What is the minimum down payment for car loan?
Most banks require a minimum down payment of 10-20% of the ex-showroom price. A higher down payment of 25-30% is recommended as it reduces your EMI, total interest, and the risk of being upside-down on the loan.
Should I prepay my car loan?
Yes, prepaying your car loan is advisable since cars are depreciating assets. Most banks do not charge a prepayment penalty after the first year. Prepaying even ₹50,000-₹1,00,000 early on can save significant interest.

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