What will be your EMI, interest, and repayment if you take Rs 60 lakh loan for 15, 20, 25, or 30 years?
Home loan EMI, interest, repayment calculations: Loan tenure plays a key role in determining the repayment amount of a home loan. The same loan at the same interest rate taken for different durations results in different EMIs and repayments.
Home loan EMI, interest, repayment calculations: When we take home loans, we most likely keep our equated monthly instalment (EMI) according to our monthly income. We set it at a point where our monthly expenses are met and other financial goals are also not disturbed. But the loan duration in a home loan plays a key role. The longer the duration, the higher the repayment will be. It happens because the interest amount increases with the tenure of the loan. So, if two persons take out a loan of a similar amount and the same interest rate for different tenures, the one who has taken it for a longer duration will end up paying quite a substantially higher interest amount compared to the one who takes it for a shorter duration. Let's see this difference with examples and also see what the EMIs will be for a Rs 60 lakh loan if it has been taken for 15, 20, 25, or 30 years.
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(Disclaimer: These are projections. Actual calculations may vary.)
EMI on Rs 30 lakh home loan repayment
Let's see the difference at a small level. Assume that A and B have taken a Rs 30 lakh loan at a 9.5 per cent interest rate for 15 years and 25 years, respectively.
A's estimated EMI will be Rs 31,327, the estimated interest will be Rs 26,38,813, and the estimated repayment will be Rs 56,38,813.
EMI on Rs 30 lakh home loan repayment
B's estimated EMI will be Rs 26,211, the estimated interest will be Rs 48,63,270, and the estimated repayment will be Rs 78,63,270.
It means B is paying an estimated Rs 22,24,457 extra in 10 years.
Rs 1 crore, 20-year home loan repayment
Let's take the example of a big-ticket loan of Rs 1 crore. A, B, and C take it at a 9.5 per cent interest rate for 20, 25, and 30 years, respectively.
A's estimated EMI will be Rs 93,213, the estimated interest will be Rs 1,23,71,149, and the estimated repayment will be Rs 2,23,71,149.
Rs 1 crore, 25-year home loan repayment
B's estimated EMI will be Rs 87,370, the estimated interest will be Rs 1,62,10,900, and the estimated repayment will be Rs 2,62,10,900.
Rs 1 crore, 30-year home loan repayment
C's estimated EMI will be Rs 84,085, the estimated interest will be Rs 2,02,70,751, and the estimated repayment will be Rs 3,02,70,751.
Here, we see that for the same loan, C is spending Rs 40,59,851 more than B and Rs 78,99,602 more than A for taking it at 5- and 10-year durations, respectively.
Calculations for story
For our calculation, we will take the example of a Rs 60,00,000 loan at a 10 per cent interest rate and will calculate estimated EMI, interest, and repayment amounts for tenures of 15, 20, 25, and 30 years, respectively.
EMI, interest, repayment for Rs 60 lakh, 15-year loan (Case 1)
In 15 years, the estimated EMI will be Rs 64,476, the estimated interest will be Rs 56,05,735, and the estimated repayment will be Rs 1,16,05,735.
EMI, interest, repayment for Rs 60 lakh, 20-year loan (Case 2)
In 20 years, the estimated EMI will be Rs 57,901, the estimated interest will be Rs 78,96,312, and the estimated repayment will be Rs 1,38,96,312.
EMI, interest, repayment for Rs 60 lakh, 20-year loan (Case 2)
In Case 2, the borrower will repay an estimated Rs 22,90,577 higher repayment amount than in Case 2.
EMI, interest, repayment for Rs 60 lakh, 25-year loan (Case 3)
In 25 years, the estimated EMI will be Rs 54,522, the estimated interest will be Rs 1,03,56,613, and the estimated repayment will be Rs 1,63,56,613.
EMI, interest, repayment for Rs 60 lakh, 25-year loan (Case 3)
In Case 3, the borrower will repay an estimated Rs 24,60,301 more than in Case 2 and an estimated Rs 47,50,878 more than in Case 1.
EMI, interest, repayment for Rs 60 lakh, 30-year loan (Case 4)
In 30 years, the estimated EMI will be Rs 52,654, the estimated interest will be Rs 1,29,55,546, and the estimated repayment will be Rs 1,89,55,546.
EMI, interest, repayment for Rs 60 lakh, 30-year loan (Case 4)
In Case 4, the borrower will repay an estimated Rs 73,49,811 more than in Case 1, an estimated Rs 50,59,234 more than in Case 2, and an estimated Rs 25,98,933 more than in Case 3.
Conclusion
Through different examples, we can see that a 5-year delay can increase the repayment amount by many lakhs on the same amount and the same interest rate loan.