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Commercial Vehicle Loan EMI Calculator by Reducing Balance
EMI
Reducing Balance
Flat Rate
Balloon Payment
Loan Amount
Loan Tenure
Year
Month
Rate of Interest
%
Copy
Share
EMI
11122
Interest
167333
Principal
500000
Total
667333
167 K
(1 Lac)
5
Year
500,000
140 K
(1 Lac)
Year
Original
Reduced
𝒊
11122
will be
EMI
for
500000
(500 K)
Loan Amount
for
5
Year
Loan Tenure
at
12.00%
Rate of Interest
.
How to Reduce Interest/ Tenure?
Pay
0
1
2
3
4
5
Extra EMI every year.
𝒊
Increase EMI by
0
2
3
5
7
10
15
20
% every year.
𝒊
Pay Lump-Sum
0
(5 K)
(10 K)
(15 K)
(20 K)
(25 K)
(30 K)
(35 K)
(40 K)
(45 K)
(50 K)
in
0
1
2
3
4
year.
𝒊
Recalculate
Share
Loan
Tenure
Interest
Original
5 year
167333
Reduced
4 year
140291
Saved
1 year
27042
Loan Payment Schedule
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
Original
Reduced
Balloon Payment
185 K
(1 Lac)
138 K
(1 Lac)
92 K
46 K
0
-
-
-
-
-
2024
2026
2028
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Commercial Vehicle Loan EMI by Reducing Balance
A Commercial Vehicle Loan EMI by Reducing Balance calculates interest on the outstanding principal amount, which decreases as you make repayments. This results in gradually lowering EMIs over time, as interest is charged only on the remaining balance. This method typically leads to lower overall interest costs compared to flat rate loans, as the interest burden reduces with the decreasing principal. Use our Commercial Vehicle Loan EMI Calculator by Reducing Balance to calculate your loan repayments. Get accurate details on monthly payments, interest, and principal, ensuring smooth financial planning for your commercial vehicle purchase.
Calculate Commercial Vehicle Loan EMI by Reducing Balance
Enter loan details like loan amount, interest rate, tenure, and choose months or years to calculate commercial vehicle loan EMI by reducing balance.
Click Calculate to view your initial loan breakdown for the commercial vehicle loan EMI and to calculate commercial vehicle loan EMI by reducing balance based on your inputs.
Customize payment options with three inputs to help you calculate your commercial vehicle loan EMI by reducing balance effectively.
Select a number of extra EMIs per year to reduce your commercial vehicle loan EMI tenure.
Increase EMIs by a percentage to manage your commercial vehicle loan EMI more efficiently.
Select lump sum payment in a specific year to lower your commercial vehicle loan EMI interest.
Adjust inputs as needed and click Recalculate to dynamically update your tenure and interest for your commercial vehicle loan EMI.
Reducing Balance EMI formula
To calculate Commercial Vehicle Loan EMI, use the Reducing Balance EMI formula for precise results. This calculation helps you understand your repayment obligations clearly.
E
M
I
=
P
×
r
×
(
1
+
r
)
n
(
1
+
r
)
n
-
1
EMI
= Equated Monthly Installments
P
= Principal loan amount
r
= Monthly interest rate
n
= Number of monthly installments
Eligibility Criteria for Commercial Vehicle Loan EMI by Reducing Balance
Age:
Applicants must be between 21 and 65 years old to qualify for a commercial vehicle loan EMI.
Income:
A stable monthly income, usually a minimum specified by the lender, is required to ensure the ability to repay the commercial vehicle loan EMI.
Credit Score:
A good credit score reflecting a history of timely repayments enhances the chances of loan approval for a commercial vehicle loan EMI by reducing balance.
Employment:
For salaried individuals, a minimum of 1 year of continuous employment is often required; for self-employed individuals, a minimum of 2 years in the current business is usually necessary to apply for a commercial vehicle loan EMI.
Commercial Vehicle Loan EMI Calculator by Reducing Balance FAQ
How does Reducing Balance EMI differ from Flat Rate EMI?
Reducing balance EMI charges interest on the decreasing principal, leading to gradually lower payments and lower total interest. Flat Rate EMI charges interest on the full principal throughout the term, resulting in fixed payments and generally higher total interest costs.
What are the advantages of a Commercial Vehicle Loan EMI by Reducing Balance?
Commercial vehicle loan EMI by reducing balance typically results in lower overall interest costs, as interest is recalculated on the decreasing principal balance. This method allows borrowers to pay off their vehicle loans more quickly due to progressively lower interest payments over time.
What are the disadvantages of a Commercial Vehicle Loan by Reducing Balance EMI?
Commercial vehicle loan by reducing balance EMI may have slightly higher initial payments compared to flat rate EMIs, as interest is calculated on the original loan amount. Although it offers cost savings, the method is more complex and requires borrowers to understand how reducing interest rates affect their repayments.
×
How extra EMI(s) help?
At the end of the year, you can pay extra EMIs out of your savings. This extra EMI payment will go towards your Loan Amount and save you on the interest as well as tenure of the loan.
Payment
Tenure
Interest
Current
5 year
167333
1 Extra EMI/ year
5 year
▶ 0 year
152629
▶ 14704
2 Extra EMI/ year
5 year
▶ 0 year
140891
▶ 26442
3 Extra EMI/ year
4 year
▶ 1 year
131443
▶ 35890
How increasing EMI helps?
As your income increases each year, you can get your EMI increased from the bank. This allows you to allocate more funds towards paying off the loan amount and save you on the interest as well as tenure of the loan.
Payment
Tenure
Interest
Current
5 year
167333
Increase EMI by 1%
5 year
▶ 0 year
164698
▶ 2635
Increase EMI by 3%
5 year
▶ 0 year
159902
▶ 7431
Increase EMI by 5%
5 year
▶ 0 year
155683
▶ 11650
How Paying Lumpsum Amount helps?
If you receive unexpected income, such as a bonus or tax refund, consider making a lump-sum payment on your loan. This can help reduce the outstanding loan amount and save you on the interest as well as tenure of the loan.
Payment
Tenure
Interest
Current
5 year
167333
Pay 10% in 2nd year
5 year
▶ 0 year
147666
▶ 19667
Pay 20% in 3rd year
5 year
▶ 0 year
146506
▶ 20827
Pay 30% in 4th year
4 year
▶ 1 year
159048
▶ 8285
How to Reduce Interest/ Tenure?
Making early payments towards Principal amount can reduce your Interest and/ or Tenure.
1. How extra EMI(s) help?
At the end of the year, you can pay extra EMIs out of your savings. This extra EMI payment will go towards your Loan Amount and save you on the interest as well as tenure of the loan.
2. How increasing EMI helps?
As your income increases each year, you can get your EMI increased from the bank. This allows you to allocate more funds towards paying off the loan amount and save you on the interest as well as tenure of the loan.
3. How Paying Lumpsum Amount helps?
If you receive unexpected income, such as a bonus or tax refund, consider making a lump-sum payment on your loan. This can help reduce the outstanding loan amount and save you on the interest as well as tenure of the loan.
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