What is the EMI on a ₹10 lakh car loan?

At 9% over 5 years, a ₹10,00,000 car loan costs ₹20,758 a month. Over the full term you repay ₹12,45,480, of which ₹2,45,480 is interest. Over 7 years the EMI falls to ₹16,089 and the interest rises to ₹3,51,476; over 3 years the EMI is ₹31,800. The rate is an example: use the one you are quoted.

The EMI on ₹10 lakh by tenure

All at 9%, only the term changing: over 3 years, an EMI of ₹31,800 and ₹1,44,800 of total interest. Over 4 years, ₹24,885 and ₹1,94,480. Over 5 years, ₹20,758 and ₹2,45,480. Over 6 years, ₹18,026 and ₹2,97,872. Over 7 years, ₹16,089 and ₹3,51,476.

Stretching the loan from 5 years to 7 lowers the EMI by ₹4,669 a month and adds ₹1,05,996 of interest. A car also loses value while the loan runs, so a long term can leave you owing more than the car would sell for in the early years.

EMI = P × i × (1 + i)^n / ((1 + i)^n − 1), where i = 9% ÷ 12 and n = 60 months

The same loan at different rates

Over 5 years, at example rates rather than any lender’s quote: 8.5% → ₹20,517 a month. 9% → ₹20,758. 9.5% → ₹21,002. 10% → ₹21,247. Each half a percentage point adds roughly ₹240 to the EMI and about ₹14,500 to the interest over the five years.

Where the first year of EMIs goes

In the first month, ₹7,500 of the ₹20,758 is interest and ₹13,258 reduces the loan. Across the first year you pay ₹2,49,096 and the balance falls by ₹1,65,844. Halfway through, after 30 months, you still owe ₹5,55,797.

The salary it needs, and what prepaying does

Lenders test the EMI against net monthly income. Where total EMIs may take 50% of it, ₹20,758 needs about ₹41,516 a month; where they may take 40%, about ₹51,895. A home loan or any other EMI you already pay comes out of the same allowance.

Adding ₹2,000 a month to the ₹20,758 from the start clears the loan 7 months sooner and cuts total interest by ₹27,750. A single ₹1,00,000 part payment in the first month clears it 8 months sooner and cuts ₹52,854. Many car loans are on fixed rates, where a prepayment or foreclosure charge may apply, so check your loan agreement before paying early.

Interest on a car loan for personal use is not tax-deductible for a salaried person, so the EMI above is the whole cost.