Loan Calculator | EMI, Prepayment & Amortization Table 2026 — Free Online Tool

Monthly installment for any loan.

Quick Answer

Calculate your loan EMI (Equated Monthly Installment) using: EMI = [P x R x (1+R)^N]/[(1+R)^N - 1], where P is principal, R is monthly interest rate, and N is monthly tenure. Try our tool to check monthly installments instantly.

Last updated: 2026-07-31 Editorially reviewed by PakDigitalz Editorial Team

Loan Type

Standard 30-yr mortgage. PMI required if down < 20%.

Currency

Home PriceDown Payment (5%)Annual Rate (%)Term (Months)

Bank Processing FeeFee Evaluation Type

Net Hand-Received Cash:$300,000

Monthly P&I Payment

$1,896

Total Monthly (incl. fees)

$2,015

Net Total Payable

$718,527

True Effective APR

7.0%

Conventional Mortgage Breakdown

Down Payment (5%)$15,000

Financed Amount$285,000

PMI / Month (LTV 95%)$119

Loan Payable Ratio:Principal 42% · Interest 58%

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Loan EMI Formulas — How Banks Calculate Your Installment

All bank loans in Pakistan and globally are calculated using either the Reducing Balance (most common) or Flat Rate method. The reducing balance method is the globally accepted standard and charges interest only on the outstanding principal each month.

📐 EMI Formula (Reducing Balance)

EMI = P × R × (1+R)^N ÷ [(1+R)^N − 1]

P = Principal | R = Monthly Rate | N = Months

Example: Rs. 1,000,000 at 18%/yr for 5yrs → EMI ≈ Rs. 25,393

⚖️ True APR Formula

APR = [(Total Cost − Principal) ÷ Principal] ÷ N × 12 × 100

Includes processing fees & charges

Processing fees increase effective APR beyond quoted rate

Current SBP Policy Rate & Bank Lending Rates — Pakistan 2026

Loan Type	Typical Rate (p.a.)	Max Tenure	Notes
Personal Loan	18%–28%	5 years	Unsecured, higher rates
Car Financing	16%–22%	5–7 years	Asset-backed, lower rate
Home Loan (Meezan)	12%–18%	20 years	Islamic Ijarah basis
SME Business Loan	20%–30%	3–5 years	SMEDA supported
Credit Card	36%–42%	Revolving	Highest effective APR

* SBP Policy Rate as of 2026: 12%. Banks add margin above KIBOR. Rates vary by bank and credit score.

Islamic Banking vs Conventional — Loan Differences

Q: What is Murabaha financing?

A: Murabaha is an Islamic financing mode where the bank purchases an asset (car, home, goods) and sells it to you at a mutually agreed markup price. The profit margin is fixed upfront — it is not interest, as the bank takes ownership risk.

Q: What is Ijarah (Islamic Leasing)?

A: Ijarah is a lease-to-own structure. The bank buys the asset and leases it to you for monthly rentals. At end of tenure, ownership is transferred. Used widely for home finance by Meezan Bank and Islamic windows of HBL, UBL, MCB.

Q: How does prepayment work in Islamic banking?

A: In Islamic finance, the bank may or may not allow rebates on early settlement. This depends on the contract terms. Unlike conventional banks, Islamic banks cannot charge interest on prepayment penalties.

Q: Is there a minimum credit score for loans in Pakistan?

A: Pakistan does not use a standardized credit score system like FICO. Banks check your Credit Information Bureau (CIB) report from SBP to assess previous defaults, existing loans, and repayment history.

How to Use This Tool

Select loan type: VA Loan, FHA Loan, Conventional, USDA, or Personal/Auto.
Enter home price or loan amount and adjust the down payment percentage.
Review the automatically applied interest rate, term, and insurance costs.
Optionally simulate extra monthly payments to see interest saved and time cut.
Download the full amortization schedule as a CSV file.

Formula & Specifications

EMI = [P × r × (1+r)^n] ÷ [(1+r)^n − 1] | VA: 0% down, no PMI | FHA: 3.5% down + MIP 1.75% upfront

About Loan Calculator | EMI, Prepayment & Amortization Table

Free VA loan calculator and FHA loan calculator. Estimate monthly mortgage payments, down payments, PMI, MIP, and VA funding fees. Supports conventional, USDA, personal, and auto loans.

Frequently Asked Questions

What is a VA loan calculator?

A VA loan calculator helps eligible veterans and service members estimate monthly mortgage payments. VA loans require no down payment and no PMI, making them one of the most affordable home loan options available.

What is the FHA loan down payment?

FHA loans require a minimum 3.5% down payment for borrowers with a credit score of 580 or higher. This makes FHA loans a popular choice for first-time home buyers.

How does a VA loan differ from a conventional loan?

VA loans are government-backed and require 0% down payment with no PMI. Conventional loans typically require 3-20% down payment and PMI if you put less than 20% down. VA loans also typically feature competitive interest rates.

What is the FHA mortgage insurance premium (MIP)?

FHA loans require an upfront MIP of 1.75% of the loan amount plus an annual MIP of approximately 0.55% of the loan, depending on your loan term and LTV ratio.

What is the difference between Reducing Balance and Flat Rate?

Reducing Balance charges interest only on your outstanding balance — as you pay off principal, interest decreases. Flat Rate charges interest on the initial principal for the entire loan tenure, making it more expensive overall.

How do upfront processing fees affect the true cost of a loan?

Processing fees reduce the actual cash disbursed into your account while keeping your repayment EMI identical. This increases your overall annualized borrowing cost, commonly represented as the True APR (Annual Percentage Rate).

Can I prepay my loan early?

Yes. VA and FHA loans have no prepayment penalties. Use the extra payment feature to simulate how extra monthly payments shorten your payoff timeline and cut total interest.