Used Car Loan EMI Calculator

Benefits of Our Used Car Loan EMI Calculator

Here are some ways the Urban Money’s Second Hand Car Loan EMI Calculator helps in making smarter financial decisions:

Easy to Use Anytime, Anywhere

Using any digital device, you can use our Used car loan EMI calculator anywhere, anytime. The service is available 24/7 on our official website, providing financial clarity whenever needed. This ensures you don’t have to stand in long bank lines for every small doubt.

Budget Management

Knowing your monthly estimated EMI payments will help you plan your finances well. You could avoid impulse purchases and know exactly how much you would have to save money in each loan scenario. Overall, you can control cash flow throughout the loan period.

Compare Other Loan Options

As a borrower, you should be entitled to compare loans from various lenders simultaneously. This will help you plan your finances according to your income and long-term goals. It also gives you the power to negotiate better terms based on informed choices.

Instant Visualisation

Urban Money lets you visualise your repayment plan by breaking down the interest and principal components in percentages. This visual breakdown shows how different loan inputs can impact your overall finances. It eliminates the need for guesswork and gives you clarity at every step. As a result, you can make quicker and more confident borrowing decisions.

How Does a Used Car Loan EMI Calculator Work?

The used car EMI calculator on Urban Money uses the general formula used by most lenders, which is:

P * r * (1 + r)^n / ((1 + r)^n – 1)

Here,

• P= Principal Amount
• r= Interest Rate
• n= Tenure

To use this calculator, you can follow this step-by-step guide:

• Go to Urban Money using any digital device. You won’t be asked to sign in.
• Click the Calculator button on the top right, and scroll down to the Used Car Loan EMI calculator.
• Enter the desired inputs into the calculator, and instantly receive the EMI estimate.

Key Inputs Required for Calculating Used Car Loan EMI

You’ll need to enter a few essential details to get an accurate EMI estimate for your used car loan. These inputs help the calculator provide a personalised and reliable repayment schedule:

• Loan Amount: Each lender allows for a limited loan amount for various borrowing purposes. You can verify this for used cars on Urban Money, and once you’re confident that the loan amount aligns with your funding needs, simply input it into the calculator for accurate results.
• Rate of Interest: Different lenders will offer different interest rates on loans, payable monthly along with the principal amount, according to your credit score. You can input the same on the calculator, as even a slight difference in rate can change your EMI significantly.
• Loan Tenure: This refers to the period you’ll repay the loan, typically in months or years. Longer tenure with smaller loan amounts can significantly reduce your EMI payments; however, shorter tenure can lead to higher EMI payments. Choosing the right tenure is essential as it will affect your long-term and short-term financial needs.

Factors That Affect Your Used Car Loan EMI

Several factors can directly affect your monthly used car loan EMI payments and total interest payable. These include:

• Loan Amount and Tenure: Higher loan amounts can lead to larger EMI instalments. This can only be controlled by increasing the overall loan tenure, reducing monthly payments, but increasing the total interest payable.
• Credit Score: With a high credit score and a stable repayment history, you can secure loans at lower interest rates. This is because your high creditworthiness reduces the lender’s risk.
• Lender Policy: Different lenders have different rules and regulations for EMI structures, fees, and terms. Choosing a lender with flexible terms can help reduce your EMI burden, ensuring that you get debt-free quickly from the loan.
• Down Payment: Many lenders will ask you for a down payment for purchasing a used car, using the quoted vehicle cost. If you can pay a higher sum as a down payment, you will have to pay off less money for the vehicle each month, and vica versa.

Used Car Loan EMI Calculation Example

Here is an example of how Urban Money calculates the car EMI payment online based on the metrics:

Suppose you plan to take a used car loan with these details:

• Loan Amount (P): ₹5,00,000
• Annual Interest Rate: 10%
• Loan Tenure: 3 years (36 months)

If the annual interest rate is 10%, then the monthly interest rate stands at 10/ (12*100)= 0.00833%

Now, putting in the values to the formula, the EMI comes up to,

500000×0.00833×(1+0.00833)36​ / (1+0.00833)36 – 1

= INR 16,137

So, over the loan tenure of 3 years, you will pay INR 81,000 in total as interest. If the loan tenure is reduced to 2 years, this metric changes to:

• Monthly EMI INR 23,072
• Total Interest Payable= INR 53,739

Hence, reducing the tenure increased the monthly EMI payments for 2 years but led to a savings of INR 27,261 in interest.

Tips to Reduce Your Used Car Loan EMI

Here are some practical tips to reduce your Used Car Loan EMI payments:

• Make a larger down payment while purchasing the car, which will lower your monthly EMI and help you save on interest over time.
• Spreading your loan over a longer tenure can reduce your EMI burden and make the loan more affordable for salaried individuals.
• Use Urban Money to compare loan offers from various banks and NBFCs.
• Make partial prepayments regularly to reduce the principal and interest amount every year.