1. What is the Auto Loan Payment Formula?

The auto loan payment formula calculates the fixed monthly payment required to repay a car loan over a specified term. It accounts for the principal amount, interest rate, and loan duration.

2. How Does the Calculator Work?

The calculator uses the standard loan payment formula:

Where:

• \( PMT \) — Monthly payment (INR)
• \( P \) — Principal loan amount (INR)
• \( r \) — Monthly interest rate (annual rate divided by 12)
• \( n \) — Total number of payments (loan term in months)

Explanation: The formula calculates the fixed payment needed to fully amortize the loan over its term, accounting for both principal and interest.

3. Importance of Auto Loan Calculation

Details: Understanding your monthly payment helps with budgeting and ensures the loan fits your financial situation before committing to a purchase.

4. Using the Calculator

Tips: Enter the loan amount in INR, annual interest rate (ICICI Bank's current rate), and loan term in years. The calculator will show your estimated monthly payment.

5. Frequently Asked Questions (FAQ)

Q1: What is ICICI Bank's current auto loan interest rate?
A: Rates vary (typically 8.5%-12% p.a.) based on credit score, loan term, and vehicle type. Check ICICI's website for current rates.

Q2: Does this include insurance and other charges?
A: No, this calculates only the principal and interest. Additional costs like insurance, registration, or processing fees are extra.

Q3: How does loan term affect payments?
A: Longer terms reduce monthly payments but increase total interest paid. Shorter terms have higher payments but lower total cost.

Q4: Are there prepayment options with ICICI?
A: ICICI allows prepayment, usually after 12 EMIs, with possible charges. Check current prepayment policies.

Q5: What's the maximum loan term ICICI offers?
A: Typically up to 7 years for new cars, shorter for used cars, depending on vehicle age and condition.