1. What is the Loan Payment Formula?

The loan payment formula calculates the fixed monthly payment required to repay a loan over a specified term. This is the standard formula used by Axis Bank and other financial institutions for fixed-rate loans.

2. How Does the Calculator Work?

The calculator uses the loan payment formula:

Where:

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

Explanation: The formula accounts for both principal repayment and interest charges, with interest being front-loaded in the payment schedule.

3. Importance of Loan Calculation

Details: Understanding your loan payments helps with financial planning, comparing loan offers, and determining affordability before committing to a loan.

4. Using the Calculator

Tips: Enter the principal amount in INR, annual interest rate in percentage, and loan term in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: Does this include Axis Bank's processing fees?
A: No, this calculation only includes principal and interest. Processing fees and other charges would be additional.

Q2: What if I make prepayments?
A: Prepayments would reduce your principal and potentially shorten your loan term, but this calculator assumes no prepayments.

Q3: Is the interest rate fixed for the entire term?
A: This calculator assumes a fixed interest rate. For floating rate loans, payments would change when rates adjust.

Q4: How accurate is this calculator?
A: This provides a close estimate, but actual Axis Bank statements may show minor differences due to rounding or specific bank policies.

Q5: Can I get an amortization schedule?
A: This calculator shows the monthly payment only. For a full amortization schedule, please contact Axis Bank directly.