1. What is Home Loan Amortization?

Home loan amortization is the process of paying off a mortgage loan over time through regular payments. Each payment covers both interest and principal, with the interest portion decreasing and principal portion increasing over the loan term.

2. How Does the Calculator Work?

The calculator uses the standard amortization formula:

Where:

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

Explanation: The formula calculates the fixed monthly payment required to fully amortize a loan over its term, accounting for compound interest.

3. Importance of Loan Amortization

Details: Understanding amortization helps borrowers see how much of each payment goes toward principal vs. interest, plan for total loan cost, and evaluate refinancing options.

4. Using the Calculator

Tips: Enter the principal amount in INR, annual interest rate (as offered by LIC of India), and loan term in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is LIC's current home loan interest rate?
A: LIC's home loan rates vary; check their official website or branch for current rates as they change periodically.

Q2: Are there any prepayment charges with LIC home loans?
A: LIC typically allows prepayment without charges, but terms may vary by loan agreement.

Q3: Does this calculator include insurance or other fees?
A: No, this calculates only principal and interest. LIC home loans may have additional insurance components.

Q4: How does EMI change if interest rates change?
A: For fixed-rate loans, EMI stays constant. For floating rates, EMI changes when rates are revised.

Q5: What is the maximum loan term available from LIC?
A: LIC typically offers home loans up to 30 years, subject to age and other eligibility criteria.