Loan Foreclosure Calculator
*This calculator provides an estimate based on standard EMI calculations. Actual foreclosure amounts may vary based on your lender's specific terms, interest compounding methods, and any additional charges not accounted for here. Always consult your bank or financial institution for the precise foreclosure amount.
Loan Foreclosure Calculator – Calculate Savings & Interest Benefits
If you’re planning to close your loan before its tenure ends, a Loan Foreclosure Calculator can help you determine the potential savings on interest and the final payout. At Calculator91.com , our “free online Loan Foreclosure Calculator” provides accurate insights into how much you can save by prepaying your loan.
What is Loan Foreclosure?
Loan foreclosure refers to the process of repaying the entire outstanding loan amount before the scheduled tenure ends. Borrowers often opt for foreclosure to reduce their debt burden and save on interest payments.
Types of Loan Foreclosure
1. Full Foreclosure – Paying the entire remaining loan amount in one go.
2. Partial Foreclosure – Paying a lump sum amount to reduce the principal, thereby lowering future EMIs or tenure.
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Why Use a Loan Foreclosure Calculator?
A “Loan Foreclosure Calculator” helps you:
✔ Estimate total interest savings by closing the loan early.
✔ Compare foreclosure vs. continuing EMI payments to make an informed decision.
✔ Check prepayment penalties (if applicable) imposed by lenders.
✔ Plan finances better by understanding the exact foreclosure amount.
How Does the Loan Foreclosure Calculator Work?
Our free Loan Foreclosure Calculator uses the following inputs:
• Current Outstanding Loan Amount
• Remaining Loan Tenure
• Interest Rate
• EMI Amount
• Foreclosure Date
Based on these details, the calculator computes:
✅ Total Interest Saved by foreclosing the loan early.
✅ Final Foreclosure Amount (including any penalties).
✅ Comparison of foreclosure vs. regular EMI payments.
How to Calculate Loan Foreclosure Manually
If you want to manually estimate your loan foreclosure savings, follow these steps:
Step 1: Check Your Outstanding Principal
The remaining principal is the amount you still owe the bank.
Step 2: Calculate Remaining Interest
Use the formula:
Remaining Interest = (Outstanding Principal × Interest Rate × Remaining Tenure) / (12 × 100)
Step 3: Add Prepayment Charges (if any)
Some banks charge 1-5% of the outstanding amount as foreclosure fees.
Step 4: Total Foreclosure Amount
Total Foreclosure Amount = Outstanding Principal + Remaining Interest + Prepayment Penalty
Example of Loan Foreclosure Calculation:
Let’s assume:
• Loan Amount: ₹10,00,000
• Interest Rate: 8.5% p.a.
• Tenure: 10 years (120 months)
• EMI: ₹12,398
• Foreclosure after 5 years (60 EMIs paid)
Calculations:
1. Outstanding Principal after 5 years: ₹6,20,000
2. Remaining Interest:
= (6,20,000 × 8.5 × 5) / (12 × 100) = ₹2,20,750
3. Prepayment Penalty (2%): ₹12,400
4. Total Foreclosure Amount: ₹6,20,000 + ₹2,20,750 + ₹12,400 = ₹8,53,150
Total Interest Saved:
• Total payable if continued: 120 EMIs × ₹12,398 = ₹14,87,760
• Amount paid till foreclosure: 60 EMIs × ₹12,398 = ₹7,43,880
• Total cost if foreclosed: ₹7,43,880 + ₹8,53,150 = ₹15,97,030
• Savings: ₹14,87,760 – ₹15,97,030 = ₹ -1,09,270 (Loss in this case due to penalty)
“This example shows that foreclosure may not always be beneficial if prepayment penalties are high.”
When Should You Foreclose a Loan?
Foreclosing a loan is beneficial when:
✔ You have surplus funds and no high-return investment options.
✔ The interest saved outweighs the prepayment penalty.
✔ You want to reduce debt stress and improve credit score.
When Should You Avoid Foreclosure?
Avoid foreclosing if:
❌ Prepayment penalty is higher than interest savings.
❌ You have other high-interest debts (like credit cards) to clear first.
❌ You lack emergency funds after foreclosure.
Prepayment Penalties in India:
Most banks charge 0-5% foreclosure fees on loans:
SBI, PNB, Bank of Baroda: 0% on floating-rate home loans.
HDFC, ICICI, Axis Bank: 0-2% penalty on home loans.
Personal Loans: 2-5% prepayment charges.
Always check with your lender before foreclosure .
Tax Implications on Loan Foreclosure
• Home Loans: No tax benefit on principal repayment under “Section 80C” if foreclosed.
• Interest Savings: Reduced tax deductions under “Section 24” for home loans.
How to Use Calculator91’s Loan Foreclosure Calculator?
1. Visit Calculator91.com
2. Enter Loan Details (Outstanding Amount, Interest Rate, Tenure).
3. Click “Calculate” to see interest savings & foreclosure amount.
4. Adjust inputs to compare different scenarios.
Benefits of Using Our Loan Foreclosure Calculator
🔹 100% Free & Online – No registration required.
🔹 Accurate Results – Real-time calculations.
🔹 User-Friendly – Simple interface for quick analysis.
🔹 Helps in Financial Planning – Decide whether foreclosure is worth it.
Final Thoughts:
Foreclosing a loan can save you thousands in interest, but penalties may reduce benefits. Use Calculator91.com’s Loan Foreclosure Calculator to analyze your savings and make an informed decision.
Plan smart, save more, and stay debt-free