Early Loan Closure Calculator
Thinking of paying off your loan early? Calculate your foreclosure charges, net savings, and see if closing your loan now is the right financial decision.
Early Loan Closure Calculator
Calculate foreclosure benefits and costs
Foreclosure Analysis
Continuing with EMIs might be more beneficial due to high foreclosure charges.
Foreclosure Details
Outstanding Principal
Foreclosure Charges
Total Foreclosure Amount
Savings Analysis
Current EMI
Total Remaining EMIs
Interest Saved
Net Savings
Key Insights
- •You need to close the loan completely
- •Your monthly EMI commitment of will be eliminated
- •Total interest savings:
- •After accounting for charges, net benefit:
What is Early Loan Closure?
Early loan closure, often referred to as loan foreclosure or pre-closure, is the process of repaying the entire outstanding principal amount of a loan before its scheduled tenure ends. By doing so, you stop paying interest on the borrowed amount for the remaining months or years.
While this requires a large lump sum payment, it can lead to significant savings on the total interest cost, especially if done in the earlier stages of the loan.
Benefits of Foreclosing Your Loan
Massive Interest Savings
Save lakhs in interest payments that you would have otherwise paid to the bank over the years.
Debt-Free Life
Achieve financial freedom sooner and reduce your monthly financial burden.
Improved Cash Flow
With no monthly EMI obligation, your disposable income increases instantly.
Asset Ownership
Get full ownership of your asset (home or car) immediately upon closing the loan.
Things to Consider Before Foreclosing
- •Foreclosure Charges: Check if your bank charges a penalty for early closure. This is common in fixed-rate loans and personal loans.
- •Tax Benefits: If you are closing a home loan, remember that you will lose the tax deductions on principal (Section 80C) and interest (Section 24b) repayment.
- •Opportunity Cost: Compare the interest you save on the loan vs. the returns you could earn if you invested that lump sum amount elsewhere.