FinCalc

Loan Comparison

Compare two loan offers side by side

Loan A

₹
%
Yrs

Loan B

₹
%
Yrs

Loan A

EMI: ₹43,391

Total Interest: ₹54,13,879

Total Payment: ₹1,04,13,879

Loan B — Better

EMI: ₹50,713

Total Interest: ₹41,28,399

Total Payment: ₹91,28,399

Loan B saves you ₹12,85,480 in interest and ₹7,322/month in EMI.

What is a Loan Comparison?

When you're shopping for a loan, comparing two offers purely on interest rate can be misleading. A slightly lower rate with a shorter tenure might result in a higher EMI, or a longer tenure might look cheaper monthly but cost far more in total interest. This tool puts two loan offers side by side and shows you the real cost difference.

The comparison covers EMI amounts, total interest paid, and total cost of the loan — the three numbers that actually matter for your decision. It helps you see past the headline interest rate to the actual financial impact on your wallet over the full loan period.

When to Use This Calculator

  • Comparing home loan offers from two different banks
  • Deciding between a shorter tenure at a higher rate vs a longer tenure at a lower rate
  • Evaluating the impact of paying processing fees upfront for a lower rate
  • Comparing a pre-approved loan offer against market rates
  • Helping family members choose between competing loan offers

Key Terms

Processing Fee

A one-time fee (typically 0.25%–1% of loan amount) charged by banks to process your loan application. This adds to the effective cost of the loan.

Total Cost of Loan

The sum of all EMI payments over the full tenure — equal to (EMI × number of months). The difference between total cost and principal is total interest paid.

Effective Interest Rate

The true cost of a loan after factoring in fees, charges, and compounding. Two loans with the same stated rate can have different effective rates.

Frequently Asked Questions

Should I always choose the loan with the lower interest rate?+
Not necessarily. A lower interest rate with a shorter tenure could mean a higher EMI that strains your budget. Compare the total cost (principal + total interest + fees) and make sure the monthly EMI is comfortable — typically under 40% of your take-home pay.
How much difference does 0.5% make on a home loan?+
On a ₹50 lakh, 20-year loan, a 0.5% difference (say 8.5% vs 9%) changes the EMI by about ₹1,600/month and saves around ₹3.8 lakh in total interest. The impact grows with loan amount and tenure.
Should I consider the tenure difference or the rate difference?+
Both matter, but for the same EMI budget, tenure has a bigger impact on total interest. A 5-year difference in tenure on a ₹50 lakh loan can change total interest by ₹10–15 lakh. Always compare total cost, not just EMI or rate alone.
Does this comparison account for processing fees?+
This tool compares EMI, total interest, and total payments. Processing fees are a one-time cost — add them separately to the total cost of each option for a complete comparison.