Calculate your home renovation loan EMI
Year-by-year repayment schedule
| Year | Principal paid | Interest paid | Balance at year end |
|---|
Reducing-balance method. Results are estimates for planning; the lender's Key Fact Statement is final. Insurance, legal and other charges are not included.
Renovation can be financed as an unsecured personal loan over up to 5 years or as a secured home improvement loan over a much longer tenure. The longer secured tenure lowers the EMI but adds legal and valuation costs.
Home Renovation Loan at a glance
The figures the calculator starts with come from these typical ranges. Change them to match the offer in front of you.
| Feature | What to expect |
|---|---|
| Typical loan amount | Roughly ₹1 lakh to ₹40 lakh; unsecured routes at the lower end |
| Tenure | 12 to 60 months unsecured; up to 15 or 20 years for secured routes |
| Indicative interest rate | Roughly 9% to 24% a year; secured routes sit at the lower end |
| Processing fee | Commonly 0.5% to 3% of the amount, plus GST; secured loans may add legal and valuation fees |
| Security / collateral | Varies. None for a personal loan; the property itself for a home improvement loan or top-up |
| Typical time to disbursal | 2 to 5 days unsecured; one to four weeks for secured routes with legal checks |
From our Home Renovation Loan guide. Ranges are indicative; your offer may differ.
Home Renovation Loan EMI table at 13%
Monthly EMI for common home renovation loan amounts at an example rate of 13% a year, on the reducing-balance method lenders use. Read across a row to see how a longer tenure lowers the EMI, and remember that it raises the total interest: on ₹7.5 lakh, the interest is ₹1,59,737 over 3 years but ₹2,73,888 over 5 years.
| Loan amount | EMI for 3 years | EMI for 4 years | EMI for 5 years |
|---|---|---|---|
| ₹2.5 lakh | ₹8,423 | ₹6,707 | ₹5,688 |
| ₹5 lakh | ₹16,847 | ₹13,414 | ₹11,377 |
| ₹7.5 lakh | ₹25,270 | ₹20,121 | ₹17,065 |
| ₹10 lakh | ₹33,694 | ₹26,827 | ₹22,753 |
How the interest rate changes your home renovation loan EMI
Your rate depends on your credit score, income, the lender and the loan details. On ₹5 lakh over 4 years, the gap between the lowest and highest indicative rate is ₹1,85,203 in total repayment, which is why it pays to compare offers before you accept one.
| Interest rate | Monthly EMI | Total interest | Extra vs lowest rate |
|---|---|---|---|
| 9% | ₹12,443 | ₹97,241 | — |
| 13% | ₹13,414 | ₹1,43,860 | +₹46,619 |
| 18.5% | ₹14,818 | ₹2,11,286 | +₹1,14,045 |
| 24% | ₹16,301 | ₹2,82,444 | +₹1,85,203 |
If your floating rate goes up
Long home renovation loans are often on a floating rate linked to an external benchmark such as the repo rate, so the rate can change during the loan. When it rises, lenders usually extend the tenure first and keep the EMI the same, which quietly adds interest. RBI rules require lenders to give you the choice of a higher EMI, a longer tenure or both. Here is what a rise would do to a loan of ₹5 lakh over 4 years:
| Rate rise | New EMI if tenure is kept | Extra time if EMI is kept |
|---|---|---|
| +0.5% (to 13.5%) | ₹13,538 (+₹124) | +1 month |
| +1% (to 14%) | ₹13,663 (+₹249) | +2 months |
| +1.5% (to 14.5%) | ₹13,789 (+₹375) | +2 months |
Choosing the higher EMI usually costs less in total. If the rate falls, ask for the EMI to stay the same so the tenure shortens.
The real cost of a home renovation loan: fees and APR
The EMI covers interest and principal only. Lenders also charge a processing fee, commonly around 0.5% to 3% of the amount on home renovation loans, plus 18% GST, and it is usually deducted from the money you receive. Because you pay the EMI on the full amount but receive less, the annual percentage rate (APR) is higher than the interest rate. For ₹5 lakh at 13% over 4 years:
| Processing fee | Fee incl. GST | Money in hand | APR |
|---|---|---|---|
| 0.5% + GST | ₹2,950 | ₹4,97,050 | 13.32% |
| 1.75% + GST | ₹10,325 | ₹4,89,675 | 14.13% |
| 3% + GST | ₹17,700 | ₹4,82,300 | 14.96% |
Every lender must show the APR and total repayable amount in the Key Fact Statement before you sign. Compare offers on that figure, not on the headline rate. At a 1.75% fee, this loan's APR is about 14.13%.
Can you afford this EMI?
Lenders usually keep all your EMIs together within about 40% to 50% of net monthly income. For an EMI of ₹13,414 with no other loans, that means a take-home income of at least ₹27,000 at the 50% limit, and about ₹34,000 to stay within a more comfortable 40%. Existing EMIs, including credit card EMIs, reduce what is left for this one.
Get contractor quotes before applying and add a buffer of about 10% for overruns, so you do not need a second, more expensive loan halfway through the work.
Prepay to cut the interest
Paying a lump sum towards the principal reduces the interest for the rest of the loan. On ₹5 lakh at 13% over 4 years, a part-prepayment of ₹50,000 after the first year:
- with the EMI kept at ₹13,414, closes the loan about 5 months early and saves roughly ₹21,972 of interest;
- with the tenure kept, cuts the EMI to about ₹11,729 and saves roughly ₹10,649 of interest.
Keeping the EMI and shortening the tenure saves more. Floating-rate loans to individuals cannot carry prepayment charges; fixed-rate loans may, so check your agreement first.
How home renovation loan EMI is calculated
Lenders use the reducing-balance formula: EMI = P × R × (1 + R)N ÷ ((1 + R)N − 1), where P is the loan amount, R is the yearly rate divided by 12 and by 100, and N is the number of monthly instalments.
For ₹5 lakh at 13% over 48 months, R is 0.010833 and the EMI comes to ₹13,414. In the first month, ₹5,417 of it is interest and ₹7,997 repays principal. Each month the balance falls, so the interest part shrinks and the principal part grows. In the first year you pay about ₹59,070 in interest, which is 37% of what you pay in that period. The year-by-year schedule in the calculator shows the full split.
Before you apply for a home renovation loan
The calculator tells you what the loan costs. Before you apply, check whether you qualify, what documents lenders ask for and the mistakes borrowers most often make.
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Home Renovation Loan EMI: frequently asked questions
What is the EMI for a home renovation loan of ₹5,00,000?
At 13% a year for 4 years, the EMI is ₹13,414 and the total interest is ₹1,43,860. Over 3 years the EMI rises to ₹16,847 but the interest falls to ₹1,06,491.
How is home renovation loan EMI calculated?
With the reducing-balance formula EMI = P x R x (1+R)^N / ((1+R)^N - 1), where R is the monthly rate and N the number of months. Interest is charged only on the balance still outstanding, so the interest part of each EMI falls over time.
Does the home renovation loan EMI include the processing fee?
No. The EMI covers interest and principal. The processing fee, usually around 0.5% to 3% of the amount plus 18% GST, is generally deducted upfront. Use the APR in the Key Fact Statement to compare total cost.
What happens to my home renovation loan EMI if the rate rises by 1%?
On ₹5,00,000 over 4 years, a 1% rise takes the EMI from ₹13,414 to ₹13,663 if the tenure is kept. If the lender keeps the EMI instead, the tenure stretches. You can ask the lender to choose a higher EMI.
How can I reduce my home renovation loan EMI?
Choose a longer tenure, borrow less, or get a lower rate by improving your credit score or comparing lenders. A longer tenure lowers the EMI but raises the total interest, so pick the shortest tenure you can comfortably afford.
Is the rate in this calculator my actual home renovation loan rate?
No. 13% is an example within the indicative range of about 9% to 24%. Your rate depends on the lender, your credit score, income and the loan details. Enter the rate in your own offer for an exact EMI.
Does prepaying a home renovation loan save money?
Yes. Here, prepaying ₹50,000 after one year saves roughly ₹21,972 of interest if you keep the EMI. Floating-rate loans to individuals cannot carry prepayment charges; fixed-rate loans may.
Rates, fees and limits are indicative ranges for India, reviewed on the date above. KhatuLoans is not a lender and does not decide approval or pricing. Read our editorial policy and how we make money.
Official sources and further reading
These guides are written from Reserve Bank of India rules and official scheme pages. Rules, rates and scheme terms change, so check the current position on these sites and in your lender's Key Fact Statement before you apply.
- RBI: Key Facts Statement (KFS) for loans and advances. The Reserve Bank of India notification that tells lenders to give every borrower a plain-language statement of the full cost of a loan.
- RBI Complaint Management System. Where to take a complaint against a bank, NBFC or other regulated lender if the lender does not resolve it.
- RBI (Pre-payment Charges on Loans) Directions, 2025. Bars pre-payment charges on floating-rate loans taken by individuals for non-business purposes, for loans sanctioned or renewed from 1 January 2026.
- Reserve Bank - Integrated Ombudsman Scheme, 2021. The single complaint scheme for customers of banks, NBFCs and other RBI-regulated lenders.
- RBI: Free Annual Credit Report to Individuals. Credit bureaus must give you one free full credit report with score every calendar year.
- RBI Financial Education. Consumer guidance from the Reserve Bank of India on borrowing, fraud and your rights as a customer.
Edited by Hemant Kumar. Rates on this site are indicative ranges, not offers.