How to Calculate Loan Against Property EMI?

What is a Loan Against Property?

A loan against property (LAP) is a type of secured loan where the borrower’s property is used as collateral. This loan type is popular due to its lower interest rates and flexibility in usage.

Working Mechanism of a Loan Against Property

In a LAP, the lender provides you with funds equivalent to a certain percentage of your property’s market value. This loan must be repaid over a specified term in the form of Equated Monthly Installments (EMIs).

Understanding EMI

EMI or Equated Monthly Installment is the amount paid by the borrower to the lender each month. It includes both the principal amount and interest accumulated.

Calculating Loan Against Property EMI 

The EMI for any loan depends on three main factors – the loan amount, the rate of interest, and the loan tenure. The formula to calculate the EMI is: EMI = [P x R x (1+R)^N]/[(1+R)^N-1] Where P represents the loan amount R is the monthly interest rate (annual rate of interest/12/100) N denotes the loan tenure in months


Let’s assume you’ve taken a LAP of ₹20 lakhs for a tenure of 15 years, with an annual interest rate of 11%. 

Using the formula, your monthly EMI calculation would look like this:

 EMI = [2000000 x (11/12/100) x (1+(11/12/100))^180]/[(1+(11/12/100))^180-1] ≈ ₹22,024.


1. Can I use an online EMI calculator to calculate my EMI for LAP? 

Yes, Ruloans is offering you to check your emi free of cost on their website.

2. Does the EMI for a loan against property change during the loan tenure? 

Typically, the EMI remains fixed unless there’s a change in the interest rate due to loan agreement terms or base rate modifications by the Reserve Bank of India.

Key Takeaways

EMI calculation is an essential part of your loan planning. It helps you understand your monthly obligation towards your loan and plan your finances accordingly. It is always advisable to opt for an EMI amount that you can comfortably pay without straining your finances.

Ready to Apply for a Loan Against Property? Let Ruloans Guide You!

At Ruloans, we are committed to helping you make informed decisions about your financial needs. If you’re considering a loan against property, let our team of experts guide you through the process. Start your loan journey with us today!

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