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How AffordEMI works out what you can afford in India
Two numbers drive everything on this page: the payment formula lenders use, and the share of your income they will let that payment take. For India the conservative ceiling is 40% of net monthly income across all your obligations, and a stretched approval reaches 50%. The default rate is 9.4% a year on vehicle finance and 11.5% on two-wheelers, which are market averages rather than an offer to you.
The formula
EMI = P × r × (1+r)ⁿ ÷ ((1+r)ⁿ − 1), where P is the amount financed after your down payment, r is the annual rate divided by twelve, and n is the term in months. Reducing balance, monthly rest, no balloon and no final lump sum — every instalment shown clears the debt in full by the end of the term.
Why 40% and not more
Your existing commitments come out first, so what remains is genuinely available rather than theoretical. The dashed mark on the meter sits at 20% of income, which is where most planners put the vehicle on its own, because fuel, insurance, servicing and parking are never inside the instalment. The gap between that dashed mark and the 40% line is the difference between what a lender will approve and what leaves you room to live.
Questions people ask about car finance in India
How much EMI is safe on a ₹50,000 salary in India?
On ₹50,000 in hand with no other loans, a conservative 40% ceiling puts your total EMI capacity at ₹20,000 a month. That is what a bank will underwrite, not what a planner would suggest. Keep the vehicle itself closer to 20% — around ₹10,000 — because fuel, insurance, servicing and parking are not in the EMI. At ₹20,000 a month over 60 months at roughly 9.4%, you are financing about ₹9.6 lakh, which reaches a Nexon or a Brezza with a 10% down payment.
Why is the on-road price so much higher than the ex-showroom price?
On-road adds road tax, registration, insurance and handling to the ex-showroom figure. Road tax is set by the state, so the same car costs meaningfully more in Karnataka than in Delhi or Chandigarh — the gap can run to several percent of the vehicle price. This calculator applies a state multiplier when you pick your city, because financing the on-road figure is what actually happens: banks fund the ex-showroom portion, typically to 85–90%, and the rest lands on you at delivery.
Should I take a longer tenure to lower my EMI?
A 7-year car loan lowers the monthly number and raises the total interest, and a car is a depreciating asset — stretch far enough and you owe more than the car is worth for years. Use the tenure slider to see both figures. The honest test is whether the EMI fits at 5 years. If it only works at 7, the car is above your budget, not your budget below the car.
Is a car loan or a two-wheeler loan cheaper?
Two-wheeler loans carry higher rates than car loans in India — roughly 11–12% against 9–10% — because the ticket size is small and the asset depreciates faster. The absolute EMI is still far lower. On the same ₹50,000 salary, a Splendor or an Activa uses around 4% of your safe capacity, which leaves the rest of your income intact. The calculator applies the right rate automatically depending on what you are looking at.
Where the prices come from
On-road, including road tax, registration and insurance for popular variants on sale now, curated by hand rather than scraped live. Road tax is set by the state, so the same car costs several percent more in Karnataka than in Delhi or Chandigarh. Prices move constantly — treat every figure here as a starting point and confirm with the dealer before you commit to anything.
What this page never does
- No account, no login and no email address to run a calculation.
- Your salary is never sent to a server. The maths runs entirely in your browser.
- Sharing a result encodes your inputs into the link, so you choose who sees them.
- No lending, broking or advice. See the disclosure for how this site is funded.