Assumptions
- Car / home loan
- FD or liquid fund
- Monthly table
Returns are assumed constant and tax is not included. Results are estimates to compare options, not financial advice. Everything is calculated in your browser; nothing you type is sent anywhere.
FAQ
How is the comparison made?
Both options use the same cash. Option one pays the outstanding principal and any foreclosure charge today. Option two invests that cash and pays each remaining EMI from it as a monthly withdrawal. If the fund pays every EMI and money is left, investing wins. If it runs out, foreclosing wins.
Why do I not need to enter the loan interest rate?
The rate is worked out from the outstanding principal, EMI and remaining months, so it matches your current schedule even after rate changes or part payments.
What is 'ahead today'?
The difference between the cash needed to close the loan and the corpus needed to pay every remaining EMI from the investment. It puts both options in today's money.
Should I include a foreclosure charge?
Yes if your lender charges one. Many fixed-rate car loans charge a percentage of the outstanding amount plus 18% GST. Check your sanction letter or loan statement.
Does it include tax?
No. Interest on FDs and gains on funds may be taxed, and some loans give tax benefits. Both are left out.