How to Calculate EMI – If you’re planning to buy the new Honda Amaze base variant and wondering how much you’ll need to pay every month after making a ₹1 lakh down payment, this detailed guide will help you break it down in the simplest way. Whether you’re a first-time car buyer or an experienced professional comparing finance options, understanding your monthly EMI is crucial for planning your budget.
We’ll explain what EMI is, how it’s calculated, what your monthly payment might look like for the Honda Amaze base variant, and how factors like loan tenure and interest rate affect it. You’ll also learn how to improve your eligibility, reduce interest burden, and explore alternative financing options.
How to Calculate EMI
| Feature | Details |
|---|---|
| Car Model | Honda Amaze Base Variant (Petrol MT) |
| Ex-Showroom Price | ₹8.14 lakh |
| On-Road Price (Delhi) | Approx. ₹9.12 lakh (Cardekho) |
| Down Payment | ₹1 lakh |
| Loan Amount | ₹8.12 lakh |
| Interest Rate | 9% per annum |
| Tenure | 5 years (60 months) |
| Monthly EMI (Estimated) | ₹16,860 |
| Total Payment (Including Interest) | ₹11.01 lakh |
| Official Website | Honda Cars India |
Buying a Honda Amaze base variant with a ₹1 lakh down payment is financially achievable for many buyers thanks to flexible EMI options. With an EMI of around ₹16,860 per month, it’s important to assess your income, expenses, and long-term goals before committing.
Smart financing—like negotiating lower interest rates, comparing lenders, choosing the right tenure, and improving your credit profile—can save you lakhs of rupees over the loan period. Use this guide to make an informed, confident decision.
What Is EMI and Why It Matters?
EMI (Equated Monthly Installment) is the fixed amount you pay every month to your lender to repay the car loan. It includes both:
- Principal: The actual loan amount you borrowed
- Interest: The cost of borrowing the money
When you buy a car on loan, the EMI helps you split the payment over several months instead of paying the full price upfront. That’s why calculating it accurately is essential.
Understanding the Honda Amaze Base Variant
The Honda Amaze Base Variant, also known as the 1.2L i-VTEC Petrol MT, is a popular entry-level compact sedan offering:
- Engine: 1.2L petrol with manual transmission
- Mileage: ~18.6 km/l (ARAI certified)
- Features: Dual airbags, ABS with EBD, rear parking sensors, power steering, and front power windows
With an on-road price of ₹9.12 lakh in Delhi, it becomes an affordable choice for many first-time car buyers.
How EMI Is Calculated for Honda Amaze?
To calculate your monthly EMI, we use the standard EMI formula:
EMI = [P × R × (1+R)^N] / [(1+R)^N – 1]
Where:
- P = Principal Loan Amount
- R = Monthly Interest Rate (Annual rate / 12 / 100)
- N = Tenure in Months
Assumptions for Our Calculation:
- On-Road Price: ₹9.12 lakh
- Down Payment: ₹1 lakh
- Loan Amount (P): ₹8.12 lakh
- Interest Rate (Annual): 9% ⇒ Monthly = 0.75%
- Loan Tenure (N): 60 months
Step-by-Step EMI Breakdown:
Step 1: Convert Annual Interest Rate to Monthly: 9% ÷ 12 = 0.75% or 0.0075
Step 2: Plug the Values into the Formula:
EMI = ₹8,12,000 × 0.0075 × (1+0.0075)^60 ÷ ((1+0.0075)^60 – 1)
Step 3: Calculate the EMI:
EMI ≈ ₹16,860 per month
Total Cost Analysis Over 5 Years
| Component | Amount |
|---|---|
| Loan Amount | ₹8,12,000 |
| Total EMI Paid | ₹16,860 × 60 = ₹10,11,600 |
| Interest Paid | ₹10,11,600 – ₹8,12,000 = ₹1,99,600 |
| Total Cost of Car | ₹1 lakh (Down Payment) + ₹10,11,600 = ₹11,11,600 |
Note: Actual EMI may vary depending on the lender’s interest rate and processing fees.
What If You Change the Loan Tenure or Interest Rate?
Let’s compare some common scenarios:
1. Tenure Reduced to 3 Years (36 months)
- EMI ≈ ₹25,800
- Total Interest ≈ ₹1.2 lakh
- Better for saving on interest, but higher monthly outflow
2. Interest Rate Increased to 11% (60 months)
- EMI ≈ ₹17,654
- Total Interest ≈ ₹2.8 lakh
- Higher monthly payment and more interest paid over time
Tips to Get a Lower EMI
- Increase Down Payment: Paying ₹2 lakh instead of ₹1 lakh reduces your loan amount and EMI.
- Negotiate Interest Rate: Banks and NBFCs often offer lower rates to good credit borrowers.
- Use Online EMI Calculators: Try calculators on sites like BankBazaar or Cardekho.
- Prepay When Possible: Extra payments can reduce your interest burden.
- Improve Your Credit Score: Maintain a score above 750 for better loan offers.
- Look for Festive Offers: Many banks provide discounts or 0 processing fees during festivals.
Should You Buy Honda Amaze on Loan?
Pros:
- You get the car immediately without waiting to save the full amount
- Manageable monthly payments
- Flexible repayment options
Cons:
- Total cost is higher due to interest
- Long tenure means long-term commitment
Where to Get the Best Car Loan for Honda Amaze?
Popular Lenders in India:
- SBI – SBI Car Loan
- HDFC Bank
- ICICI Bank
- Axis Bank
- Tata Capital
- Mahindra Finance
Compare offers using online aggregators to find the best rate and terms.
Alternative Financing Options
- Leasing a Car: Lower upfront costs; ideal if you plan to upgrade soon.
- Balloon EMI Plans: Lower monthly EMIs with larger final payment.
- Used Car Loans: Consider a pre-owned Honda Amaze if budget is tight.
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FAQs about How to Calculate EMI
Q1. What is the EMI for Honda Amaze with ₹1 lakh down payment?
Approx. ₹16,860 per month for a 5-year loan at 9% interest.
Q2. Can I take a loan for 100% of the on-road price?
Some banks offer 100% on-road financing, but you may get a better rate with higher down payment.
Q3. Will my EMI change if interest rates fluctuate?
If you opt for a floating interest rate, yes. Fixed-rate loans remain stable.
Q4. What credit score is required for car loans?
A credit score of 750+ improves your chances and helps secure lower interest.
Q5. Can I prepay my Honda Amaze loan early?
Yes, most lenders allow partial or full prepayment. Check for foreclosure charges.
Q6. Is it better to buy Amaze in cash or loan?
If you have surplus funds and no better investment alternative, buy in cash. Otherwise, loans offer flexibility.
