🇮🇳 Finance Calculator
Car Down Payment Calculator
See exactly how your down payment changes your monthly EMI and total interest - and how much you'd need to hit a target EMI.
Loan Setup
Enter a target to see the down payment required.
Monthly EMI
with ₹0 (20%) down
Down Payment
₹0
Loan Amount
₹0
Total Interest
₹0
For Target EMI
-
The 20% benchmark
Putting 20% down on a new car keeps you ahead of first-year depreciation and meaningfully cuts total interest. Most banks and NBFCs require at least 10-20% down as lending policy.
How it works.
Your down payment does three things at once: it shrinks the amount you finance, lowers your monthly EMI, and cuts the total interest you'll pay over the life of the loan. The calculator also works in reverse - enter a target EMI and it tells you the down payment needed to hit it.
Why 20% is the benchmark
A new car can lose about 15-20% of its value in the first year. If you finance the whole thing with little down, you're immediately underwater - you owe more than the car is worth - and you stay there for a year or two. A 20% down payment on a new car roughly matches that first-year drop, so you keep pace with depreciation instead of falling behind. Most banks and NBFCs also cap financing at 80-90% of the on-road price, so a 10-20% down payment is often a lending requirement, not just good practice.
How much interest a bigger down payment saves
On a ₹9 lakh car at 9.5% over 60 months, going from 10% down to 20% down cuts the loan by ₹90,000 - and saves meaningfully in interest while trimming a noticeable amount off the monthly EMI. The higher your rate, the more each extra rupee down is worth. Try both figures in the calculator to see the difference for your exact loan.
When a smaller down payment makes sense
If a manufacturer or bank is running a promotional low-rate scheme, financing more and keeping your cash can be the smarter move. The same logic applies if putting more down would wipe out your emergency fund. The one combination to avoid is a small down payment stretched over a long 7-year (84-month) tenure - that's the fastest route to being deeply underwater on the loan.
Frequently asked questions.
How much should I put down on a car in India?
Aim for 20% on a new car and at least 15-20% on a used one. This offsets the fast early depreciation so you don't owe more than the car is worth, and it lowers both your EMI and total interest. Most banks and NBFCs also cap financing at 80-90% of the on-road price, so some down payment is usually mandatory.
Is a bigger down payment always better?
It lowers your loan cost, but don't drain your emergency fund. If your loan carries a rare subsidized low rate, keeping cash for higher-return uses can make sense - just avoid a very small down payment combined with a long tenure.
Does a down payment lower my interest rate?
Sometimes. A larger down payment reduces the lender's risk (lower loan-to-value ratio), which can qualify you for a slightly better rate in addition to reducing the amount you finance.
What down payment do Indian banks and NBFCs require?
Most lenders finance up to 80-90% of the on-road price, meaning a minimum down payment of 10-20% is typically required - this isn't a soft guideline but often a hard lending policy. Putting down more than the minimum further lowers your EMI and total interest.
Can I put too much down on a car?
You can. Draining your emergency fund to make a bigger down payment is risky - if you lose income, you still need cash more than a slightly smaller loan. Once you're past 20-25% and safely ahead of depreciation, extra cash may work harder in savings, PPF/mutual funds, or paying off higher-interest debt.
Can I use my old car as the down payment (exchange)?
Yes. An exchange/trade-in's value counts toward your down payment when buying from a dealer offering an exchange bonus. Just confirm the exchange value offered against what you could realistically get selling it yourself or via a used-car platform - dealer exchange quotes are often below market value.