Two down payment scenarios, the same home
For a ₹50 lakh home, an 80% LTV offer means a ₹40,00,000 loan with a ₹10,00,000 down payment. Choosing a smaller 70% LTV instead means a ₹35,00,000 loan with a ₹15,00,000 down payment — ₹5,00,000 more upfront.
What that ₹5 lakh does to the EMI
Running both loan amounts through the same 8.5% rate and 240-month tenure: the ₹40,00,000 loan carries an EMI of ₹34,712.93, while the ₹35,00,000 loan carries an EMI of ₹30,373.81 — a difference of ₹4,339.12 every month, for the life of the loan.
Why a smaller percentage change in the loan produces a real EMI difference
The loan amount dropped by ₹5,00,000, which is 12.5% of the original ₹40,00,000 loan. Since EMI scales roughly proportionally with principal (for the same rate and tenure), a similarly-sized drop shows up in the EMI — a meaningful, ongoing saving from a one-time larger down payment.
The trade-off to weigh
A larger down payment permanently lowers the EMI and the total interest paid over the loan's life, but it also ties up more cash upfront that could otherwise go toward an emergency fund or other investments — the right balance depends on both the loan math shown here and priorities the calculators alone can't capture.