How are EMIs calculated for superbike loans?

The EMI or Equated Monthly Instalment for a superbike loan is calculated based on the loan amount, interest rate and repayment tenure.

The steps for EMI calculation are:

• The loan amount requested by the borrower is first considered. Superbike loans can range from ₹3 lakhs to ₹25 lakhs+, depending on the model.
• The interest rate offered by the loan provider is then applied to the loan amount. Interest rates for superbikes are generally higher than those for normal bikes and range between 10% and 22% p.a.
• The borrower fixes the loan tenure, usually between 12 months and 60 months. Longer-duration loans have higher interest outgo.
• Based on the above information, the total interest to be paid over the full tenure is calculated.
• This total interest amount is then equally divided by the number of monthly instalments as per the tenure chosen.
• This constant interest component is added to the principal loan amount divided by tenure to derive the EMI amount.

For example, if a superbike costs ₹12 lakhs, and you take a loan of ₹10 lakhs at an interest rate of 18% for a tenure of 3 years (36 months), the EMI calculation would be:

Monthly EMI: ₹36,152

Principal Amount: ₹10,00,000

Total Interest: ₹3,01,486

Total Amount: ₹13,01,486

To get a sense of EMIs, superbike buyers should use online EMI calculators by providing the above parameters before applying for a loan.