How much EMI can I afford on my salary?

Last checked: 12 November 2026. Rates, fees and rules change; check the linked sources before you act.

The most common mistake in buying a home is letting the loan offer set the budget. A lender tells you the most it is willing to lend; it does not tell you what you can comfortably pay for twenty years. The better question comes first: what EMI can my household carry without strain, even in a bad year?

Start from take-home pay

Write down what actually reaches your bank account each month, after tax, provident fund and other deductions. Then list the costs that will not go away when you buy:

• existing EMIs, such as a car or personal loan;
• school fees, insurance premiums and support for parents;
• groceries, utilities, transport and phone;
• a regular saving or investment you do not want to stop;
• the new costs of owning: maintenance, property tax and repairs.

What is left is the most you could put towards a home loan. The EMI you choose should sit comfortably below it, so that a medical bill or a delayed bonus does not push you into missing a payment.

The debt-service share, used carefully

Lenders often look at what share of your income goes to all loan repayments, sometimes called a debt-service or FOIR limit. There is no single official number, and each lender sets its own. In our calculators the share is an editable personal assumption, not a lender rule. As an illustration only, a 50% share of take-home pay works like this at an assumed 8.5% over 20 years (Showcasia affordability example, checked 12 November 2026):

• Take-home ₹1 lakh a month, no other loans: EMI budget ₹50,000, supporting a loan of about ₹57.6 lakh.
• Take-home ₹1.5 lakh a month, a ₹10,000 car EMI: EMI budget ₹65,000, supporting a loan of about ₹74.9 lakh.
• Take-home ₹2 lakh a month, no other loans: EMI budget ₹1 lakh, supporting a loan of about ₹1.15 crore. Figures from the Showcasia affordability example, checked 12 November 2026.

Many households find half of take-home pay too much once school fees and parents' needs are counted. Treat the share as a slider to test, not a target to reach.

Stress-test the rate

Many home loans in India are on a floating rate, so the EMI can rise. Before you settle on a budget, check what happens if rates go up. On a ₹60 lakh, 20-year loan the EMI is about ₹52,069 at 8.5%, about ₹55,928 at 9.5% and about ₹59,903 at 10.5% (Showcasia affordability example, checked 12 November 2026). If the higher figure would break your budget, borrow less. Lenders may extend the tenure instead of raising the EMI, which protects the monthly budget but adds interest; our guide to tenure versus EMI shows how much.

From EMI to a price range

Once you have an EMI you trust, turn it into a home price:

1. Convert the EMI into a loan amount with the standard EMI formula, as above (HDFC Bank EMI formula, checked 12 November 2026).
2. Add your down payment. Lenders do not finance the whole price, so you need your own contribution.
3. Subtract the one-off costs. Stamp duty, registration, legal fees, brokerage and moving all come out of your savings, not the loan.
4. Keep a reserve. Leave several months of expenses untouched after the purchase.

The price you can pay is the loan plus the down payment, minus those one-off costs from your savings. The total cost of buying calculator adds them up for you.

Signs your EMI is too high

• You would need to stop saving entirely to pay it.
• One partner losing income for three months would mean missed payments.
• You are counting on a raise or bonus that has not happened yet.
• A rate rise of one or two points would leave nothing spare.

If any of these apply, look at a smaller loan, a longer search, a different locality or a home that needs less work.

Try your own numbers

Start with the home affordability calculator, then compare it with the home loan eligibility estimate to see the gap between what you can afford and what a lender might offer. The EMI calculator checks any single loan. With a budget in hand, browse flats for sale in Chennai or flats for sale in Bengaluru. For the maths behind every figure here, read how EMI is calculated, and find more guides in the EMI and prepayment topic.

Questions people ask

Sources

1. Reproduce the Showcasia affordability example, Showcasia, checked 12 November 2026.
2. Reproduce the Showcasia EMI example, Showcasia, checked 12 November 2026.
3. Home loan EMI formula and calculator, HDFC Bank, checked 12 November 2026.

This is general information, not legal, tax or financial advice. Check with a qualified professional for your case.