Education Loan Calculator with Moratorium Period
Simulate course duration and post-graduation grace periods. Compare interest capitalization vs paying simple interest during college to minimize debt.
Explore specialized student loan simulators, moratorium calculators, government subsidies, tax deductions, and bank presets:
⏳ Moratorium Mechanics: Capitalization vs Monthly Servicing
Interest accumulates and adds to principal upon graduation. You pay interest on interest for 10–15 years.
Pay small interest monthly while studying. Qualify for 1% bank discount and start repayment on original principal.
Loan & Moratorium Details
💡 Pro Tip for Students & Parents:
Paying the small monthly interest during the moratorium avoids capitalization and saves thousands!
Amortization Schedule
Interactive breakdown of balance, interest, and prepayment impact
| Period | EMI Paid | Principal Paid | Extra Prepayment | Interest Paid | Total Payment | Remaining Balance |
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Frequently Asked Questions
What is a moratorium period in an education loan?
A Moratorium Period (or holiday period/grace period) is the time during which the student is studying plus an additional 6 to 12 months after graduation before regular monthly EMIs become mandatory. During this time, banks charge simple interest on the disbursed amounts.
What happens if I don't pay anything during the moratorium?
If no payments are made, the simple interest accrued during your studies is Capitalized (added directly to your principal balance) at the end of the moratorium. Future compound interest and monthly EMIs are then calculated on this higher combined amount.
How much can I save by paying simple interest during college?
Paying just the simple interest monthly during college (or making small $50–$100 part-payments) stops interest from capitalizing, reducing your post-graduation monthly EMI by 15% to 25% and saving substantial compound interest over the full repayment term.
Do banks give interest concessions for paying during the moratorium?
Yes! Major lenders (including SBI, Canara Bank, and Bank of Baroda) offer a 1.00% interest rate concession for the entire loan tenure if the borrower services interest regularly during the moratorium period.