How is a Pakistan mortgage instalment calculated?

It uses the standard amortising formula M = P x r(1+r)^n / ((1+r)^n - 1), where P is the loan, r is the monthly rate (annual rate divided by 12) and n is the number of months. Each instalment pays interest first, with the remainder cutting the balance.

What interest rates apply to home loans in Pakistan?

HBFC offers fixed-rate products historically around 16%, while commercial banks price floating loans at KIBOR plus a spread, often landing at roughly 18-22% per year. Subsidised Mera Pakistan Mera Ghar loans carried much lower 5-7% tiers. Enter the rate your lender quotes.

How much deposit do I need in Pakistan?

Lenders typically finance up to about 80-85% of the property value, so you usually need a deposit of at least 15-20%. A bigger deposit lowers your loan-to-value ratio and can improve the rate you are offered.

What is the income stress test?

Banks usually require your monthly instalment to stay within roughly 35-50% of your net monthly income (debt-to-income ratio). This tool flags whether your instalment fits within a 40% threshold of the income you enter, as a guide.

Does this calculator store my data?

No. Everything is computed locally in your browser and nothing is uploaded, so your financial details stay private.

Pakistan Mortgage Calculator

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This Pakistan mortgage calculator estimates your monthly home-loan instalment, total interest, loan-to-value (LTV) ratio, and runs an affordability stress test based on the income you enter. It reflects how HBFC, commercial KIBOR-linked, and Mera Pakistan loans are priced.

How it works

The instalment uses the standard amortising annuity formula:

M = P x r (1 + r)ⁿ / ((1 + r)ⁿ − 1)

where P is the loan amount (price minus deposit), r is the monthly rate (annual ÷ 12 ÷ 100) and n is the term in months. The tool also computes:

LTV = loan ÷ property price, which lenders usually cap near 80-85%.
Stress test — flags whether the instalment stays within 40% of your net monthly income, a typical debt-to-income guide.

Example

Buy a PKR 20,000,000 home with a PKR 4,000,000 deposit (LTV 80%) at 20% over 20 years. The PKR 16,000,000 loan at a 1.667% monthly rate gives an instalment of roughly PKR 271,000 per month.

Notes

Commercial loans are usually floating (KIBOR plus a spread), so your rate and instalment can change at each reset — this tool models a fixed rate for the whole term as an estimate. Subsidised schemes like Mera Pakistan Mera Ghar carried far lower tiers when active. Processing fees, takaful/insurance and legal costs are excluded. Confirm terms with your bank or HBFC.