Calculator Inputs
Example Data Table
| Scenario | Net Income | Existing Obligations | FOIR Cap | Max New EMI |
|---|---|---|---|---|
| Early career | PKR 120,000 | PKR 18,000 | 45% | PKR 36,000 |
| Family budget | PKR 250,000 | PKR 65,000 | 50% | PKR 60,000 |
| High income, high rent | PKR 400,000 | PKR 160,000 | 55% | PKR 60,000 |
Examples are illustrative and not financial advice.
Formula Used
Loan amount = EMI × (1 − (1 + r)−n) ÷ r
If rate is 0%, loan amount ≈ EMI × n.
How to Use This Calculator
- Enter your monthly income and any other recurring income.
- Add estimated taxes, deductions, and an optional income haircut.
- Fill in existing obligations: EMIs, rent, card minimums, and others.
- Choose your FOIR cap and add a safety buffer if needed.
- Optionally enter rate and tenure to estimate maximum loan size.
- Press calculate to view results and download reports.
FOIR as a credit affordability guardrail
FOIR (Fixed Obligation to Income Ratio) limits how much of your income can be committed to debt. Many lenders use caps between 35% and 60%. This calculator applies the cap to estimated net income, then allocates that capacity across current and new EMIs. If net income is PKR 251,500 and the cap is 50%, total allowable obligations are PKR 125,750; at a 40% cap, the ceiling becomes PKR 100,600.
Building a realistic net income base
Start with gross income and other income, then apply conservative adjustments. Example: gross PKR 250,000 plus other PKR 20,000 equals PKR 270,000. With a 0% haircut, 5% tax, and PKR 5,000 deductions, estimated net income becomes PKR 251,500. If you haircut income by 10% to reflect variable earnings, the same profile drops to about PKR 225,850, reducing allowable obligations at 50% FOIR to PKR 112,925.
Obligations that lenders usually count
FOIR commonly includes existing EMIs, credit card minimum payments, housing costs, and other mandatory commitments reported to lenders. Using the sample inputs: EMIs PKR 45,000, card minimums PKR 8,000, rent PKR 30,000, and other obligations PKR 7,000 total PKR 90,000 per month. Some policies add assumed payments for unused limits.
Safety buffer and approval comfort
Maximum new EMI equals allowable obligations minus existing obligations. With PKR 125,750 allowable and PKR 90,000 existing, raw headroom is PKR 35,750. Applying a 10% safety buffer reduces the suggested safe EMI to about PKR 32,175, and the resulting FOIR becomes roughly 48.6%, leaving room for shocks. A larger buffer improves comfort but reduces eligibility.
Translating EMI into loan size
Once you have a safe EMI, convert it into an estimated loan amount using rate and tenure. For 22% annual rate and 60 months, a PKR 32,175 EMI corresponds to roughly PKR 1.16 million principal. At 18%, eligibility rises to about PKR 1.27 million; at 26%, it drops near PKR 1.07 million. Longer tenures increase principal eligibility, but they also increase total interest paid.
FAQs
What does FOIR represent in lending decisions?
FOIR is the share of your net monthly income used for fixed obligations, including EMIs and required payments. Lenders use it to ensure you can service debt without excessive financial stress.
Which income figure should I enter for best accuracy?
Use stable, verifiable monthly income. If bonuses or business income fluctuate, enter an average and apply an income haircut so the result remains conservative during document verification.
Do I need to include rent or housing costs?
Yes, if rent is a regular commitment or if your lender’s policy treats housing as an obligation. Including it gives a more realistic estimate of how much EMI capacity remains.
How do I choose a safety buffer?
A 5%–15% buffer is common for planning. Use a higher buffer if your expenses vary, rates may change, or you want more comfort. Use a lower buffer only if cashflow is very stable.
Why is my maximum new EMI showing as zero?
Your existing obligations may already exceed the FOIR cap, or your estimated net income may be too low after taxes and deductions. Reduce obligations, adjust inputs, or select a different FOIR cap.
Will the loan amount estimate match the bank’s final offer?
It is an estimate based on the entered rate and tenure. Actual eligibility can change due to fees, insurance, credit score, policy caps, and how the lender calculates income and obligations.