Ans: EMI calculation can be made in two ways i.e., the flat balance or reducing balance interest method. If the interest amount payable is based on the entire loan amount for the full duration of loan repayment, the EMI amount will not change during the tenure. This implies that the flat balance method was used for calculating the EMI. However, in the case of reducing the balance interest rate method, the interest is calculated on the principal amount that is leftover or outstanding each time instead of the complete amount borrowed. When availing of a home loan, you as a borrower must check which method is used to calculate your EMI amount.