Business Loan Calculator

This calculator models a fixed-rate, fully amortizing business term loan. It uses the level-payment formula M = P × i(1+i)^n ÷ ((1+i)^n − 1), where P is the amount borrowed, i is the annual note rate divided by 1,200, and n is the number of monthly payments. At a zero rate, the payment is principal divided by the term. The total interest shown is the rounded monthly payment multiplied by the number of months minus principal, and total cost adds the upfront fees you enter. Amount is the principal used by the modeled loan. Rate is the note rate that prices interest in this scenario, not necessarily the APR disclosed for comparison. Months is the repayment term. Fees are shown in total cost but are assumed to be paid separately; if a lender finances an origination fee, include it in the amount borrowed instead. The estimate does not add collateral, guarantees, taxes, insurance, payroll, or operating costs to the payment. Each level payment contains interest and principal. Early payments generally contain more interest because the outstanding balance is largest. As principal falls, the interest portion falls and the principal portion rises. This calculator reports the aggregate interest, not a month-by-month table. Ask the lender for the complete amortization schedule and confirm payment frequency, first-payment date, day-count convention, prepayment terms, and any balloon or interest-only period. The Small Business Administration explains that businesses should compare funding sources and understand their terms. A loan with a lower nominal rate can still be more expensive if it has larger fees, a longer term, a required service, or a balloon payment. Origination fees and other finance charges can make the APR higher than the note rate. This page does not calculate a legally compliant APR because it does not know every finance charge, timing rule, or jurisdictional disclosure requirement. Use the lender’s APR and disclosure for offer comparison. A business payment should be tested against conservative cash flow after payroll, taxes, inventory, rent, insurance, and an operating reserve. Underwriting may use business and personal credit, collateral, guarantees, debt-service coverage, and documented financial statements. Approval is not implied by a positive cash-flow scenario. Use the personal loan calculator for an individual fixed loan and the debt consolidation calculator when the question is replacing several balances. Common mistakes include entering APR as the note rate while also ignoring fees, extending a term only to reduce the monthly payment, and assuming a variable-rate or seasonal loan follows this schedule. Save the term sheet assumptions and rerun the calculation when the amount, rate, term, fees, payment frequency, or repayment structure changes. A lender’s amortization schedule should reconcile the payment, principal, interest, and final balance. If it does not, check whether the offer contains a balloon, interest-only period, daily interest, or financed fee. The calculator is most useful before signing, when you can compare the full term sheet and test a payment against conservative operating cash flow. Keep business and personal obligations visible when assessing affordability, even if the lender presents only one required payment.