Business Loan Calculator
Enter your loan amount, interest rate, and term to see your monthly business loan payment — plus the true APR and total cost once origination and closing fees are counted. Works for term loans, SBA loans, equipment financing, and commercial loans. Add your monthly business income to check whether the payment clears the debt-service coverage ratio lenders look for, and try an extra monthly payment to see the interest you'd save.
Quick examples (illustrative numbers only):
The amount you're borrowing (face value) — works for term loans, SBA loans, equipment financing, and commercial loans. If your purchase needs a down payment, enter the amount you'll actually borrow
The nominal fixed annual rate your lender quotes — add fees below and we'll solve the true APR
The lender's one-time fee for making the loan, usually a percent of the amount
Documentation, closing, packaging, or an SBA guaranty fee — enter the dollar total from your quote
Enter a fee above to choose how it's charged
Added to every monthly payment — on 7–25-year terms, modest extra principal saves serious interest; see exactly how much below
Average monthly revenue minus operating expenses, before this loan's payments — used only for the debt-service coverage (DSCR) check, never the loan math
Loan Summary
Monthly Loan Payment
True APR (incl. fees)
Cash Received at Closing
Total Interest
Total Cost of Borrowing
Payoff Date
Amortization Breakdown
(120 payments)Showing yearly rows because this loan runs more than 60 months.
Remaining balance over time
Where the total cost goes
Yearly Schedule
| Year | Payment | Principal | Interest | Balance |
|---|---|---|---|---|
| 1 | $15,201.09 | $6,463.39 | $8,737.70 | $93,536.61 |
| 2 | $15,201.09 | $7,069.70 | $8,131.39 | $86,466.91 |
| 3 | $15,201.09 | $7,732.89 | $7,468.20 | $78,734.02 |
| 4 | $15,201.10 | $8,458.29 | $6,742.81 | $70,275.73 |
| 5 | $15,201.10 | $9,251.74 | $5,949.36 | $61,023.99 |
| 6 | $15,201.09 | $10,119.61 | $5,081.48 | $50,904.38 |
| 7 | $15,201.09 | $11,068.90 | $4,132.19 | $39,835.48 |
| 8 | $15,201.09 | $12,107.23 | $3,093.86 | $27,728.25 |
| 9 | $15,201.10 | $13,242.99 | $1,958.11 | $14,485.26 |
| 10 | $15,201.09 | $14,485.26 | $715.83 | $0.00 |
| Total | $152,010.93 | $100,000.00 | $52,010.93 | $0.00 |
Related Calculators
How This Calculator Works
A business term loan — whether it's an online loan, a bank loan, an SBA 7(a), or commercial real estate financing — is a fixed-rate, fully amortizing installment loan. You borrow a lump sum, repay it in equal monthly payments, and the split between interest and principal shifts month by month. What makes business loans different from consumer loans is the fees: origination and closing fees change what you actually receive and what the loan really costs, which is why this calculator solves a true APR instead of just echoing your quoted rate.
The Payment Formula
M = P · i(1 + i)ⁿ / ((1 + i)ⁿ − 1)
P is the amortized principal (your loan amount, plus fees if they're financed), i is the monthly rate (APR ÷ 12), and n is the term in months. Payments are equal, end-of-month, and fully amortizing — early payments are mostly interest, later ones mostly principal. At 0% APR the formula simplifies to M = P ÷ n — the balance split evenly across the term.
The True APR Solve
PV(payments at i*) = cash you net at closing
Fees mean you either receive less than you repay (deducted or paid upfront) or repay more than you received (financed). The calculator finds the rate that reconciles the two — the same actuarial method behind Truth-in-Lending APR disclosures — so offers with different fee structures become directly comparable. When fees are $0, the true APR equals your interest rate exactly.
The three fee treatments each change the picture differently. Deducted from proceeds (typical for online lenders): you repay the full loan amount but receive less at closing. Financed into the loan (common for SBA guaranty fees): you receive the full amount but the fees grow your balance and your payment. Paid upfront: you receive the full amount and write a separate check at closing. All three raise the true APR above the nominal rate; the toggle shows how each affects the payment, the cash you receive, and the upfront cash you need.
The optional DSCR check divides your annual net operating income by the loan's annual payments. Lenders commonly want at least 1.25 — $1.25 of income per $1.00 of debt service — and they count all your business debt, so treat this single-loan figure as a floor, not a guarantee. For terms, use your product as a guide: online term loans often run months to about 3 years, bank term loans 1–10 years, and SBA 7(a) loans up to 10 years for working capital or equipment and 25 years for real estate.
Excluded by design: variable rates, balloon payments, interest-only periods, draw fees, prepayment penalties, and factor-rate advances (the FAQ explains how to convert a factor rate for comparison). Results are estimates, not financial or lending advice.
Smart Business Borrowing Strategies
Compare True APRs, Not Sticker Rates
A 9% loan with a 5% deducted origination fee costs meaningfully more than a 10% loan with no fees — but the sticker rates say the opposite. Enter each offer's rate, term, and fees exactly as quoted and compare the true APR outputs. It's the only number that puts differently structured offers on the same footing.
Size the Loan Off Net Proceeds, Not Face Value
If your lender deducts fees from proceeds, a "$100,000 loan" doesn't wire you $100,000. When you need a specific amount of usable cash, increase the loan amount until the cash received at closing output hits your target — otherwise you'll come up short on day one and pay interest on money you never got to use.
Check Your DSCR Headroom
Enter your monthly net operating income and aim for comfortable clearance above the 1.25 benchmark, not a bare pass. Lenders underwrite against all your business debt and your income fluctuates; a DSCR that only just clears 1.25 in a good month can dip below 1.0 in a slow quarter. If the badge reads tight, consider a longer term or a smaller loan.
Model Extra Payments on Long Terms
On a 10-to-25-year SBA or commercial term, even a modest extra monthly payment saves five figures of interest and shaves years off the payoff. Enter an extra amount and check the interest saved and time saved outputs — then weigh that return against what the same cash could earn deployed in the business.
Watch for Prepayment Penalties
Unlike most consumer loans, business loans sometimes charge for early payoff — yield maintenance on commercial mortgages, declining prepayment fees on SBA loans over 15 years, or flat penalties on online term loans. Before you commit to an aggressive prepayment plan, read the prepayment clause in your agreement; a penalty can erase much of the interest savings.
Use Cost per Dollar for Quick Comparisons
The cost-per-dollar-borrowed readout compresses the whole deal — interest plus fees — into one intuitive figure: what you pay for every $1 you borrow. It's especially handy when comparing a short expensive loan against a long cheap one, or a term-loan quote against a converted factor-rate offer.
Common Business Borrowing Scenarios
Online Term Loan for Working Capital
$50,000 · 3 years · 5% fee deductedA $50,000 online term loan over 3 years with a 5% origination fee deducted from proceeds. Enter the quote and see the number most borrowers miss: you receive $47,500, not $50,000, and the true APR lands well above the quoted rate. Compare it against a slower bank offer with lower fees to see which really costs less.
SBA 7(a) Loan with a Financed Guaranty Fee
$350,000 · 10 years · fees financedA $350,000 SBA 7(a) loan over 10 years, with the guaranty fee from your quote entered in dollars and set to financed — the common SBA structure. The calculator shows the payment on the grown balance, the true APR including the fee, and (with your monthly income entered) whether the deal clears the 1.25 DSCR benchmark SBA-style underwriting looks for.
Equipment Financing Matched to Useful Life
$120,000 · 7 years · DSCR checkA $120,000 equipment loan over 7 years — roughly the machine's useful life. Enter your monthly net operating income to confirm the payment fits, then test an extra monthly payment: retiring the loan before the equipment ages out means you're never paying for a machine that's already depreciated away.
Commercial Real Estate Purchase
$500,000 · 25 years · fees upfrontA $500,000 commercial mortgage over 25 years with closing costs paid upfront. The long term makes the monthly payment manageable, but the total interest figure is startling — flip between 20 and 25 years and watch the total cost of borrowing move by six figures, then use the extra-payment field to claw some of it back.
What This Calculator Assumes
To keep the results deterministic and evergreen, the math relies on a few standard assumptions. Understanding them helps you interpret the numbers correctly:
- •Fixed-rate ordinary annuity: Payments are equal, made at the end of each month, at a fixed APR, and fully amortize the loan to exactly $0. Variable-rate, balloon, and interest-only structures are not modeled.
- •Monthly compounding: The periodic rate is APR ÷ 12, and interest accrues each month on the outstanding balance — the standard convention for amortizing business term loans.
- •One-time fees at closing: Origination and other fees are charged once, at funding, under the treatment you select. No ongoing servicing, draw, or maintenance fees are modeled — if your product has them, they're on top of these numbers.
- •Single-loan DSCR: The coverage ratio divides your net operating income by this loan's payments only. Lenders count all your business debt, so your underwritten DSCR will be equal to or lower than the figure shown here.
- •Monthly payments only: Weekly and daily payment products and factor-rate advances (merchant cash advances) are not modeled — see the FAQ for converting a factor rate to an approximate APR for comparison.
- •Your numbers, not ours: The rate and fees are all user-supplied, and the presets are purely illustrative. Nothing here reflects current market rates, SBA fee tables, or any specific lender's terms — always compare against real quotes.
Disclaimer: Results are estimates for planning purposes, not financial, tax, or lending advice. Actual offers depend on your business's revenue, time in operation, credit profile, and the lender; fee structures and prepayment terms vary by product. Business loan interest is generally a deductible business expense, but tax treatment depends on your situation — confirm the numbers with your lender and an accountant before committing.
Frequently Asked Questions
How is a business loan payment calculated?
Fully amortizing business loans use the standard installment formula M = P·i(1+i)ⁿ / ((1+i)ⁿ − 1), where P is the amortized principal, i is the monthly rate (APR ÷ 12), and n is the term in months. Every payment is the same size, but early payments are mostly interest and later ones mostly principal — the amortization table below the results shows the exact split for every month. If your fees are financed, P is the loan amount plus fees; otherwise it's the loan amount itself. At 0% interest the payment is simply the principal divided by the number of months.
What's the difference between the interest rate and the APR on a business loan?
The interest rate is what the lender charges on the outstanding balance; the APR is the all-in annual cost once one-time fees are counted, so it's the better number for comparing offers. A “$100,000 loan at 9%” with a 5% origination fee deducted from proceeds means you receive $95,000 but repay payments computed on $100,000 — an effective cost meaningfully above 9%. This calculator solves that true APR for you using the same present-value method behind Truth-in-Lending disclosures, and it equals your entered rate whenever fees are zero. When two offers have different fees, compare their true APRs, not their sticker rates.
How do origination fees actually get charged — and which treatment should I pick?
There are three common structures, and the toggle covers all of them. Online lenders usually deduct the fee from your proceeds, so a $100,000 loan with a 5% fee wires you $95,000 while you repay the full $100,000. SBA guaranty fees are often financed — added to the loan balance — so you receive your full amount but repay more. Some bank closing costs are simply paid upfront by check. All three raise your true APR; pick whichever matches your term sheet and the calculator shows the cash you'll actually receive, the payment, and the real cost side by side.
Can I use this calculator for an SBA loan?
Yes. SBA 7(a) and 504 loans are fully amortizing installment loans, so the math is identical — enter your loan amount, quoted rate, and term (7(a) terms run up to 10 years for working capital and equipment, and up to 25 years for real estate). Put the SBA guaranty fee from your quote into the "other fees" field in dollars; guaranty fees are commonly financed into the loan, so the "financed" treatment usually matches. The calculator then shows your true APR including the guaranty fee — something most SBA calculators openly skip.
What is DSCR and why do lenders care about it?
The debt-service coverage ratio is your annual net operating income divided by your annual loan payments — a measure of whether the business generates enough profit to carry the debt. A DSCR of 1.25 means $1.25 of income for every $1.00 of payments, and that level is the benchmark many lenders (including SBA-style underwriting) want to see; below 1.0 the payments literally exceed your operating income. Enter your monthly net operating income and the calculator computes the ratio with a color-coded badge. Note that lenders count all your business debt, not just this loan, so treat this single-loan figure as a best case.
What is a factor rate, and how does it compare to an APR?
Short-term products like merchant cash advances price with a factor rate — a decimal such as 1.30 — meaning you repay the advance times the factor: borrow $50,000 at 1.30 and you repay $65,000 regardless of speed. Because the fee is fixed and the balance doesn't amortize in your favor, the equivalent APR is far higher than it looks: a rough conversion is (factor − 1) ÷ term in years × 2, so 1.30 over one year is roughly a 60% APR. This calculator models amortizing loans, not factor-rate advances, but you can use that conversion to put an advance offer on the same footing as a term-loan quote. When an offer only shows a factor rate, always convert before comparing.
How long are business loan terms?
It varies widely by product. Online term loans often run from a few months to about three years; traditional bank term loans commonly run one to ten years; equipment loans are frequently matched to the equipment's useful life (often five to ten years); and SBA 7(a) loans go up to 10 years for working capital or equipment and up to 25 years for commercial real estate. Longer terms lower the monthly payment but raise total interest substantially — flip the term between a few values and watch the total cost of borrowing output to see the trade-off in dollars.
Does paying extra each month really help on a business loan?
Yes — every dollar of principal you retire early stops accruing interest for the rest of the term, and on 10-to-25-year terms the effect compounds dramatically. Turn on the extra-payment field and the calculator shows exactly how much interest you'd save and how many months earlier you'd be debt-free, with the accelerated payoff drawn against the original schedule on the chart. Two cautions: check your agreement for prepayment penalties (some business loans have them), and remember that cash pushed into prepayment isn't available as working capital — the right answer depends on what that cash could earn in the business.
Why is the cash I receive less than my loan amount?
Because with the most common online-lender structure, the origination fee is deducted from your proceeds at funding — you sign for the full amount but the wire is smaller. If you need a specific amount of usable cash, you have to size the loan up so that the post-fee proceeds hit your target. The "cash received at closing" output makes this explicit, and switching the fee treatment shows how financing the fees or paying them upfront changes the picture. Budgeting off the face value instead of the net proceeds is one of the most common business-borrowing mistakes.
What about a down payment or equity injection?
Many business purchases — real estate, equipment, business acquisitions — require you to put in some of your own money (SBA deals commonly call it an equity injection, often around 10% of the project). This calculator is loan-amount-based: enter the amount you'll actually borrow, i.e. the project cost minus your injection. That keeps the tool accurate for every loan type, including working-capital loans that have no purchase behind them at all. Your injection isn't part of the loan math, but remember to hold it out of your cash planning alongside any upfront fees.
What costs and structures does this calculator not include?
It models a fixed-rate, fully amortizing loan with monthly payments and one-time closing fees. It does not model variable or index-tied rates, interest-only periods, balloon payments, lines of credit with draw fees, weekly or daily payment schedules, factor-rate advances, prepayment penalties, or taxes (business loan interest is generally a deductible business expense — ask your accountant, we don't compute it). If your offer has any of those features, use this tool for the amortizing core and read your term sheet carefully for the rest. Results are estimates, not financial or lending advice.
Can I share or save my results?
Yes. Every input is stored in the page's URL (compressed), so you can copy the link to share an exact scenario with a partner, accountant, or lender, or bookmark it and return later — reloading restores the same numbers. You can also export a PDF of the results and the full amortization schedule, which is handy for loan-committee packets or comparing quotes side by side. None of the major business-loan calculators offer link sharing or a working export.