Business Loan Calculator
Adjust the inputs below. Results update as you type.
How it works
Uses the same amortizing payment formula as personal loans: PMT = PV × r / (1 − (1+r)^−n). Business loans may have origination fees (1–5%), prepayment penalties, or balloon structures not captured here. SBA 7(a) loans cap at prime + 2.75% for terms over 7 years. Factor in the opportunity cost of collateral and personal guarantees.
Input guidance
- Use realistic rates from lender or provider quotes instead of headline averages.
- Model conservative, baseline, and optimistic scenarios before deciding.
- Include recurring real-world costs (fees, taxes, insurance, maintenance) where relevant.
The formula
Business loans amortize with M = P · r · (1+r)^n / ((1+r)^n − 1). Some carry fees or factor rates; convert factor rates to an effective APR to compare offers fairly.
Worked example
A $100,000 business loan at 9% over 7 years costs about $1,609/month and roughly $35,200 in total interest.
More examples to test
- Conservative case: use a higher interest rate and lower growth assumptions to stress-test affordability.
- Optimistic case: use a lower rate with stable income assumptions to compare upside potential.
How to interpret results
Treat this as a planning model, not a final approval tool. Compare at least two scenarios and focus on total-cost and cash-flow trade-offs.
When this can be inaccurate
Results can diverge due to fees, changing rates, tax rules, lender policies, and behavior changes that simplified models cannot fully capture.
Change history
- July 2026: Quality-reviewed for publication with formula checks and explanatory copy updates.
Site-wide corrections also appear on the corrections log.
Frequently asked questions
What is a factor rate?+
Some short-term business financing quotes a factor (e.g., 1.3) instead of APR. Total repayment = amount × factor, which often implies a very high effective APR.
What affects my rate?+
Business credit, time in operation, revenue, collateral, and loan type. Established, profitable businesses get the best rates.
Secured or unsecured?+
Secured loans pledge collateral for lower rates; unsecured loans cost more but do not risk specific assets if the business struggles.
How should I use this result?+
Treat it as a planning estimate. Compare at least two realistic scenarios, then confirm with statements, quotes, or a qualified professional before acting.
How often should I refresh assumptions?+
Refresh whenever rates, income, costs, or policy limits change materially, and before making irreversible commitments.