How this calculator works
The number of payments is the term in years times the payment frequency, and the payment uses the loan formula at the rate per period. The APR including the fee is the rate at which those same payments would repay only the net amount you received.
Worked example
With the example values below: Payment, $2,124.70 (60 monthly payments). Change any number above to run your own.
What you enter
| Input | Example |
|---|---|
| Loan amount | $100,000 |
| Interest rate | 10% |
| Term | 60 mos |
| Origination fee | 3% |
| Payment frequency | Monthly |
Types of business financing
This calculator covers term loans, with monthly, biweekly or weekly payments, which is how many online lenders collect.
| Type | How it works | Typical use |
|---|---|---|
| Term loan | Lump sum, fixed payments over 1–10 years | Expansion, equipment, refinancing |
| SBA loan | Bank loan partly guaranteed by the SBA | Long-term needs at lower rates |
| Line of credit | Draw and repay as needed | Cash flow, seasonal inventory |
| Equipment financing | Equipment secures the loan | Vehicles, machinery, technology |
| Merchant cash advance | Advance repaid from card sales | Fast cash; usually very expensive |
Understanding the true cost
Business lenders quote prices in different ways: interest rates, APRs, factor rates and fees. An origination fee deducted from the loan raises the effective cost, which is why the calculator shows APR including the fee.
Factor rates are common on short-term loans and cash advances. A 1.3 factor on $50,000 means you repay $65,000. Over six months, that's an APR far above 50%, much higher than the factor rate suggests.
What lenders look at
- Time in business, often at least one or two years for banks.
- Annual revenue and cash flow, usually from bank statements and tax returns.
- Personal and business credit scores.
- Debt service coverage ratio, cash flow divided by debt payments, often 1.25 or higher.
- Collateral and a personal guarantee from owners.
Choosing the right loan
Match the loan term to what you're financing: short-term needs with short-term credit, long-lived assets with longer loans. Compare total cost, not just the payment, and make sure payments fit your slowest months. If you qualify, an SBA loan usually offers longer terms and lower rates than online lenders.
Frequently asked questions
How do you calculate a business loan payment?
Use the standard loan formula with the rate per payment period and the number of payments. Weekly payments use the annual rate divided by 52 and 52 payments a year.
What is a factor rate?
A multiplier used on short-term business loans and cash advances. A 1.25 factor on $40,000 means repaying $50,000. Because repayment is quick, the equivalent APR is often very high.
What credit score do I need for a business loan?
Banks and SBA lenders often look for personal scores of 680 or higher. Online lenders may accept 600 or lower but charge much higher rates.
Do I need collateral for a business loan?
Many lenders require collateral or a blanket lien on business assets, plus a personal guarantee. Some unsecured options exist but usually cost more.
Is business loan interest tax-deductible?
Generally yes, as a business expense, when the money is used for business purposes. Larger businesses may face limits on deducting interest; ask a tax professional.
Grow what this calculator projects.
TruthSayer AI sends quantitative stock signals across valuations, earnings and dark-pool activity, each one traded in its own funded account first.
Estimates for planning only, not financial, tax or legal advice. Tax tools use 2026 federal figures (brackets, $16,100 / $32,200 standard deduction, $19,000 gift exclusion, $15M lifetime exemption). Rates shown as defaults are examples; replace them with quotes you actually receive.