Business Loan Calculator

Calculate business loan payments, total interest, and compare SBA, term, and line of credit options. See amortization schedules and the true cost of borrowing.

Loan Type

Fixed payments over a set period. Best for established businesses with predictable needs.

Loan Amount ($)

Annual Interest Rate (%)typical: 7–25%

Loan Term (months)typical: 12–60 mo

Origination Fee (%)

Monthly Revenue ($) — for qualification estimate

Monthly Payment

$2,027.64

Term Loan · 60 months · 8% APR

Total Interest

$21,658.37

Total Cost

$122,658.37

Origination Fee

$1,000.00

Effective APR

8.43%

Payment Breakdown

82%

18%

PrincipalInterestFees

Strong Qualification

Strong position. Your DSCR is 12.33x (lenders typically want 1.25x+). Payment is 8.1% of revenue.

Cumulative Principal vs Interest

Loan Type Comparison — $100K Loan

Loan Type	Rate Range	Typical Term	Est. Payment	Total Interest
Term Loanselected	7–25%	5 yr	$2,935.13 – $1,980.12	$27,482.27
SBA 7(a)	8.5–11%	10 yr	$1,377.50 – $1,239.86	$56,924.29
SBA 504	5.5–6.5%	20 yr	$745.57 – $687.89	$71,943.45
Equipment Loan	6–16%	5 yr	$2,431.81 – $1,933.28	$24,550.13
Line of Credit	8–24%	1 yr	$9,455.96 – $8,698.84	$6,618.55

Insight

Your total interest of $21,658.37 represents 22% of the loan. Making occasional extra payments can reduce both the term and total interest.

Amortization Schedule

Month	Payment	Principal	Interest	Balance
1	$2,027.64	$1,360.97	$666.67	$98,639.03
2	$2,027.64	$1,370.05	$657.59	$97,268.98
3	$2,027.64	$1,379.18	$648.46	$95,889.80
4	$2,027.64	$1,388.37	$639.27	$94,501.43
5	$2,027.64	$1,397.63	$630.01	$93,103.80
6	$2,027.64	$1,406.95	$620.69	$91,696.85
7	$2,027.64	$1,416.33	$611.31	$90,280.52
8	$2,027.64	$1,425.77	$601.87	$88,854.75
9	$2,027.64	$1,435.27	$592.37	$87,419.48
10	$2,027.64	$1,444.84	$582.80	$85,974.64
11	$2,027.64	$1,454.48	$573.16	$84,520.16
12	$2,027.64	$1,464.17	$563.47	$83,055.99

Types of Business Loans

Business financing comes in several forms, each suited to different needs. Term loans provide a lump sum repaid over a fixed schedule and work well for capital investments, expansions, and large purchases. SBA loans (7(a) and 504) offer government-backed favorable terms — lower rates and longer repayment periods — but involve more paperwork and slower approval. Equipment loans use the purchased equipment as collateral, often making them easier to qualify for. Lines of credit provide revolving access to funds for cash flow management and short-term needs, with interest charged only on the amount drawn.

How to Qualify for a Business Loan

Lenders evaluate several factors: your personal and business credit scores, annual revenue and profitability, time in business (at least 2 years for most bank loans), and available collateral. The most critical metric is your Debt Service Coverage Ratio (DSCR) — your net operating income divided by your total debt payments. Most lenders require a DSCR of at least 1.25x, meaning your income is 25% higher than your debt obligations. This calculator estimates your DSCR based on the monthly revenue you provide.

Understanding the True Cost: APR vs. Interest Rate

The interest rate alone does not tell the whole story. Origination fees, SBA guarantee fees, closing costs, and other charges increase the effective cost. The Annual Percentage Rate (APR) includes these fees and gives you a more accurate picture for comparison. A loan at 7% with a 3% origination fee can cost more than a loan at 8% with no fees, depending on the term. Always compare APR, total cost, and monthly payment together to find the best deal for your business.

Frequently Asked Questions

How much can I borrow for a business loan?+

Borrowing limits depend on the loan type and your business financials. SBA 7(a) loans go up to $5 million, SBA 504 up to $5.5 million, and conventional term loans vary by lender. Most lenders look at your annual revenue, cash flow, time in business, and credit score. A common rule of thumb is that you can borrow 10-30% of your annual revenue for unsecured loans, or more with collateral.

What is an SBA loan?+

SBA loans are partially guaranteed by the U.S. Small Business Administration, which reduces risk for lenders and allows them to offer lower rates and longer terms. The SBA 7(a) is the most common, covering working capital, equipment, and real estate. The SBA 504 is specifically for fixed assets like commercial real estate and heavy equipment. SBA loans typically require 10-20% down and a credit score of 680+.

What credit score do I need for a business loan?+

Requirements vary by loan type. SBA loans generally require 680+. Conventional bank term loans usually need 700+. Online lenders may approve scores as low as 550-600, but at higher interest rates. Equipment loans may be more flexible since the equipment serves as collateral. A higher score gets you lower rates and better terms.

How do business loan interest rates work?+

Business loan rates can be fixed or variable. Fixed rates stay the same for the loan term. Variable rates are tied to a benchmark like the prime rate (currently around 8.5%) plus a margin. SBA 7(a) rates are typically prime + 2.25% to 2.75%. The rate you get depends on your credit score, time in business, revenue, collateral, and the loan type.

What is the difference between SBA 7(a) and SBA 504?+

SBA 7(a) is a general-purpose loan up to $5M for working capital, equipment, real estate, or refinancing. SBA 504 is specifically for major fixed assets — commercial real estate and large equipment — up to $5.5M, with lower fixed rates and longer terms (10-25 years). SBA 504 loans require working with a Certified Development Company (CDC) and typically have a 10% down payment from the borrower.

Should I get a term loan or line of credit?+

Term loans provide a lump sum with fixed monthly payments — best for one-time investments like equipment, expansion, or real estate. Lines of credit give you flexible access to funds you can draw and repay as needed — best for managing cash flow gaps, seasonal expenses, or unexpected costs. Term loans usually have lower rates but less flexibility. Many businesses benefit from having both.