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Business Loan Calculator
Use this business loan calculator to estimate your monthly payments and interest based on the loan term and APR.
Many or all of the products featured here are from our partners who compensate us. This may influence which products we write about and where and how the product appears on a page. However, this does not influence our evaluations. Our opinions are our own. Here is a list of our partners and here's how we make money.
The cost of a small-business loan depends on the loan amount, repayment term and annual interest rate.
Enter these numbers into NerdWallet’s business loan calculator to estimate your monthly payment, total interest costs and total amount repaid. Then adjust the loan characteristics to see how changes can affect repayment.
Calculate estimated payments, then see if you qualify for a business loan
Over the course of the loan, expect to pay
Total principal & interest
Get personalized small-business loan rates to compare
We’ll start with a brief questionnaire to better understand the unique needs of your business.
Once we uncover your personalized matches, our team will consult you on the process moving forward.
How to use the business loan calculator
The best small-business loan is typically the one you can qualify for with the most ideal terms. As you search for business financing, you’ll want to compare interest rates, funding time and repayment terms, among other factors.
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Here’s what you need to calculate the total cost of a business loan:
Loan amount. The total amount of capital your business borrows.
Repayment term. The time it takes (in months) to repay the loan.
Annual percentage rate. The annual cost of the loan that includes interest and fees.
An APR makes it easier to do an apples-to-apples comparison between products. It’s important to keep in mind, however, that some lenders do not provide APR and instead give a general interest rate, or a factor rate, that does not usually include fees.
In these cases, you’ll want to calculate your rate into an APR to get a better sense of how much your loan will cost.
For a general interest rate, you’ll need to add in any additional fees to calculate your APR. For instance, say you have a $60,000 loan with a 4% interest rate and $2,000 in fees. First, you add those fees to your original loan amount to create a new loan amount of $62,000.
Then, you use your 4% interest rate to calculate a new annual payment of $2,480 ($62,000 x 0.04). To calculate the APR, divide the annual payment of $2,480 by the original loan amount of $60,000 to get 4.13%.
Factor rates, on the other hand, can be more complex. These rates are expressed as a decimal, as opposed to a percentage (e.g. 1.1, 1.5). You can multiply the factor rate by your loan amount to determine the total amount you ’ll owe your lender. If you have a $50,000 loan with a 1.2 factor rate, for example, you’ll owe a total of $60,000 ($50,000 x 1.2).
By inputting this information into the calculator, you’ll receive:
Monthly payment. The fixed amount you’ll repay each month. It includes principal, interest and fees.
Total interest paid. The total amount a lender is charging you for a loan. If you repay the loan early, you might be able to save on interest — provided your lender doesn’t charge prepayment penalties.
Total payments. The sum of all the payments to make on the loan, which includes the amount you borrowed, plus interest and fees.
Amortization schedule. This schedule shows how much of your monthly (or annual) payments will go toward your principal and how much will go toward interest. As you continue to repay your loan over time, your monthly payment will remain the same, but your interest payments will get smaller and more of your payment will go toward your principal.
To qualify for a business bank loan, however, you’ll generally need a high personal credit score (starting in the 700s). Banks also tend to look for several years of operating history and strong cash flow from the business. Sometimes, these lenders require collateral and will usually require a personal guarantee.
Online lenders, on the other hand, typically have less stringent qualification requirements, making these loans more accessible to more business owners. These lenders can often fund loans much more quickly than banks — as soon as the same or next day. They also tend to charge higher interest rates and have shorter terms, however.
The U.S. Small Business Administration works with banks and other financial institutions to provide small-business loans that have low interest rates and long repayment terms. However, SBA loans are slow to fund and can be difficult to qualify for.
You must have good personal credit (690 or higher, although some SBA lenders may have lower score requirements), and your business must demonstrate strong financial performance.
Term loans typically range from three to 18 months for a short-term loan and up to 10 years or longer for a long-term loan. Business owners can use the financing, which usually runs up to $500,000, for specific items such as equipment or inventory. Banks and online lenders both offer term loans.
Lines of credit
A business line of credit provides flexible access to cash. Similar to a credit card, you get a specific amount of credit and can draw from your line as needed. You only make payments and pay interest on the money you use. Banks and online lenders both offer business lines of credit.
Equipment financing is a loan to buy equipment, and the equipment is used as collateral. Equipment lenders often finance up to 100% of the value of the equipment. You repay the loan over time with interest.
Invoice factoring involves selling unpaid customer invoices to a factoring company that then collects the money from your customers.
Invoice financing is an alternative that allows you to use unpaid invoices collateral on a cash advance. You still collect payment on the invoices from your customers, and then you pay back the loan. This method gives you more control over the invoices. One advantage of invoice factoring and financing is that the funds arrive in your bank account relatively faster than other types of financing.
A personal loan for business may be an option for new businesses that don’t qualify for traditional financing. Lenders consider your personal credit score and income instead of your business history.
A business credit card can also be easier to get than a small-business loan. However, business credit cards tend to have relatively low credit limits, but you can earn rewards for your spending, such as cash back or travel points.
Small-business grants provide free money to startups and operating businesses – either by giving you a lump sum, or reimbursing you for certain expenses. They can be difficult to research and apply for and grant amounts typically aren’t as high as loans, but it can be worth it if you’re able to get free money for your business, even in small amounts.
Frequently Asked Questions
A business loan term can be as short as three months and as long as 10 years or more. To qualify for a long-term business loan, you’ll likely need to have an established business with strong finances.
Online lenders typically charge business loan rates from 6% to 99% APR. You’ll likely find the lowest rates from bank or SBA loans. Bank loans, on average, range from 5.75% to 11.91%, and SBA loans range from
Some business loans have monthly payments — although others will require weekly or daily payments. Bank and SBA loans are typically repaid on a monthly basis, whereas short-term online products (e.g. lines of credit, merchant cash advances) are more likely to be repaid daily or weekly.