Business Loan
The Business Loan Calculator helps entrepreneurs and business owners understand the true cost of financing. Enter the loan principal, annual interest rate, and repayment term to instantly see your monthly payment, total repayment, and total interest expense. Use it to compare different loan offers, assess cash flow impact, and decide whether the ROI of the investment justifies the borrowing cost.
First 12 Months Amortization
| Month | Payment | Principal | Interest | Balance |
|---|---|---|---|---|
Interest-only period shown. Full principal balloon payment is due at term end.
Monthly Payment
SBA Loan vs. Traditional Business Loan
SBA 7(a) loans are the most popular government-backed small business loans, offering amounts up to $5 million with repayment terms up to 10 years for working capital or 25 years for real estate. Because they're partially guaranteed by the SBA, lenders can offer lower rates than conventional loans — typically prime + 2.75% to 4.75%.
Traditional business loans from banks or credit unions offer faster approvals and fewer restrictions, but typically require strong credit (700+), 2+ years in business, and strong revenue. They're better for businesses that don't qualify for or need SBA backing.
SBA 7(a) Loan
- Up to $5M loan amount
- Terms up to 25 years
- Lower rates (prime + spread)
- Slower approval (30–90 days)
Traditional Bank Loan
- Flexible loan amounts
- Terms typically 1–10 years
- Higher rates possible
- Faster approval (1–2 weeks)
How to Qualify for a Small Business Loan
Maintain a strong credit score
Most lenders require a personal credit score of 680+ for conventional loans. SBA loans can accept scores as low as 640, but higher is better.
Show at least 2 years of business history
Lenders want to see a track record. Startups under 2 years old have fewer options — look into microloans or SBA startup programs.
Demonstrate sufficient cash flow
Your business should have a debt service coverage ratio (DSCR) of at least 1.25, meaning $1.25 of income for every $1.00 of debt payments.
Prepare your financial documents
Have 2–3 years of business tax returns, profit and loss statements, balance sheets, and bank statements ready before applying.
About the Business Loan Calculator
The Business Loan Calculator helps entrepreneurs and business owners understand the true cost of financing. Enter the loan principal, annual interest rate, and repayment term to instantly see your monthly payment, total repayment, and total interest expense. Use it to compare different loan offers, assess cash flow impact, and decide whether the ROI of the investment justifies the borrowing cost.
How to use it
- Enter the loan amount you need (principal).
- Input the annual interest rate quoted by the lender.
- Set the repayment term in months or years.
- Review total interest, monthly payment, and full amortization breakdown.
Formula & methodology
Monthly payment = P * [r(1+r)^n] / [(1+r)^n - 1]. P = principal, r = monthly rate (APR/12), n = term in months. Total repayment = monthly payment * n. Total interest = total repayment - P. Effective annual rate (EAR) = (1 + r)^12 - 1.
Common use cases
- Comparing SBA loan vs bank term loan cost
- Evaluating equipment financing vs leasing
- Determining if a working capital loan ROI is positive
- Planning cash flow around known monthly debt service
- Presenting loan scenarios to investors or partners
Frequently asked questions
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