Business Loan Calculator

Loan Details

Loan Amount

Loan Term

months

Interest Rate (%)

Loan Fees

Origination Fee (%)

SBA Guaranty Fee (%)

Other Fees

About the Business Loan Calculator

This calculator helps business owners estimate monthly payments and total costs for commercial loans, including SBA loans and traditional business financing. Compare different loan terms and understand the complete cost structure, including various fees common in business lending.

How to Use This Calculator

Enter Loan Amount: Input the amount you need to borrow for your business.
Specify Loan Term: Enter the repayment period in months (typically 12-300 months).
Input Interest Rate: Enter the annual interest rate offered by your lender.
Add Fees: Include origination fees, SBA guaranty fees (if applicable), and other closing costs.
Review Results: Analyze monthly payments, total costs, APR, and complete amortization schedule.

About Business Loans

Business loans provide essential financing for companies to fund growth, manage operations, or invest in new opportunities. Understanding the different types and requirements helps make informed borrowing decisions.

Loan Types

Traditional Bank Loans

Lower interest rates
Longer approval process
Strict qualification requirements
Various term lengths available

SBA Loans

Government guaranteed
Lower down payments
Competitive rates
Longer repayment terms

Key Requirements

Financial Requirements

Business credit score
Annual revenue history
Cash flow statements
Tax returns

Business Requirements

Time in business
Industry type
Business plan
Collateral availability

Common Fees

Upfront Fees

Origination fees (1-6%)
SBA guarantee fees (2-3.75%)
Application fees
Appraisal fees

Ongoing Fees

Late payment fees
Annual service fees
Prepayment penalties
Insurance requirements

Tips for Success

Application Tips

Prepare comprehensive documentation, maintain good credit, and have a clear business plan before applying.

Management Tips

Monitor cash flow carefully, make payments on time, and maintain good communication with your lender.

Key Terms to Understand

Annual Percentage Rate (APR)

The total yearly cost of the loan including interest and fees. APR provides a more complete picture of borrowing costs than the interest rate alone, especially important for business loans with multiple fees.

SBA Guaranty Fee

A fee charged on SBA loans to cover the government's guarantee. The fee varies based on loan amount and term, typically ranging from 2% to 3.75% of the guaranteed portion of the loan.

Amortization

The gradual repayment of the loan through regular monthly payments. Each payment includes both principal and interest, with the proportion of principal increasing over time. Understanding amortization helps with cash flow planning.

Debt Service Coverage Ratio

A key metric lenders use to evaluate business loan applications, calculated by dividing net operating income by total debt service. A ratio above 1.25 is typically required for approval.

Frequently Asked Questions

How much can my business borrow?

Borrowing capacity depends on factors including business revenue, credit score, time in business, and debt service coverage ratio. Traditional bank loans typically range from $30,000 to $5 million, while SBA loans can go up to $5 million.

What interest rates can I expect?

Business loan rates typically range from 3% to 15% for traditional bank loans, and 5.5% to 8% for SBA loans. Rates depend on creditworthiness, loan type, term length, and market conditions.

How do SBA loans differ from traditional loans?

SBA loans are partially guaranteed by the government, often offering lower down payments and longer terms. However, they include additional fees and may have a longer approval process than traditional bank loans.

What documentation is typically required?

Common requirements include business tax returns, financial statements, bank statements, business plan, and collateral documentation. SBA loans may require additional paperwork including personal financial statements.

Tips for Business Loan Success

Prepare Documentation

Organize financial statements, tax returns, and business plans before applying. Well-prepared documentation can speed up approval and may help secure better terms.

Compare Multiple Offers

Shop around and compare offers from different lenders. Consider both traditional banks and SBA lenders to find the best combination of rates, terms, and fees.

Understand Total Cost

Look beyond monthly payments. Consider the total cost including all fees, and use APR for accurate loan comparisons. Factor in tax implications and potential prepayment penalties.

Plan for Success

Create a detailed repayment plan that aligns with your business cash flow. Consider seasonal fluctuations and maintain a cash reserve for unexpected expenses.