Business Loan Calculator

Calculate your business loan payments, total interest costs, and affordability metrics. Determine if your business can support the debt with debt service coverage ratio analysis.

Monthly Payment = P * [r(1 + r)^n] / [(1 + r)^n - 1] | DSCR = Net Operating Income / Debt Service | Effective APR = [(Total Cost - Principal) / Principal / Years] * 100
For a $100,000 loan at 7.5% for 5 years with 2% origination fee: Monthly payment = $2,000, Total interest = $19,740, Total fees = $2,000, DSCR with $50k revenue and $35k expenses = 7.5

What types of business loans are available?

Common business loans include: Term loans (fixed repayment schedule), SBA loans (government-backed), business lines of credit (revolving credit), equipment financing (secured by equipment), invoice financing, merchant cash advances, and commercial real estate loans. Each has different terms, rates, and qualification requirements.

What credit score do I need for a business loan?

Credit score requirements vary by lender and loan type. SBA loans typically require 680+, traditional bank loans often need 700+, while alternative lenders may accept scores as low as 500-600 (with higher rates). Your business credit score and time in business also matter significantly.

What is the difference between secured and unsecured business loans?

Secured loans require collateral (equipment, real estate, inventory) and typically offer lower interest rates and higher loan amounts. Unsecured loans don't require collateral but have stricter credit requirements and higher interest rates. If you default on a secured loan, the lender can seize the collateral.

How do I calculate if I can afford a business loan?

Use the debt service coverage ratio (DSCR): divide your net operating income by total debt service. Lenders typically want a DSCR of 1.25 or higher, meaning you earn $1.25 for every $1.00 of debt payments. Also consider cash flow, existing debt obligations, and seasonal revenue fluctuations.

What fees are associated with business loans?

Common fees include: origination fees (1-6% of loan amount), application fees, appraisal fees, closing costs, annual fees, prepayment penalties, and late payment fees. SBA loans have guarantee fees. Always calculate the total cost of borrowing, not just the interest rate (expressed as APR).

Can I pay off a business loan early?

Many business loans allow early repayment, but some include prepayment penalties (typically 2-5% of remaining balance). This compensates lenders for lost interest. SBA loans often have declining prepayment penalties. Always ask about prepayment terms before signing, especially if you plan to pay off the loan early.