Business Loan Calculator
Estimate business loan payments for amortized, interest-only or deferred terms, with origination fees, total interest and finance charges.
Processing fee charged upfront as a % of the loan. Deducted from what you receive; 1–8% is typical for business loans.
Monthly payment
$1,213.28
Total payment
$145,593
Over 120 months
Total interest
$45,593
You receive
$100,000
After $0 origination fee
Finance charge
$45,593
Total payment minus the amount received
Payoff note
Fully amortized
First 12 payments
| Month | Payment | Interest | Principal | Balance |
|---|---|---|---|---|
| 1 | $1,213.28 | $666.67 | $546.61 | $99,453.39 |
| 2 | $1,213.28 | $663.02 | $550.25 | $98,903.14 |
| 3 | $1,213.28 | $659.35 | $553.92 | $98,349.22 |
| 4 | $1,213.28 | $655.66 | $557.61 | $97,791.6 |
| 5 | $1,213.28 | $651.94 | $561.33 | $97,230.27 |
| 6 | $1,213.28 | $648.2 | $565.07 | $96,665.2 |
| 7 | $1,213.28 | $644.43 | $568.84 | $96,096.35 |
| 8 | $1,213.28 | $640.64 | $572.63 | $95,523.72 |
| 9 | $1,213.28 | $636.82 | $576.45 | $94,947.27 |
| 10 | $1,213.28 | $632.98 | $580.29 | $94,366.97 |
| 11 | $1,213.28 | $629.11 | $584.16 | $93,782.81 |
| 12 | $1,213.28 | $625.22 | $588.06 | $93,194.75 |
SBA and bank business loans are usually amortized. Balloon and interest-only structures are common for commercial real estate. Origination fees raise the effective cost above the quoted rate.
How it works
M = P × r(1+r)ⁿ ÷ ((1+r)ⁿ − 1) for amortised loans. Total cost = M × n.
Example: $100,000 at 10% for 5 years → $2,125/month, $27,476 total interest.
Last updated: April 2026
How this calculator is verified
Checked by True Calculator automated test suite on
- Formula verified against a published worked example in the automated test suite
- Edge cases (zero, negative, boundary and unit-mismatch inputs) covered by unit tests
The full verification method is on our how we verify page. Found an error? Tell us and we will re-check it.
When to Use This Calculator
Use the business loan calculator when you are evaluating a loan for your company and need to see the repayment pattern, not just the EMI. Indian small businesses borrow for working capital, equipment and expansion, and lenders offer different structures — a standard amortized loan, interest-only EMIs for the first months, or a fully deferred repayment period — which produce very different cash-flow shapes. This tool models all three schedules so a shopkeeper or manufacturer can check which structure matches how their business earns money. Enter the loan amount, rate and tenure, pick the schedule, and read the monthly payment, total interest and total cost. Compare two lenders on the same inputs, because the cheapest-sounding rate can lose once fees and schedule differences are counted.
How to Use This Calculator
- Step 1: Enter the loan amount and the annual interest rate quoted by the lender.
- Step 2: Choose the repayment style — amortized, interest-only or deferred, where interest compounds until maturity — and set the term in years.
- Step 3: Enter an origination fee percentage if the lender charges one (1–8% is typical); it is deducted from the amount you receive.
- Step 4: Compare the monthly payment, total interest, amount received and finance charge, and review the first 12 payments of the amortization schedule.
Worked Example
A $100,000 business loan at 8% over 10 years amortized costs $1,213.28 per month, with about $45,594 in total interest. Add an 8% origination fee and you receive $92,000 after the $8,000 fee, while the finance charge — total payment minus amount received — rises to about $53,594. An interest-only loan at the same rate over 5 years charges $666.67 a month with the full $100,000 principal due at maturity, for $40,000 in total interest. Deferred mode compounds everything into a single payment at maturity, so the monthly outlay is zero until then — a trade-off every business must judge.
Tips and Common Mistakes
- •Tip 1: Interest-only and deferred loans keep early cash flow light but cost more in total interest than amortized repayment.
- •Tip 2: Add the origination fee to the quoted rate before comparing offers — the finance charge, not the rate, is the true cost.
- •Tip 3: A shorter term raises the monthly payment but cuts total interest sharply; run the same inputs at 5 vs 10 years to see the gap.
- ✗Mistake 1: Comparing amortized and deferred totals without noticing that deferred loans pay a lump sum at maturity, which needs cash-flow planning.
- ✗Mistake 2: Entering the term in months when the field expects years — the payment will be grossly understated.
Frequently Asked Questions
How do I estimate a business loan payment?
Enter the loan amount, annual interest rate and repayment term. The calculator returns the fixed monthly payment, total cost and interest breakdown so you can budget cash flow.
What is a good interest rate for a business loan?
Rates depend on loan type, lender and business health — typically 6%–30%+ for term loans, while SBA loans often fall on the lower end. Compare total cost, not just the rate, across lenders.
Should I choose a shorter or longer business loan term?
Shorter terms mean higher monthly payments but far less interest; longer terms ease cash flow but cost more overall. This calculator shows both scenarios side by side.
Is this business loan calculator free to use?
Yes, True Calculator's business loan calculator is completely free with no sign-up, no app install and no usage limits.
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