GetToolr

How to Use This Calculator

Choose your loan type (term loan, SBA loan, or line of credit), enter the loan amount, rate, and term. For SBA loans, the guarantee fee is calculated automatically. Enter your annual revenue to see what percentage of income goes to loan payments and whether the debt load is healthy for your business.

Calculator

Business Loan Calculator

Calculate monthly payments, total cost of borrowing, and effective APR for business loans and SBA loans.

Loan Type

Loan Details

$
%
years
%

Revenue Context

$
Annual Loan Payments$24,910
% of Revenue5.0%

Healthy. Loan payments are well within revenue capacity.

Yearly Amortization

YearPrincipalInterestBalance
1$16,583$8,327$83,417
2$18,139$6,771$65,278
3$19,840$5,070$45,438
4$21,701$3,209$23,737
5$23,737$1,173$0

Monthly Payment

$2,076

Cost of Borrowing

Total Interest$24,550
Origination Fee$2,000
Total Cost of Borrowing$26,550
Effective APR9.87%

Business Loan Types Compared

Term Loan

7-12%

Fixed amount with regular payments over a set term. Best for equipment, expansion, or one-time investments. Most straightforward option.

SBA 7(a)

10-13%

Government-backed with longer terms and lower down payments. Best for established businesses. More paperwork but better terms. Up to $5M.

Line of Credit

8-24%

Revolving credit you draw from as needed. Pay interest only on what you use. Best for managing cash flow gaps and seasonal fluctuations.

Understanding the True Cost of Borrowing

The interest rate alone does not tell you the full cost. Origination fees (1-5%), SBA guarantee fees (2-4%), and other closing costs increase the effective APR. A loan advertised at 9% with a 3% origination fee effectively costs 10-11% when you account for fees. The calculator shows the effective APR including all fees.

Revenue coverage rule

Before taking on business debt, make sure annual loan payments stay below 15% of your annual revenue. This leaves enough cash flow for operations, emergencies, and growth. The calculator shows this ratio automatically so you can assess whether the debt is manageable.

Frequently Asked Questions

What is an SBA loan?
SBA loans are partially guaranteed by the Small Business Administration, reducing risk for lenders and enabling better terms for borrowers. The most common is the SBA 7(a) loan, which offers up to $5 million with terms up to 25 years for real estate and 10 years for equipment/working capital. Rates are typically Prime + 2-3%.
What is the SBA guarantee fee?
The SBA charges a guarantee fee based on loan amount and term. For loans over $150,000, the fee is typically 2.77-3.75% of the guaranteed portion. This fee can be rolled into the loan. It is a one-time cost, not annual.
What is a good interest rate for a business loan?
SBA 7(a) loans currently range from 10-13% (Prime + 2.75%). Traditional bank term loans range from 7-12% for well-qualified borrowers. Online lenders charge 9-30%+ depending on risk. Revenue-based financing can have effective rates of 20-40%.
How much of revenue should go to loan payments?
Financial advisors recommend keeping loan payments under 10-15% of annual revenue. Above 20%, the debt burden becomes risky and leaves less room for operating expenses, growth, and unexpected costs. The calculator shows your payment-to-revenue ratio automatically.

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