Business Loan Calculator
Estimate your monthly payment, total interest, and total cost — for a business loan with a fixed monthly payment.
How to use this calculator
A business loan, in its most common form, gives you a fixed amount of capital up front that you repay in equal monthly payments over a set period until it's paid off. This calculator estimates that monthly payment and shows you the full cost of the loan over its life. Here's what each input does:
Loan Amount. The total amount you're borrowing up front. This becomes your principal — the figure your interest and your monthly payment are both built on. Set it to the amount you actually need to fund the purpose at hand.
Loan Term. How long you take to repay the loan, in months. A shorter term means higher monthly payments but less total interest; a longer term lowers the monthly payment but costs more overall. Business loans of this type commonly run from 12 to 60 months.
Interest Rate (APR). The annual percentage rate on your loan. Set this to match the rate in your offer. APR is an annual figure, so the calculator converts it to a monthly rate behind the scenes to calculate each payment.
Origination Fee (optional). Some lenders charge a one-time origination fee, expressed as a percentage of the loan amount. If your offer includes one, open this field and enter it; the calculator rolls it into the amount financed and reflects it in the True APR so you see the real all-in cost rather than just the headline rate. Once your inputs are set, the calculator returns your estimated monthly payment, total repayment, principal amount, total interest paid, True APR, and estimated payoff date. The next sections explain what those numbers mean and why they move the way they do.
What kind of business loan this calculator models
"Business loan" can refer to two structures that are priced very differently, so it's worth knowing which one your offer is before you model it here.
An interest-based loan charges interest on your declining balance — the structure this calculator models. You borrow a fixed amount and repay it in equal monthly payments, with interest accruing only on what you still owe. As the balance falls, so does the interest, and paying it down reduces what you pay overall. This is how bank and SBA term loans, and most conventional business loans, are structured.
A factor-rate product works differently. Many alternative lenders use "loan" or "term loan" for what is really a factor-rate product — the same structure sometimes called revenue-based financing, working capital or a merchant cash advance. Instead of an interest rate on a declining balance, you repay a fixed total — the funded amount multiplied by a factor rate — through set daily or weekly payments. The cost is fixed up front rather than accruing on your balance. This calculator is built for the interest-based structure. If your offer is quoted with a factor rate rather than an interest rate, the math here won't match it — the Working Capital calculator is built for that structure instead.
How a business loan payment is calculated
Your payment is built on three things: the amount, the rate, and the term. An interest-based loan amortizes — the calculator spreads your principal and interest into level monthly payments, so you pay the same amount every month for the life of the loan. Change any one of those three inputs and the payment adjusts instantly.
Each payment is part interest, part principal — and the mix shifts over time. Early in the term, more of each payment goes toward interest, because interest is charged on a larger outstanding balance. As the balance falls, more of each payment goes toward principal. By the final months, almost all of each payment is principal. The amortization schedule below the results shows this month by month.
The balance falls as you repay it. Because each payment chips away at what you owe, the balance you're paying interest on shrinks every month. This is why the total interest in dollars is always less than "rate × full amount × years" would suggest — you don't hold the full balance for the full term.
Paying off early can save you money — but it depends on the loan. Because interest accrues on your remaining balance over time, repaying ahead of schedule often reduces the interest you'd otherwise pay. But the savings aren't automatic, because loans vary in how they treat early payoff. Some allow it freely and you simply owe the remaining principal. Some charge a prepayment penalty, often a percentage of the balance that declines the longer you've held the loan. And a few are structured so the interest is front-loaded or charged in full regardless of when you pay, which erases the savings. Before counting on an early payoff to save money, check how your specific loan handles it — and whether you can make extra principal payments at all, since not every loan allows them.
Understanding your results
Estimated Monthly Payment. The amount you pay each month to repay your loan over the selected term. Adjust the amount, rate, or term and this updates instantly.
Total Repayment. The sum of everything you pay over the life of the loan — your principal, all the interest, and any origination fee. This is the true all-in figure: what you borrowed plus what it cost to borrow it.
Principal Amount. The original sum you borrowed, shown again in the results as a reminder of what portion of your total repayment is the money itself versus the cost of borrowing it.
Total Interest Paid. The portion of your repayment that's pure cost of capital. This is a number to minimize, but read it alongside the rate and term rather than on its own — a low total can simply mean a short term, not a good rate.
True APR. The all-in annual rate once any origination fee is included. With no fee, it equals the rate you entered. When you add a fee, it rises above the headline rate, because the fee is a real cost of borrowing. This is the number to carry into a lender conversation — ask for the all-in APR, not just the interest rate, so you compare offers on the same basis.
Estimated Payoff Date. The month and year your loan would be fully repaid at the current payment. LimeLyne calculators always compute this from today's actual date, so it's never stale.
What actually affects your cost
The loan amount. More principal means more interest, in direct proportion. The discipline here is borrowing what you genuinely need for the purpose at hand.
The term. A longer term lowers the monthly payment but keeps your balance — and the interest accruing on it — outstanding longer, raising the total cost. A shorter term costs less in total interest but comes with a higher monthly payment. One thing worth keeping in mind: on a short term, the total interest figure can look small even when the rate is relatively high, because you're paying the balance down quickly. It's helpful to compare offers by their rate rather than by the total interest dollars alone.
The rate — and the fees behind it. The headline interest rate isn't always the full cost. An origination fee raises your real annual rate above the quoted figure, which is exactly what the True APR output captures. When comparing offers, compare the all-in True APR, not just the rate.
How to reduce what a term loan costs you
Match the term to the need. A longer term feels easier month to month, but every extra month is more interest. Choose the shortest term your cash flow can comfortably carry, and you cut the total cost without changing anything else about the loan.
Understand your early-payoff and extra-payment terms before you sign. How much flexibility you have to pay ahead varies by loan. Some loans let you make extra principal payments or pay the balance off in full with no penalty; others charge a prepayment penalty, and a few calculate interest in a way that removes the benefit of paying early. If the ability to pay down or pay off early matters to you, ask about it before signing and compare offers on that flexibility, not just the rate.
Compare offers on the all-in cost. Two loans with the same headline rate can cost very differently once origination fees are factored in. Use the True APR figure to compare offers on equal footing rather than judging by the interest rate alone.
Frequently Asked Questions
Common questions about how the calculator works and what the numbers mean.
Your payment is calculated from three inputs: the loan amount, the interest rate (APR), and the term. The calculator amortizes the loan — spreading principal and interest into equal monthly payments, so you pay the same amount every month until the balance reaches zero. Early payments are weighted more toward interest; later payments more toward principal.
No — this calculator models an interest-based loan, where interest accrues on your declining balance. Some lenders use “loan” or “term loan” for a factor-rate product instead, where you repay a fixed total (the funded amount times a factor rate, such as 1.25) through set daily or weekly payments. A factor-rate product technically isn’t a loan, even when it’s marketed as one. If your offer is quoted with a factor rate rather than an interest rate, the math here won’t match it — use the Working Capital calculator, which is built for that structure.
The interest rate is the annual rate charged on your balance. The True APR is the all-in annual cost once any origination fee is included. With no fee, the two are identical. When a fee is added, the True APR rises above the rate, because the fee is a real cost of borrowing that the headline rate alone doesn’t capture. When comparing offers, compare the True APR — it puts two loans with different fees on the same footing.
Because interest accrues over time. A shorter term keeps your balance outstanding for fewer months, so less total interest accumulates — even though each monthly payment is larger. A longer term lowers the monthly payment but keeps the balance outstanding longer, raising the total cost. It’s a direct trade-off between monthly affordability and total interest paid.
Not necessarily. Because your balance falls as you repay it, the total interest in dollars is always less than “rate × full amount × years” would suggest — you never hold the full balance for the full term. On a shorter term especially, a high rate can still produce a modest-looking interest total. Compare offers by the rate and the True APR, not by the interest dollars alone.
If your offer includes an origination fee, the calculator rolls it into the amount financed and reflects it in your total repayment and your True APR. That’s what lets you see the real cost of the loan rather than just the quoted rate. A loan with a lower rate but a high origination fee can end up costing more than one with a slightly higher rate and no fee — the True APR is where that shows up.
Sometimes, but it depends on the loan. Some loans let you pay off early and owe only the remaining principal; others charge a prepayment penalty, and a few calculate interest in a way that reduces the benefit of paying early. Whether an early payoff saves money comes down to weighing the interest you’d avoid against any penalty owed. If that flexibility matters to you, ask your lender how early payoff is handled before you sign.
It’s the month and year your loan would be fully repaid if you make each scheduled payment over the selected term. The calculator computes it from today’s actual date, so it always reflects a real timeline rather than a static estimate.
No — they’re estimates for planning. Your actual rate, amount, and term depend on your business’s full profile and the specific lender. The value of the calculator is in showing how the mechanics work and how your inputs move the cost, so you walk into a real conversation already understanding the numbers.
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