Calculate monthly business loan payments, total interest, and total financing cost.
| Loan Amount | $50,000 |
| Origination Fee | $2,500 |
| Total Amount Borrowed | $52,500 |
| Annual Interest Rate | 9.50% |
| Loan Term | 60 months |
| Monthly Payment | $1,103 |
| Total Interest Paid | $16,156 |
| Total Cost of Borrowing | $18,656 |
| Total Amount Paid | $66,156 |
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Monthly Payment = (Principal + Fee) × [r(1+r)^n] / [(1+r)^n - 1]
Total Interest = (Payment × n) − Principal
Total Cost of Borrowing = Origination Fee + Total Interest
Where r = monthly interest rate, n = number of months.
Business loan rates typically range from 3-30% depending on creditworthiness, loan type, and lender. SBA loans: 6-10%, bank loans: 5-15%, online lenders: 7-30%. Your credit score and time in business significantly impact rates.
Common types: SBA loans (government-backed, 5-30 years), bank loans (secured or unsecured), equipment financing (collateral-based), lines of credit (revolving), and invoice factoring. Each has different rates, terms, and qualification requirements.
Lenders typically allow borrowing 1-2.5x annual revenue. Most require: 2+ years in business, personal credit score 680+, debt-to-income ratio under 40%, and collateral or personal guarantee. Startup loans are harder to obtain and have higher rates.
Key factors: credit score (biggest impact), time in business, annual revenue, debt-to-income ratio, collateral, loan type, and lender type. Secured loans (collateral) have lower rates. Building credit and reducing debt improves rates.
Shorter terms (1-3 years) = higher payments, less interest. Longer terms (5-10 years) = lower payments, more interest. Match term to the asset's useful life (equipment: 5-10 years, working capital: 2-5 years).
Yes. Interest on business loans is generally tax-deductible as a business expense. This effectively lowers your tax bill. Consult a CPA to understand your specific deduction and how it affects your bottom line.
Calculations are for educational purposes only. Consult a qualified financial advisor for personalized advice.