How to use this calculator
Enter your loan amount, annual interest rate, and loan term in years. Choose between monthly or biweekly payment frequency. The calculator shows your payment amount, total interest paid over the life of the loan, and a year-by-year amortization table.
Use the amortization summary to see how much of each year's payments go toward principal versus interest. In the early years, most of your payment covers interest. By the final years, the majority goes toward paying down the principal.
Frequently asked questions
How do I calculate a business loan payment?
The standard amortization formula calculates equal periodic payments that cover both principal and interest. You need three inputs: the loan amount, periodic interest rate, and total number of payment periods. A $100,000 loan at 8% annual for 5 years yields approximately $2,028 per month.
What is a typical business loan interest rate?
Rates depend on the lender and your profile. SBA loans run 6-9%. Traditional banks offer 5-10%. Online lenders charge 8-30% or more. Your credit score, time in business, revenue, and loan size all affect the rate you qualify for.
Is biweekly payment better than monthly?
Biweekly payments result in 26 half-payments per year (equivalent to 13 monthly payments instead of 12). That extra payment reduces principal faster, saving interest and shortening your loan term. Not all lenders offer true biweekly plans, so confirm with yours.
What loan term should I choose?
Match the term to the asset's useful life. Equipment: 3-7 years. Working capital: 1-3 years. Commercial real estate: 10-25 years. Shorter terms mean higher payments but less total interest. Ensure your cash flow comfortably covers the payment.
How much can my business afford to borrow?
Calculate your debt service coverage ratio: net operating income divided by total debt payments. Lenders typically require 1.25 or higher. This means for every $1 in debt payments, you earn at least $1.25, leaving a buffer for unexpected costs.