Business Loan Calculator

Understanding Business Loans

Business loans are designed to meet the financing needs of many different business types. They require the borrower to pay back both the principal and the interest, typically through monthly repayments.

Common Loan Types

SBA Loans

Loans from the U.S. Small Business Administration (SBA) are government-guaranteed, which encourages lenders to offer favorable terms. They can be used for start-ups, acquisitions, working capital, and more, but often involve extra paperwork.

Conventional Loans

These loans come from banks or other financial institutions without a government guarantee. They might have a quicker approval process but often come with higher rates and shorter terms.

Understanding Loan Fees

Business loans usually involve fees beyond just the interest. These can significantly impact the total cost of the loan.

• Origination Fee: A fee for processing and approving the loan, typically 1-6% of the loan amount.
• Documentation Fee: A charge to cover the cost of processing paperwork.
• Other Fees: Can include monthly administrative fees, late payment penalties, or prepayment penalties.

The Bottom Line

All these fees can make the actual cost of a loan higher than the stated interest rate. Our calculator accounts for these expenses to compute the loan's true APR, giving you a clear understanding of what you'll really pay.