Business Term Loan Calculator

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How to Use The Business Term Loan Calculator

Estimate Your Payments
Estimate How Much You May Qualify For
Terms and Explanation
What is a Business Term Loan?
How to Calculate Payments for Business Term Loans
Easy Ways to Reduce the Cost of Business Term Loans

Estimate Your Payments

To make the best use of this business term loan calculator, you’ll need a few additional pieces of information. The calculator requires the following:

From the calculator, you will get estimated monthly payment, origination fee, and total repayment.


Estimate How Much You May Qualify For

You can estimate how much you may qualify for if you take out a business term loan. Once you fill out your information, the calculator will give you a range of dollar figures within which you may be able to borrow. This will give you an idea of the types of expenses you may cover and whether or not you might need to seek additional financing elsewhere. The inputs for this calculator include:

Business Start Date

This is the month and year your business officially started operations.

Annual Revenue

This refers to the total amount of money your business makes during a 12-month period.

Last Month’s Deposits

This reflects how much money you deposited into your business bank account in the previous month.

Estimated Credit Score

This is where you select your business’ estimated credit score.


Terms and Explanation

Here are the essential pieces of information you’ll need to enter and notice as outputs on our business term loan calculator.

Amount Seeking

The amount seeking refers to how much money you’d like to receive from a business term loan. This can be anywhere from a few thousand dollars to $100,000, depending on the lender and your financial situation. 

Loan Term

This refers to the length of the loan or the length of time it will take you to completely pay it off, assuming you make your regularly scheduled payments. Business term loans come with short terms and long terms.

Annual Rate

The annual percentage of rate (APR) is the cost to borrow money, expressed as a yearly percentage. It includes your interest rate, plus additional fees associated with taking out your business term loan.

Estimated Monthly Payment

Estimated monthly payment is what you’ll pay each month to repay your business term loan. It can give you an idea of how a business term loan might fit with your budget.

Total Repayment

Total repayment shows the total cost of your loan. This includes the entire principal, interest, and fee amount you’ll pay over time.

Origination Fee

The origination fee is designed to cover the costs of processing your loan application and approval. It’s typically expressed as a percentage of the total loan amount. Most origination fees average around 5%.


What is a Business Term Loan?

The term loan is one of the most popular small business loan options. It’s not flashy or fancy—it’s just the straightforward, classic way to finance your business.

With business term loans, amounts range between $5,000 and $2,000,000, and terms range between one and five years. To qualify for a term loan, you’ll need to have a profitable business that has been established for at least two years. And when you apply through Lendio, you can typically gain access to the funds in as little as 24 hours after approval.

Because the term loan is flexible, you can use it for just about any business need. You can leverage a term loan to:


How to Calculate Payments for Business Term Loans

Our business term loan calculator does the math for you so you can anticipate the monthly loan payments you would be expected to make if you took out a business term loan. The following four components contribute to your monthly payments.

1. Business Term Loan Amounts

Business term loans typically range from $5,000 to $2,000,000. The amount you qualify for will depend on your revenue, time in business, and credit history, in addition to other factors.

2. Business Term Loan Interest Rates

The interest rate is largely based on your credit history. If you have excellent credit, your interest rate can be as low as 9%. If you have some negative marks on your credit history, you can often still qualify for a business term loan, but you’ll likely end up with a higher interest rate.

3. Business Term Loan Terms

The terms for this type of loan are typically between one and five years.

4. Business Term Loan Origination Fees

The origination fee on a term loan is typically about 5%, so you’ll want to factor this in when determining the total cost of your loan. Note that you won’t need to pay this fee while shopping around for a loan. Your origination fee will either be due at signing or rolled into the overall cost of your loan.

5. Application Fees? Not at Lendio.

Applying for and reviewing your loan options through Lendio is always free—however, many lenders will charge you application fees. It’s always a good rule of thumb to ask about potential application fees before starting the process with a lender.


Easy Ways to Reduce the Cost of Business Term Loans

The term loan is pretty inexpensive as business financing options go—but your costs can get out of hand if you’re not diligent about making your monthly minimum loan payments.

Avoid late fees and boost your credit score by paying on time, every time. You can easily stay in good standing by calendaring your due dates or setting up automatic payments. If you run into a financial snag and are worried you might not be able to make a payment, don’t keep it to yourself—contact your lender immediately to explore your options.

It’s also a smart idea to ask about prepayment penalties. Some lenders will reward you with a discount for paying off your loan early, while others will impose additional fees for doing so. Always be sure to review any potential discounts, penalties, and fees associated with your loan before finalizing the paperwork with your lender.

FAQs

Business term loans may be short-term, which range from a few months to 24 months. Long-term loans go up to 10 years or even longer in some cases. While a longer term will lead to lower payments, it will cost you more in interest over time.

  

Factors like your lender, your credit score, and business finances will influence your interest rate. Average interest rates on business term loans, however, may be anywhere from 6% to 44% or more. The lowest rates are reserved for stable businesses with good credit.

 

Term loans usually come with favorable rates and repayment terms, making them harder to qualify for than other loans. But some lenders have lenient criteria and may approve you, even if you have bad credit or haven’t been in business for very long.

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