Business Loan Payment Calculator
Calculate the monthly payment, total interest and total cost of a business loan from its amount, interest rate and term.
How it works
Payment = P × r ÷ (1 − (1 + r)^−n), where r = annual rate ÷ 12 and n = months · Total interest = payment × n − principal
A term business loan amortizes like a mortgage: each fixed monthly payment covers the month’s interest first, with the rest reducing principal, so early payments are mostly interest and later ones mostly principal. Business loan rates are typically higher than home loans because they are riskier and often shorter, which raises the monthly payment even though less interest accrues over the shorter term. Watch for origination fees and prepayment penalties, which this base calculation excludes.
Worked example
Borrowing $100,000 at 9.5% over 5 years (60 payments) gives a monthly payment of about $2,100, for roughly $26,000 of total interest and $126,000 repaid over the life of the loan.
Frequently asked questions
Does this include fees?
No. It covers principal and interest only. Origination fees, closing costs and any prepayment penalty add to the real cost — factor those into the APR when comparing offers.
Is business loan interest deductible?
Interest on a loan used for business purposes is generally deductible as a business expense, which lowers its effective cost. The principal repayment is not deductible.
How can I lower the monthly payment?
A longer term reduces the monthly payment but increases total interest; a lower rate or larger down payment reduces both. Compare the total-interest figure, not just the monthly number.
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Educational estimate using simplified US federal rules — ignores state tax, credits and your full situation. Not tax advice; confirm with a CPA or IRS guidance.