This estimator calculates business loan repayments from the amount, the annual interest rate and the term in months, returning the monthly payment, total interest and total repaid on a standard fixed-payment loan. Aspenwater Credit, a small-business funding broker in Dover, Delaware, provides it for Kent County owners as illustrative arithmetic, not a quote or an offer.
What to enter
- Amount: the sum you would receive, before any fees the partner deducts.
- Interest rate: the annual note rate stated in the offer, as a percentage.
- Term: the number of monthly payments.
The estimator assumes equal monthly payments that pay the amount down to zero by the last payment, with interest calculated monthly on the remaining balance.
What it returns
- Monthly payment: the fixed payment each month.
- Total interest: all payments added together, minus the amount.
- Total repaid: every payment added together.
It does not produce a month-by-month schedule, handle weekly or daily payments, include fees, or model a balloon. Those are covered below as steps you work by hand or ask the partner to provide.
How to calculate business loan repayments by hand
The standard formula for a fixed monthly payment is: payment = amount × r ÷ (1 − (1 + r)−n), where r is the annual rate divided by 12 (as a decimal) and n is the number of months. Total repaid is the payment times n; total interest is that minus the amount.
To check the arithmetic only, take a hypothetical rate of zero: $18,000 over 36 months gives a payment of $500, total interest of $0 and $18,000 repaid. Raise the rate above zero and both the payment and the interest go up. These figures test the method and are not an offer.
What you work out yourself
- Fees: if the partner deducts an origination fee, you receive less than the amount. Add the fee to the total interest to see the full cost in dollars.
- Weekly or daily payments: the estimator shows monthly figures only; ask the partner for its actual payment schedule and total.
- Comparing two terms: run the same amount at two terms and compare the total repaid, not just the payment.
- Paying off early: ask the partner for the payoff figure at a given date; prepayment terms vary.
A merchant cash advance cannot be modeled here because it is not a loan and has no interest rate; the advance page explains how its cost is worked out.
Where the inputs come from
For a term loan, the offer states the amount, rate and term. For working capital financing, terms are shorter and payments are often weekly, so read the total of all payments in the offer alongside the monthly estimate. Other tools and guides are on the resources page.
By Aspenwater Credit · Updated