What is Business Loan Calculator?
Computes debt service requirements for commercial enterprises, working capital loans, and Small Business Administration (SBA) financing.
How to Use This Calculator
- Enter loan principal.
- Enter interest rate and loan term.
- Add origination fee percentage.
- Review monthly debt service and annual cash flow requirements.
The Mathematical Formula & Variables
Monthly Installment = Principal * (r*(1+r)^n) / ((1+r)^n - 1)
Step-by-Step Worked Example
Scenario: $200,000 loan at 7.5% over 10 years (120 months).
- r = 0.075 / 12 = 0.00625; n = 120.
- Monthly payment = $2,374.04.
- Annual debt service = $28,488.48.
Result: $2,374.04 / month
Frequently Asked Questions
What is Debt Service Coverage Ratio (DSCR)?
DSCR is Net Operating Income divided by Annual Debt Service. Commercial lenders usually require a DSCR of at least 1.25x.