How the estimated rate is calculated
This calculator estimates the nominal annual rate implied by the cash you receive and the equal payments and fees you enter. It also shows the underlying payment rate and total cost, so you can compare offers on consistent assumptions.
For monthly payments, it multiplies the monthly rate by 12; for weekly payments, it multiplies the weekly rate by 52. Fees paid at the start or with each payment are included in the cash flows. US Regulation Z generally exempts business-purpose credit from its disclosure rules, so this estimate is not a lender-disclosed or legally prescribed APR. It also does not model every possible fee definition or actual payment date.
Worked example: $100,000 at $1,634.40 a month
A $100,000 loan repaid at $1,634.40 a month for seven years has an interest rate of 9.50%. With a 2% origination fee of $2,000 deducted from the loan, you receive $98,000 and the estimated APR is 10.15%, so the fee adds 0.65 percentage points.
You repay $137,289.60 in total, of which $37,289.60 is interest. With the fee, the total cost of borrowing is $39,289.60, which is 39.29% of the loan. The equivalent flat rate, the interest as a share of the original loan for each year, is 5.33%.
A published example from Balboa Capital
Balboa Capital's published example is a $50,000 loan at 8% with a 3% origination fee. Its published 12-month payment is $4,349.42 at 13.77% APR; the 36-month payment is $1,566.82 at 10.08%. This calculator estimates 13.77% and 10.08% under the same cash-flow assumptions, with the fee adding 5.77 and 2.08 percentage points respectively.
Where the origination fee goes
A fee can be deducted from the loan, added to it or paid separately. On $40,000 with a 3% fee of $1,200 added to the loan and $250 of closing costs paid in cash, repaid at $1,300 a month for three years, you owe $41,200.00 at the start. The interest rate is 8.47% and the estimated APR is 10.93%, with a total cost of borrowing of $7,050.00.
Fixed fees and fees with each payment
A fixed fee is a single charge on the loan. An 8% fee on $25,000 is $2,000.00. Repaid in 39 weekly payments it is $692.31 a week and the estimated nominal APR is 20.30%, equal to a flat rate of 10.67% a year. The faster you repay a fixed fee, the higher the implied annual rate.
Some lenders add a servicing fee to every payment. On $30,000 repaid at $305 a week for 104 weeks with a 1.5% origination fee and a $10 fee with each payment, the fees come to $1,490.00 and the estimated APR is 10.40%, far above the 5.58% interest rate.
What this calculator leaves out
This is a planning calculator for a fixed agreement with equal payments at regular intervals. It does not model a variable rate, an interest-only start, a balloon payment, a prepayment penalty, irregular payment dates or a payment that changes with your sales. US Regulation Z generally exempts business-purpose credit from its disclosure rules, and lender methods may differ, so this estimate is not a lender-disclosed APR. Check the figures in your loan agreement.
To model a loan from its rate and fees, use the business loan calculator .
For short-term advances, use the working capital loan calculator .
Use the right country page
This page stays in US dollars and uses US terms such as origination fee and closing costs. The result multiplies the periodic rate by 12 or 52 for a nominal annual estimate. The country choices above the inputs open separate local pages. Choosing United Kingdom opens the business loan APR calculator, which uses an arrangement fee, flat rates and an effective annual estimate. Inputs reset and amounts are not converted.
Inputs for the US business loan APR calculator
Loan amount
The loan amount on the offer, before any fee is taken from it.
How the offer is priced
A regular payment or a fixed fee on the loan.
Regular payment
From the offer. Used when the offer is a regular payment.
Fixed fee
A percentage of the loan. Used when the offer is a fixed fee.
Term and payments
Enter years or months for monthly payments, or the exact payment count for weekly payments.
Origination fee
A percentage of the loan, and whether it is deducted, added or paid separately.
Fee with each payment and closing costs
A fixed fee charged with every payment, and fixed costs paid in cash at the start.
CALCULATOR QUESTIONS
US business loan APR calculator questions
How do you estimate the annual rate of a business loan?
Find the periodic rate at which the payments repay the cash you receive after fees, then annualise it. $1,634.40 a month on $100,000 over seven years with a $2,000 fee deducted gives an estimated 10.15%. This is not a lender's disclosed APR.
What is the difference between the interest rate and the APR estimate?
The interest rate is charged on the balance. This fee-inclusive estimate also reflects the cash you receive after fees. A 2% origination fee lifts a 9.50% rate to an estimated 10.15%.
Is the origination fee deducted from the loan?
Often yes, so you receive less than you borrow. Choose deducted, added or paid separately to match your offer.
How much does an origination fee add to the APR estimate?
It depends on the term. On a $50,000 loan, a 3% fee adds 5.77 percentage points over 12 months and 2.08 over 36 months.
Does a fixed-fee advance have an APR?
There is no standard lender APR for every fixed-fee product. The calculator treats the fee as a flat charge repaid in equal weekly payments, so an 8% fee over 39 payments gives an estimated nominal annual rate of 20.30%.
What happens when I change country?
The United Kingdom option opens the separate business loan APR calculator, in pounds, with an arrangement fee and flat-rate quotes. Your inputs are reset rather than converted.