Small Business Administration (SBA) loans offer low-interest financing to small businesses that struggle to qualify for a bank loan. This calculator can give you an estimate of your loan payments and the total interest cost of most SBA loans. To use this business loan calculator, enter the loan amount, interest rate and repayment term you expect to receive.
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To use this SBA loan calculator, you’ll need an estimate of the loan amount, interest rate and term you expect to receive on your government-guaranteed loan. If you haven’t prequalified for an SBA loan yet, you might not have those numbers on hand. But you can still get a rough estimate based on limits that the SBA sets on these loans.
Most SBA loans are available between $50,000 and $5 million, though there are some exceptions.
The loan amount your small business needs might affect the SBA loan program you decide to apply for.
The SBA also sets limits to how much lenders can charge in interest for each loan program. In most cases maximum interest rate also varies depending on your loan amount and repayment term.
Here’s how interest rates break down by loan amount for loans with a term of less than 7 years:
Here’s how interest rates break down by loan amount for loans with a term of 7 or more years:
This doesn’t apply to all SBA loans, however. Make sure you’re using interest rates that fit into the range available for the loan program you’re considering.
Most SBA loan programs come with a maximum term of 10 years for working capital expenses and 25 years for real estate expenses.
But the loan term you receive typically depends on what you’re funding. For example, if you plan on using the SBA loan to buy a piece of equipment, then the loan term is based on on how long your lender expects that equipment to be usable.
Consider how long you expect to receive revenue from the project you need to finance when estimating your loan term.
SBA 504 payments work a bit differently than your typical SBA 7(a) loan. SBA 504 loans are generally used for real estate purchases, according to Mike McGinley, EVP of Small Business Banking at Live Oak Bank — one of the most active SBA lenders in the country. These are funded by three parties: a bank, the SBA through a Certified Development Company (CDC) and through a down payment by the business owner.
Because SBA 504 loans are more complex than a 7(a) loan, it can take some time for the loan to be fully disbursed. During this time, most SBA 504 borrowers take out a bridge loan from a bank or another lender that specializes in 504 financing. These are short-term loans that you pay off with the funds from your 504 loan once it’s disbursed.
“During the bridge period, the borrower will make payments to the bridge lender directly,” says McGinley. “But once the bridge loan is paid off by the SBA debenture, the borrower makes payments directly to the CDC.”
This business loan calculator can give you a general estimate for the monthly payment and total interest cost to expect on an SBA loan. But it can’t tell you everything you need to know before you sign on to an SBA loan.
This calculator can only give you an estimate of your SBA loan payments based on the rates, loan amount and term you expect to get. But your payments may be different.
“The SBA loan payment is often subject to change,” according to McGinley. “Loan amount, rate and term are all drivers of the monthly payment, and this cannot be fully determined until the borrower applies and you get a full loan package.”
SBA loans come with a wide range of possible fees compared to other small business loans. Here are the most common fees for SBA 7(a) loans:
Other fees may apply — especially if you receive a loan that isn’t part of the 7(a) program.
This SBA loan calculator might not give an accurate estimate of payments on a Paycheck Protection Program (PPP) loan for Economic Injury Disaster Loan (EIDL). That’s because these COVID-19 assistance programs come with deferred terms, which this calculator doesn’t factor in.
This calculator doesn’t provide an amortization schedule, which breaks down each payment by the amount that goes toward interest and principal. You can get an estimated amortization schedule by prequalifying with an SBA lender.
However, this may not be as useful as it sounds. “A lot can change once the lender receives an application,” McGinley says. “An amortization schedule will just give you the payment amount, and how much of the payment goes towards principal and interest.”
Businesses that are profitable after making their SBA loan payments may want to consider paying off their loan early to get out of debt faster and save on interest. Prepaying your loan can lower the total cost of your SBA loan in some cases.
But you may sometimes need to pay a prepayment penalty, which reduces the savings of paying off your loan early.
“For 7(a) loans with a term less than 15 years, there are no prepayment penalties,” McGinley says. “For 7(a )loans with a term greater than 15 years and 504 loans, there is a prepayment penalty. However, borrowers can prepay up to 25% of the loan balance in any given year without penalty.”
You also can’t partially pay an SBA 504 loan, according to McGinley.
This SBA loan calculator is meant to help small businesses get an estimate on the monthly payments and total cost of an SBA 7(a) loan.
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