Calculate Your Business Loan Costs with this Tool


Fully 82 percent of businesses fail due to poor cash management according to Business Insider. The world is full of small business owners who keep saying “profit? I never see any of that!” They’re making tons of sales. Their books show they’re making profits. But there’s just no cash. Such businesses need to watch their costs more closely even as they work hard to push revenue up.

Business Costs

Most businesses that don’t keenly watch their costs often vanish as quickly as they appeared. Whether a company uses an in-house accountant or outsources accounting tasks, it must keep a firm grip on its finances. The owner needs to know when payments to creditors will fall due. They should keep reminding debtors to pay. Some business owners pay their bills before their customers do. That often causes financial problems. Whether it’s financing costs, salaries and wages, electric and water bills, taxes or supplies, a company must know its costs.

Financing Costs

Whether a business is a small mom-and-pop shop or a large national retailer, its owners need to raise capital continually. Most entrepreneurs admit that finding financing is their most challenging job. Some save their way into the funds they need for growth, but most rely on debt. According to the Kauffman Foundation, banks provide roughly 40 percent of most businesses’ startup capital.

Debt repayment can result in severe financial trouble if poorly managed. Entrepreneurs must understand how the various business loan costs affect their cash flow now and in the future. That’s where accurate and easy-to-use business loan costs calculation tools like this one can help.

Understanding Business Loan Costs

Each monthly installment contains two critical components. These are the principal and interest. But these are not the only costs. There is also the closing fee, documentation fee, and funding fee to consider. Typically, costs other than interest are not part of the monthly installment. The lender subtracts such amounts from the loan value on the funding day.

An accurate and detailed business loan costs calculator enables one to see each cost involved. Such a calculator consolidates all the components so one can quickly see the final figure. Most importantly, the right tool calculates the installment payable each month. Knowing that information helps a borrower decide whether the cash flow is sufficient to support loan repayment.

How Much Money?

How much capital does an entrepreneur need to borrow? Sitting down with an accountant should help a business owner decide how much cash the company needs. One should neither borrow too much nor too little. The cash flow statement assesses the ability of a business to pay the monthly installment when it falls due.

Using this Business Loan Costs Calculator

It is pretty much straightforward. Enter Camino Financial business loan calculator and follow these simple steps:

Step 1

The business loan calculator features only three required fields. These are Loan Amount, Payment Term, and Monthly Interest Rate. The monthly rate ranges from as low as 1 percent to slightly over 2 percent. The repayment period extends from 24 to 60 months.

Step 2

Let’s assume a business needs $50,000 repayable over 24 months at a monthly interest rate of 1 percent. Just type in $50,000 in the Loan Amount Field, 24 months in the Payment Term field, and 1 percent in the Monthly Interest Rate field. That takes about two seconds or so. Finally, hit “Calculate.” It’s that easy.

Review the Results

The business loan costs calculator takes about a second to work out the results. The tool shows you’re supposed to pay a closing fee of $3, 495. The monthly installment is $ 2,353.67.  The loan costs amount to $9,983.17.  That means the total interest payable is $6,488. 17. Should you borrow? Yes, if the expected gains exceed the total loan cost and cash flow allows. Camino Financial doesn’t charge funding and documentation fees. Feel free to check their business loan products.


With the free business loan calculator, a business owner can quickly learn how much money will start flowing out of their business should they borrow. Cash flow strength and the expected returns determine whether taking out the loan makes sense. Get accurate numbers before you start the loan application process.

Monica Lynn Williams

Monica is an experienced professional in the world of business, finance, literature, cryptocurrencies and IT. Having been in the writing industry for the last 12-years, she has spent most of her career time writing articles, blog posts, products reviews, tech texts, and buyers guides. Monica also writes for Camino Financial, an online lender for business loans.


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