Phase 1 · Core Sovereign Layer
Business Loan Amortization Calculator
The headline rate hides the real cost. Add the origination fee to see your true APR, your monthly payment, and the full price of borrowing — so you compare loan offers on honest terms.
Under the hood
The math, fully exposed
We amortize the stated rate, then re-solve the APR against what you actually received:
Monthly payment = amount × r ÷ (1 − (1 + r)−n) (r = APR ÷ 12)
Total interest = payment × n − amount
Origination fee = amount × fee %
True APR = rate where (amount − fee) = payment × annuity factor
- The fee is interest in disguise: you repay on the full amount but receive less, so the real rate sits above the sticker — that's the number to compare offers on.
- Payment hides total cost: a low monthly figure can come from a long term that quietly adds years of interest. Judge the total cost to borrow.
- Term is a cash-flow lever: stretching it lowers the payment and raises the total — match it to the life of what you finance.
Your directives
What to do next, based on your numbers
Adjust the sliders to generate tailored recommendations.
Answers
Frequently asked questions
How is a business loan payment calculated?
A fixed-rate loan is amortized: each monthly payment is part interest, part principal, sized so the balance hits exactly zero at the end of the term. The formula is payment = principal × r ÷ (1 − (1 + r)−n), where r is the monthly rate and n the number of months. Early payments are mostly interest; later ones are mostly principal — but the payment itself stays constant.
Why does the origination fee change the true APR?
Because you pay interest on the full loan amount but only receive the amount minus the fee. A $100,000 loan with a 3% origination fee puts $97,000 in your pocket, yet you repay as if you borrowed $100,000. That gap raises your effective cost above the stated rate. The true APR is the rate that reconciles what you actually received with what you actually repay — always at or above the headline rate.
What counts as the real cost of borrowing?
Total interest over the life of the loan, plus the origination fee and any closing costs. The monthly payment alone hides this — two loans with the same payment can cost very different amounts depending on term and fees. Comparing the total cost of borrowing (interest + fees) is the honest way to choose between offers, not just the lowest monthly number.
Is a longer term cheaper?
It lowers the monthly payment but usually raises the total cost, because you pay interest for more years. A longer term can ease cash flow when that matters, but you pay for the flexibility. Shorter terms cost more per month and less overall. Match the term to the life of what you are financing, and weigh cash flow against total interest. This is an educational model, not financial advice.