This business loan affordability calculator from Keelpark Capital Group, a small-business funding broker in Jackson, Tennessee, computes the monthly payment, total interest and total repaid for an amount, rate and term you enter, so you can compare it with the spare cash your business has in its slowest month. Results are illustrative arithmetic, not an offer.
Step 1: Find your spare monthly cash
- From your bank statements, take the deposits for each of the last several months.
- Subtract that month's operating costs: wages, rent, supplies, utilities, taxes.
- Subtract the payments on debts and advances you already carry.
- Look at the smallest result, not the average. That is the month the new payment has to survive.
Hypothetical example, for illustration only: a business whose leanest recent month left $3,000 after all costs and existing payments should be wary of any new payment that would take most of that $3,000.
Step 2: Decide your cushion
Lenders look for cash flow comfortably above the payment, and so should you. Decide how much of your spare cash you are willing to commit, leaving room for a slow month, a repair or a late customer. Each lender sets its own coverage requirements; your own cushion is a separate, personal decision.
Step 3: Try amounts, rates and terms
Enter an amount, an annual interest rate and a term in months. Use figures from an offer you hold, or test numbers of your own. The calculator returns the estimated monthly payment, the total interest and the total repaid. If the payment is above the share of spare cash you decided on, try a smaller amount or a longer term, and note how the total interest changes.
What the result leaves out
- Origination, closing and other charges, which add to the cost
- Weekly or daily payment schedules; convert them to a monthly figure before comparing
- Variable rates that can change during the term
- Balloon payments due at the end of some loans
How is a working capital loan amount determined? By the partner, usually from deposits, existing debts and credit. This tool does not predict what a partner will offer; it shows what a payment would do to your cash flow.
Using the result
Bring the figures to the conversation: your spare monthly cash, the payment you are comfortable with, and the purpose. See working capital or term loans for how each is repaid, and the MCA vs. term loan calculator to compare an advance.
By Keelpark Capital Group · Updated