The calculator works out level monthly payments only. It does not model interest-only months, fees or changing balances. Nothing typed into it is sent anywhere. The examples are invented and computed for illustration.
A monthly factor rate is not an annual rate: what to enter here for a Robertson County, TN auto repair shop
This calculator needs an annual interest rate. A quote given as a monthly interest rate converts by multiplying by 12: 1.05% a month is 12.6% a year. A factor rate from a merchant cash advance offer is a different thing, a multiplier with no time in it, and belongs in the calculator on the merchant cash advance page.
An auto repair shop holding both kinds of offer can run each one in its own calculator and set the dollar totals side by side.
A line of credit rate can also move during the life of the line if the agreement ties it to an index. The calculator holds one rate for the whole term, so a variable-rate line is worth running twice: once at today’s rate and once at a higher one, to see how much room the monthly budget has.
Line of credit calculator payment: a Springfield, TN plumbing contractor paying down a $14,750 balance over nine months
Illustration only, invented figures: a plumbing contractor has $14,750 drawn on its line at 12.35% and plans to clear it in 9 equal payments. Entered here as $14,750, 12.35% and 9 months, the balance takes $1,724.37 a month, $15,519.33 across the nine payments, with $769.33 of that as interest.
Enter the term in months. Typing 1 for a one-year term asks for the whole balance in a single month, about $14,901.80, a payment far higher than the twelve-month figure.
The three results answer different questions. The payment is the monthly load on the budget. Total interest shows what spreading the balance costs. The total repaid is the balance plus that price, the figure to compare against paying the line down sooner from cash.
Business line of credit calculator vs interest-only months: a Robertson County, TN landscaping company’s payroll draw
Invented figures for illustration: a landscaping company draws $9,600 to meet payroll, priced at 12.8%. If it pays only interest for the first month, that month costs $101.00 for 30 days on a 365-day year, worked by hand because the calculator does not do interest-only months.
Interest-only months keep the payment small while the balance stays where it is, so every such month adds its interest without bringing the payoff any closer. Running the level-payment figure right after shows the cost of waiting.
If the company then turns the full $9,600 into 6 level payments at the same rate, the calculator gives $1,660.26 a month, $9,961.56 in total and $361.56 of interest, on top of the interest-only month.
Commercial line of credit calculator: two fixed paydown plans for a Springfield, TN builder’s materials balance
| Paydown term | Monthly payment | Total of payments | Interest |
|---|---|---|---|
| 12 months | $2,447.71 | $29,372.52 | $1,772.52 |
| 18 months | $1,678.62 | $30,215.16 | $2,615.16 |
The 18-month plan lowers the payment by $769.09 and carries $842.64 more interest. Totals use the rounded payment times the months, so they can differ by cents from what the calculator shows. The line of credit page explains how the line itself works.
A builder whose house sales close at different times may prefer the payment that fits the leanest month, and accept the extra interest as the cost of that room. The calculator lets the owner try terms in between, such as 14 or 15 months, before talking to a partner about a paydown plan. Checklists and the Tennessee home improvement license guide sit on the resources page.
By Swiftpine Loans · Updated