We’ve updated this guide with more information on how to effectively use our business calculator?including what kind of numbers it tells you and how you can use those numbers to make better borrowing decisions.

Business Loan Calculator

Small businesses can now receive government aid to meet payroll through the Paycheck Protection Program. The program costs $349 billion of the $2.2 trillion stimulus package and allows small businesses to receive money totaling 250% of their average monthly payroll in 2019.

The loans max out at $10 million and can be used at the discretion of the business. The loan can be forgiven, however, if certain requirements are met. If no employee is compensated above $100,000 and at least 75% of the money goes to paying workers, the entire loan may be forgiven.

Loans that are not forgiven must be repaid in two years at a 0.5% interest rate after six months of interest deferment.

The only way to apply for these loans is through an SBA authorized lender. Applications open on Friday, April 3, and close on June 30. The application consists of a two-page form in addition to required documentation.

Concerned about how to recover from the effect COVID-19 has had on your business and its finances? Well, you might qualify for special disaster loans from the U.S. Small Business Administration (SBA). Businesses can get loans up to $2 million, and these loans have an interest cap of 3.75%. The SBA website has more information.

Taking out a loan for your small business? Congratulations! Getting a loan opens up all sorts of opportunities for business growth, making it an exciting financial milestone for many businesses.

Of course, that exciting milestone could become a shocking and disappointing one when you find out that your $100,000 loan will cost you $152,000 by the time you pay it back.

So before you borrow, use a loan calculator to figure out the actual cost of your small-business loan. It will save you from nasty sticker shock and help you find the right loan for your small business.

Still deciding on the best business loan for you? Use our best small business loans guide to find the right fit.

To get the most accurate total cost estimate, you’ll need to gather a little information before you use a business loan calculator:

• Loan amount (how much you’re borrowing)
• Interest rate
• Loan term (the time you have to repay the loan, which affects your number of monthly payments)
• Extra monthly loan payment amount (if you plan to pay more than the minimum)

You don’t need to have the exact numbers-after all, you probably won’t know your final interest rate until you get approved for your loan-but more accurate numbers will give you more accurate results (obviously).

Once you put in all those numbers, just click the button to have the calculator do the math for you. And there you go-the total cost of your loan.

You can also use a loan calculator to see how different rates, terms, or payments would affect the total cost of your loan. So if you’re deciding between a loan with a longer repayment term and a lower rate and a loan with a shorter repayment term and a higher rate, you can use a calculator to find out which one offers the better deal.

How to get the most out of a loan calculator

Like we said, a loan calculator can show you the total cost of your loan (the loan principle plus any interest you’ll owe). And that’s great for seeing how much a loan will cost your business in the long run (because boy, interest can add up quickly).

But a loan calculator can give you plenty of other useful information?information that can help you make smarter, more informed decisions before you take out a loan.

• Total loan payback amount
• Estimated monthly payment
• Percentage of total repayment that goes to principle vs. interest
• Principle vs. interest amount for each payment (an amortization table)

So if, for example, you’re trying to decide between a loan with a longer repayment term and a lower interest rate (say, 10 year and 5%) and a loan with a shorter repayment term and a higher interest rate (like 7 years and 8%), the loan calculator can help you decide which to go with?whether you want the lower total payoff amount or the lower monthly payment.

Likewise, a loan calculator can see if your monthly loan payment will fit in your business budget, if it’s worth shopping around for a better interest rate, and so on.

Of course, you need to remember that a loan calculator is giving you estimates?so make sure you ask a lender for hard numbers before you commit to a loan.

Even so, a calculator’s estimates can give you plenty of information to help you choose the best loan for your business.