Calculate your business loan payment, total interest, and amortization schedule, including an optional balloon payment.
Rates as of Q2 2025 (example)
| Period | Date | Payment | Principal | Interest | Balance |
|---|
A business loan calculator estimates your monthly payment, total interest, and amortization schedule for a business term loan, with the option to include a balloon payment — a large lump sum due at the end of the loan term, after a series of smaller regular payments. This structure is common for some business and commercial loans, where the smaller monthly payments are based on a longer amortization period than the actual loan term.
When a balloon payment is included, the monthly payment is calculated so that the present value of all the regular payments plus the present value of the balloon payment equals the loan amount — effectively amortizing only the portion of the loan that isn't covered by the balloon.
Formula: Monthly Payment = [(P − Balloon ÷ (1+r)n) × r] / [1 − (1+r)−n], where P is the loan amount, r is the monthly interest rate, n is the number of months, and Balloon is the lump-sum amount due at the end of the term. With no balloon payment, this simplifies to the standard amortization formula.
Example: For a $100,000 business loan at a 9% interest rate (example rate — enter your actual rate) over 7 years with no balloon payment, the monthly payment would be roughly $1,613, with total interest of about $35,500 over the full term. Adding a balloon payment would lower the monthly payment but leave a lump sum due at the end. (Note: all figures in this example are for illustration purposes only and do not represent your actual loan terms.)
Business loans in the US come in many forms — traditional bank term loans, SBA (Small Business Administration) loans with government-backed guarantees, equipment financing, lines of credit, and commercial real estate loans, each with different typical rates, terms, and qualification requirements. Rates as of Q2 2025 (example) varied significantly by loan type and lender, often higher than residential mortgage rates and dependent on the business's revenue, time in operation, and the owner's personal credit. Balloon payment structures are sometimes used in commercial lending, where the borrower makes payments based on a longer amortization schedule (lowering monthly cash flow needs) but must pay off or refinance the remaining balance at the end of a shorter actual term (example structure — verify your specific loan's terms).
A balloon payment is a large lump-sum payment due at the end of a loan term, after a series of smaller regular payments calculated using a longer amortization period. It lowers monthly payments but requires the borrower to pay off or refinance the remaining balance when due.
No — the default is an example only. Business loan rates vary significantly based on the loan type (term loan, SBA loan, equipment financing, etc.), the lender, and your business's creditworthiness and time in operation. Enter the actual rate quoted to you.
An SBA loan is a loan partially guaranteed by the US Small Business Administration, issued through participating lenders. The government guarantee can allow for more favorable terms than conventional business loans, though the application process can be more involved.
If you can't pay the balloon payment in cash, common options include refinancing the remaining balance into a new loan, selling the financed asset, or negotiating with your lender — but these options aren't guaranteed, so planning ahead for a balloon payment is important.
No. This calculator estimates principal and interest payments only. Business loans often involve additional fees — such as origination fees, closing costs, or annual fees — that would add to your total cost and aren't included here.
Extra payments reduce your principal balance faster, which can reduce the size of the balloon payment due at the end of the term (or eliminate it entirely if the loan is paid off before the balloon date), in addition to reducing total interest paid.
Disclaimer: The information, rates, and figures provided on this page are for educational and illustrative purposes only. All rates and examples shown are sample values and do not reflect the actual rate, fees, or terms offered by any specific lender. Financial rules and lending terms change frequently. Always consult your lender or a qualified financial advisor before making any financial decisions.