DOWNLOAD PDF BUSINESS INTEREST CALCULATIONS

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1 Chapter 1 : Business loan calculator - calculate repayments - NAB Take the business loan and interest rate calculator for a test drive today. Get answers with blog.quintoapp.com Particularly with small business loans, interest rates should be reasonable to help the. Change the frequency of compounding during a cash flow No compounding option when rate changes Using UFC as a Mortgage or Loan Payoff Calculator A well-designed loan payoff calculator will answer any of these questions: How many payments do I have left? When will my loan be paid off if I make extra payments? What payment is required to pay a loan off by a given date? The borrower missed payments, paid late and paid additional amounts and there were interest rate changes, what is the exact loan balance due as of today? Answering the first three questions is straightforward and takes but a second, but, as you may have guessed, calculating the payoff amount for the fourth scenario is more involved. For instructions on how to use the UFC as a tool for tracking a mortgage or loan balance with payment and interest rate changes, read my tutorial Calculate Loan Balance â Loan Payoff Calculation. In the 2nd row enter the due date of the next payment after the loan balance date in row one this may also be the balance date, enter the scheduled payment amount, set " Periods" to "Unknown" and set the payment frequency monthly. Your screen will look like this: Loan payoff calculator setup After clicking "Calculate," your screen should look like below. There are remaining payments, and the last payment will be due on August 1. Loan payoff result showing payments remaining and due date of the last payment. The UFC excels as an early payoff calculator. Example showing early loan or mortgage payoff calculator setup Click "Calculate" once again. Your screen should look like below. Now only payments are remaining, and the last payment will be due on September 1 a year earlier. Early payoff result showing payments remaining and due date of the last payment. You can also specify the number of remaining payments and set the amount to "Unknown" in row two and the calculator will calculate the total payment amount required to have the loan paid off in the number of payments you specify. Financial Calculations Step-by-Step Tutorials The below tutorials walk you through the steps for setting up the indicated financial calculation. I recommend that you right click on a link and select "Open in New Window" so you can have the calculator handy in this window as you read. Page 1

2 Chapter 2 : Business Loan Calculator Calculate Yours Citizens Bank Related Loan Calculator Interest Calculator. Business Loan Fees. Origination Fee. This is a fee charged for processing loan application and approval, which may include verification of a borrower's information. Current Mortgage Rates What You Need to Know About Commercial Property Financing Obtaining a business real estate advance is a lot more difficult than getting a home advance, and you need to be prepared for a grueling process that has many twists and turns - and sometimes a surprise ending. And then you have to consider how risky the process can be for you personally. In the event that your commercial lender turns you down at the last minute after the wheels have already started to turn, you might even have to declare bankruptcy. If you are turned down and need to start a new application, you may have to pay for all of these third-party reports again. To make the game even riskier, there are many impostors masquerading as direct commercial lenders, and they are only interested in ripping you off to collect the exorbitant application fees. While home loans are typically backed by a government entity like Fannie Mae or Freddie Mac, loans for business properties are not. As a result, the lenders charge higher interest rates and are hungry for lots of assurance. Meeting The Loan Repayment Terms In the world of business real estate financing, lenders expect the borrower to repay the entire business advance earlier than the due date. They do this by including a balloon repayment stipulation. But a balloon loan could be a recipe for disaster, especially if the borrower is not ready when the balloon payment comes due usually after 3, 5, or 10 years. If this is the case, the borrower must refinance the advance. If it appears to the lender that the business is not doing well in the years leading up to the balloon payment, the lender may jack up the interest rate or flat out refuse to refinance. The prospect of the realty going into foreclosure is always a concern with balloon loans. How Long Does It Take? The lender needs 10 to 20 additional business days to run detailed financial reports and in-depth credit checks. The loan is then scrutinized by underwriters, and these are seriously picky people. They want to meet you and sometimes your business associates before deciding if they should lend you money. Once the loan application has gained the approval of the underwriter, you just hammer out the terms and sign on the dotted line. Although many lenders boast that they can push a business loan through in 45 days or less, it usually takes closer to three months. The Required Documents Even before you apply for the advance, inquire about the necessary documentation. Some small businesses lack the kind of income documentation required for business lending, so it would be a waste of time to start the process in the face of insurmountable roadblocks. Business property financiers need to see the last 3 to 5 years of tax returns and financial statements, including: Page 2

3 Chapter 3 : Financial Calculator Time Value of Money Not a Toy Small Business Loan Calculator Close Talk to an expert now. Schedule an appointment View *Estimated interest rate for demonstration purposes only. Actual rates. Get Quote Business Loan EMI Calculator Those who are engaged into business be it small or large, at times they feel the need of hands full of cash inflow to feed their production unit. So they choose to borrow the money from banks or NBFCs at a reasonable interest rate. The loan amount that you totally spend on your business and business related activities is your business loan. Why do you need business loans? Business loans are mandatory in any business. These are used for many reasons. The main reason to avail business loan is to enhance the growth of the company. Business loans are not like overdrafts. They are for long terms unlike the overdrafts. Service promotion, investment in land or property that is required for the business, for long term research work and such things that require long term business loans. Mostly the entrepreneurs avail business loans to give financial support to plan the future of the company. Business loans are to be repaid in tentative times set by the banks and NBFCs whichever is your lender. There are three things that are important to consider in business loans, they are loan amount, Tenure and finally the interest rate. This is the amount that is to be paid by the customer every month. EMI is a specific fixed amount of money that needs to be paid to the lender until the tenure of the loan amount is over. EMI is being calculated following a simple EMI calculator that contains the three major variables that is loan amount, interest rate and time period of the loan. Business Loan EMI Calculator is a specific calculator that you need to know how much money you are required to pay to your lender each month. As for example let us assume you have taken loan amount of Rs. So according to this information you will need to pay the total amount of Rs. Now the calculation for the EMI of this will be: The interest amount is being calculated every month afresh as the principal amount gets decreased. The breakage of the total payable amount is given below in the tabular form. As the months pass the portion of principal amount gets decreased so is the interest amount as the interest is calculated on the basis of reduced loan amount on every month. Why do we need to calculate EMI for business loans? It is good to be prepared for the future expenses. If you already know how much you need to pay every month before applying for the loan you will be prepared to take the financial decision more aptly. Part repayment in Business loans As we have mentioned earlier that business loans are needed for the growth of the company. Now there can be any situation where you need money to take some business strategy or opportunity to make profitable business. Then you need business loans to support the strategy you are taking. After availing the loan you will get a fixed tenure to repay the outstanding. Business is a speculation and you can experience anything at anytime. Think of a situation where you make unexpected profits in your business. The first thing that you will do is to repay the loan that you have taken for your business. We will help you here. If you want to repay the loan in parts or completely before completion the tenure period then we will help you here. If you make a part repayment beforehand then the portion of your loan amount will get decreased and hence the monthly interest payment will go down as well. This will help you to lowering down the tenure period of your loan. Page 3

4 Chapter 4 : Business Loan Calculator This calculator is intended for informational purposes only and is not intended to provide today's actual rates. Your actual results may vary. Results provided by this calculator are intended for Illustrative purposes only and the accuracy is not guaranteed. The origination fee may be rolled into the loan. Documentation Fee A common fee associated with loans that is used for the processing of paperwork. Small Business Administration, are designed to meet the financing needs of many different business types. Depending on the type of SBA loan, they can be used for various purposes including business start-up or acquisition, working capital, real estate, franchise financing, debt refinancing, or improvements and renovations. Loan funds are not provided by the government organization, but by banks, local community organizations, or other financial institutions. This reduces lender risk and encourages lending. However, there is additional paperwork that is necessary along with extra fees when applying for SBA loans. On top of that, it may take longer to get approved. Also, beware that they tend to be more strictly regulated, giving business owners less freedom, and maximum loan limits may be insufficient for more costly business needs. The SBA offers four types of small business loans: Microloan These loans are intended for new or growing small businesses. They can be utilized for everything covered under 7 a loans except to pay off existing debt or to purchase real estate. Maximum allowable term is six years. They cannot be utilized for working capital or inventory. Disaster Loan These loans can be used to repair or replace real estate, machinery, equipment, as well as inventory or business assets that are damaged or destroyed as a result of disaster. Possible disasters include earthquakes, storms, flooding, fires natural or manmade, and civil unrest. Conventional Loans Although most conventional loans come from banks, unlike SBA loans, there is no governmental insurance for lenders. Compared with SBA loans, conventional loans may carry low interest rates for borrowers with excellent credit because of their simplicity. On the other hand, borrowers with lower credit or those who are low on funds will likely receive less favorable rates, and may find SBA loans to be more attractive. The approval process for conventional loan is much quicker and is less regulated. Personal Loans It is possible to use the proceeds from personal loans for small business purposes, which can be helpful in many situations. For example new businesses without established histories and reputations can use it to avoid the high business loan interest rates. Refer to the Personal Loan Calculator for more information or to do calculations involving personal loans. Interest-Only An interest-only loan is different from standard loans in that only interest is paid for the duration of the loan. The entire principal balance is only due at loan maturity. An interest-only loan allows less payback during the initial years, and might make sense when high income is expected in the future. Page 4

5 Chapter 5 : Business Loan EMI Calculator: Online Calculator for SMEs - Kotak Mahindra Bank The easiest way to calculate loan interest is with a calculator or spreadsheet, but you can also do it by hand if you prefer. On this page, we'll show you two ways to get the answers you need: For quick answers, use technology. The online calculators and spreadsheet tips below make quick work of. Unlike the first calculation which is amortized with payments spread uniformly over their lifetimes, these loans have a single, large lump sum due at maturity. Although the lump sum includes a single payment of interest for the whole loan, it is not simple interest but accrued by compounding over the life of the loan. As a matter of fact, this is a typical calculation of how finance textbooks teach interest accumulation. Some loans, such as balloon loans, can also have smaller routine payments during their lifetimes, but this calculation only works for loans with a single payment of all principal and interest due at maturity. Compared with smaller routine payments, there is greater risk with not being able to meet the lump sum payment obligation at the end because of how relatively large it is. Technically, bonds are considered a form of loan, but operate differently from more conventional loans. Mainly in that the payment at loan maturity is predetermined, which is the main difference between this calculation and the second calculation, where the maturity payment is not predetermined. The term is used because when bonds were first issued in paper form, the amount was printed on the "face", meaning the front of the bond certificate. Although face value is usually important just to denote the amount received at maturity, it can also help calculate coupon interest payments, which this calculation essentially does. Note that this is mainly for zero-coupon bonds, which do not have coupon payments in between. After a bond is issued, its value will fluctuate accordingly with interest rates, market forces, and many other factors. Loan Basics for Borrowers Interest Rate Nearly all loan structures include interest, which is the profit that banks or lenders make on loans. Interest rate is the percentage of a loan paid by borrowers to lenders. For most loans, interest is paid in addition to principal repayment in order to compound over time. Compound interest is interest that is earned not only on initial principal, but on accumulated interest of previous periods also. Loan interest is usually expressed in APR, or annual percentage rate, in which compounding of interest is not accounted for, but fees are. The rate usually published by banks is the annual percentage yield, or APY, in which compounding interest is accounted for. Borrowers seeking loans can calculate the actual interest paid to lenders based on their given advertised rates by using our Interest Calculator. Compounding Frequency How often interest on loans compound will affect the total amount of interest paid. Generally, the more frequently compounding occurs, the higher the total amount due on the loan. In most cases, loans compound monthly as APR. Use the Compound Interest Calculator to learn more about or do calculations involving compound interest. Loan Term Terms of loans refer to how long they last, given that required minimum payments are made each month. For some specific loans such as mortgages or car loans, the terms can shorten if loan payments are accelerated. Terms can affect loan structures in many ways. Generally, the longer the term of a loan, the more interest will be accrued over time, raising the total cost of the loan for borrowers. However, because of a longer horizon to meet the debt obligation, routinely scheduled payments are lowered. Consumer Loans There are two basic kinds of consumer loans: Secured Loans A secured loan means that the borrower has put up some form of owned asset in exchange for money. As an example, a borrower could go to a bank and offer a valuable coin collection as collateral for a secured loan. It could have been sold for cash instead, but the borrower loses ownership of the asset from then on. By putting it up as collateral, ownership of the asset will be relinquished during the lifetime of the loan. Ownership of the asset is regained at loan maturity with the repayment of loan. However, defaulting on secured loans gives loan issuers legal ability to seize collateral. Common secured loans include mortgages secured by homes and cars secured by auto loans. Unsecured Loans An unsecured loan is simply an agreement to pay a loan back without collateral. Because there is no collateral involved, lenders need ways to verify the financial integrity of their borrowers, usually through inspecting credit histories and debt ratios. Unsecured loans generally have higher interest rates because there is no collateral involved. Unsecured loans include credit cards, personal loans, and student loans. Page 5

6 Chapter 6 : Business Valuation Calculator Calculators by CalcXML Our business loan calculator will help you to calculate your monthly payments and the interest cost for financing your project. Additionally, you will have the option to view and print a complete loan amortization schedule. Paying for funeral expenses sadly becoming more common! Funding a dream holiday Why use this personal loan calculator? Whatever your reasons for wanting to take out a loan, our personal loan calculator is here to assist you by calculating examples of monthly repayments figures that you might have to make. By providing you with a guide to possible loan repayment figures, you can then feel better informed when you weigh up the risk and reward of taking out a personal loan. How to calculate a personal loan To begin your calculation, enter the amount you are hoping to borrow along with the yearly interest rate and the number of months that you are intending to borrow the money for. If you wish, you can alter the start loan date and include any additional deposits you are making at the beginning, along with any extra fees or balloon payments. Your regular monthly payment figure The total interest you will pay Your total loan repayment figure Your estimated payoff date You will also be shown graphs and a monthly repayment schedule of your principal and personal loan interest payments. Personal loan calculator FAQ Here are some common questions that you have been asking about our calculator: What is the effective annual rate? This loan calculator compounds interest on a monthly basis the compound interest calculator has multiple options for compounding. What is a balloon payment? A balloon payment is a large, lump-sum payment made at the end of a long-term loan. It is commonly used in car finance loans as a way of reducing monthly repayment figures. More information about balloon payments is available in our article, What is a balloon payment? APR stands for Annual Percentage Rate and is an important factor in determining the overall cost of a personal loan. You can use APR to compare different loan offers. When you arrange a loan with a finance company, their offer can include extra fees associated with the loan. The APR figure takes that information into account, giving you a simple percentage interest rate to allow you to compare and shop around. The pie chart shown with your personal loan calculator results displays the total interest as a percentage of the total amount paid back. If you have any problems using my loan calculator tool, or any suggestions, please contact me. Page 6

7 Chapter 7 : Business loan calculator and amortization schedule blog.quintoapp.com Own a small business? Chances are you face difficult decisions about how to allocate scare resources every day. Use Bankrate's small business calculators to fine tune your strategy. Business loans are one of the primary ways that individuals obtain finance for various business related expenses. But finding the right lender and loan can be a difficult task. It can end up impacting your bottom line far into the future. But lenders often make it hard to figure out exactly how much a loan costs. Countless business owners use business loan calculators to get rough estimates regarding how much financing will cost them. This guide has been put together to help individuals who are trying to decide on which business loan calculator to use. Remember, you can try a few different calculators if you want to take away the bias that any one calculator may have. We will also provide some reviews of some of the most popular calculators currently available. An Important Purpose So, you may be wondering why loan calculators are important when you can simply ask the lender what the cost of the loan will be. The reason comes down to credit checks. Every time you want to get a quote for a business loan, either your personal credit score or your business credit score will undergo a credit check. Every time your credit is checked, a credit inquiry is recorded on your credit report. It also results in your credit score being lowered. Unlike insurance policies, where you can ask for quotes without repercussions, loans do have an impact on your score. Types of Business Loan Calculators There are two primary types of business loan calculators. Lender Calculators Lender calculators are business loan calculators that are provided by lenders. If you head to some business loan websites, you may find that they have a calculator that can help you quickly estimate how much a business loan will cost. The problem with lender calculators is that they can sometimes be a bit biased. They may favor the lending structure that the lender is trying to use. Or they may show positive results to help lure you into applying for finance. Independent Calculators Independent calculators on the other hand are made by calculator companies and other developers. The great thing about independent calculators is that they are typically much more in-depth than other forms of calculators â developers tend to have no reason not to include every component of a loan. The downside of this type of calculator comes from the variation involved. Below we will explain each feature of the calculator that should be included, as well as why the feature is important to the success of the calculator. Principal Balance The principal balance of the loan is the amount that you have initially borrowed from the lender. This is the amount of money that you will receive once you finalize the loan. This will be the starting balance of your loan prior to making any payments. Interest Rate This is the most important component of any calculator. The interest rate is the percentage of cost that you will accumulate on the loan throughout the duration of your borrowing. Term This is the total amount of time that the loan is paid back over. This will determine how much your monthly payments are. The shorter the term, the higher your payments will be! Frequency of Payments Most loans will be monthly, but some business loans vary. This will have a huge impact on the way that your loan progresses. Origination Fee Many lenders will charge an origination fee when you begin the loan. This is often done as a percentage of the loan, but can also be a flat fee in many cases. Make sure to include this in any calculation. Other Fees and Charges Make sure that you have a way to include other fees or charges. Comparison Tool This is something that is often overlooked when people are trying to find a calculator to use. Some calculators will allow you to compare multiple different loans at the same time. It also makes the entire process of comparing much quicker. Keep in mind you can compare with any calculator by simply resubmitting information, but it will take much longer than if a comparison tool is already available. Graphics Many calculators will also show graphics for your loan balance and other information. This is a great feature that can help you better understand the progression and cost of your loan. Make sure to try and find a calculator that can provide you with some visuals. Business Loan Calculator Reviews Below are some of the most popular calculators on the market. We will overview these calculators so you can get a better idea of which ones are the best to work with. Citizens Bank Calculator Citizens Bank calculator is unique in that it provides the user with information on whether they will qualify or not for financing. It is a lender based calculator. You can input your balance, interest rate, and amortization Page 7

8 amount. There is no spot for extra fees. On the plus side, there are visuals provided to the user! You input interest rate, loan amount, term, and monthly payments. You will then be given data on the loan, as well as an amortization schedule. You can input loan amount, interest rate, compounding schedule, term, payment frequency, origination fee, documentation fee, and other fees. This is one of the most comprehensive calculators available, and it is free from the biases often associated with business loan calculators. This is most definitely a good option for certain borrowers. You input loan amount, term, and interest rate and it calculates your monthly payment. Take this calculator with a grain of salt. Again, this type of calculator should only be used by those who want a basic understanding of their loan. Keep in mind that this is a lender based calculator. With this calculator, you input you loan amount, interest rate, term time, and amortization term. This being said, it does provide a comprehensive amortization schedule which is an added bonus. Shopify Calculator Shopify has a calculator that provides a basic intro into understanding the total cost of your loan. You can input loan amount, interest rate, and term time. The added bonus with this calculator is that you can also input extra monthly payments to see what additional payments would do to your loan balance! As mentioned previously, lenders can be sneaky with fees and charges, so seeing a full cost is often the best way to know the true value of the loan. Verdict After reading this guide, you should have a pretty solid understanding of which business loan calculators to use. A business loan calculator should be part of a broad strategy in finding the best loan for your business. FAQs Calculating different aspects of business loans can be tricky. We put together this handy guide to answer the questions you have about different loan calculations. Use this information to make smart financial decisions that help your business grow. General Business Loan Questions This section will answer all of your general business loan questions. Use this information to form a foundation to understand how business loans work. A small business loan is a loan designed to help your small business get started or grow. There are lots of different kinds of small business loans and people use them for lots of different reasons. What are the Qualifications for a Business Loan? Every lender has different qualifications for a business loan. The best way to qualify for a business loan is to have a sound business plan which shows how the loan will grow your business and enable you to repay the loan. Is it Hard to Get a Business Loan? If you have a solid business plan and demonstrable experience in the industry, then it can be easy to get a business loan. Every bank has their own method for calculating business loans. Additionally, every business loan is different, and needs to be calculated according to the terms of the specific loan. How to Calculate Business Loan Eligibility? Every bank and lender has their own eligibility requirements. SBA loans do require a down payment. How to Calculate Loan Capital in Business? It can come from a long-term loan or a selling stock. You include it in your working capital equation, but not as debt capital, such as short-term loans, which are different. The best bank for your business is the one that offers you the best terms on your business loan. Getting a business loan to start a business can be a challenge. The first step is to develop a detailed business plan. What is the Best Business Loan? For many businesses, SBA loans are the best option. How are Business Loans Calculated? Every lender calculates business loans differently. It will also help you understand how banks and lenders look at qualifications for business loans. Different lenders have different term limits on business loans. Some lenders limit business loans to 5 years, while others may be willing to go as long as 20 years. Chapter 8 : Small Business Loan Calculator TD Bank Simple interest calculator Simple interest is calculated only on the initial amount (principal) that you invested. Example: Suppose you give \$ to a bank which pays you 5% simple interest at the end of every year. Chapter 9 : Simple Interest Calculator Calculator Rates Commercial Property Loan Calculator. This tool figures payments on a commercial property, offering payment amounts for P & I, Interest-Only and Balloon repayments â along with providing a monthly amortization schedule. Page 8