Business Line of Credit Calculator
With a line of credit you pay interest only on what you draw. Enter your credit limit and a draw to see the payment, the interest and fees, and the credit you still have available.
An estimate for planning only, not an offer of credit. Your actual rate, terms and payment depend on your business and the lender. Nothing you enter is saved or sent.
See your real numbersYear-by-year breakdown
| Year | Balance paid | Interest paid | Balance left |
|---|
Example
Drawing $40,000 from a $100,000 line at 14% and repaying it over 12 months costs about $3,591 a month and $3,098 in interest. The other $60,000 stays available, and costs nothing until you use it. As you repay, the credit becomes available again.
How a business line of credit is charged
A line of credit gives you a limit you can draw from when you need it. You pay interest only on the amount you have drawn, not on the full limit. Some lines ask for equal payments that clear each draw over a set period, others let you pay interest only for a time. When you repay, that credit is available to use again.
Watch the fees, not just the rate
Some lines charge a fee each time you draw, a monthly or yearly maintenance fee, or both. On a small draw repaid quickly, fees can cost more than the interest. Enter them in the calculator to see the full cost of a draw.
Line of credit or term loan?
A line suits costs that come and go: stock before a busy season, payroll while waiting for customers to pay, an unexpected repair. A term loan usually suits one large purchase you will pay off over years. See how our business line of credit works.
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Frequently asked questions
How is interest on a business line of credit calculated?
Interest is charged only on the amount you have drawn, usually at the APR divided by 12 each month. If you draw $40,000 at 14%, the interest for a month is about $467.
Do I pay anything if I do not use my line of credit?
You pay no interest on credit you have not drawn. Some lenders charge a monthly or yearly maintenance fee whether you draw or not, so check your agreement.
What is a draw fee?
A fee charged each time you take money from the line, usually a percentage of the draw. It adds to the cost of every draw, which matters most on small or short draws.
Can I use the line again after I repay it?
With a revolving line of credit, yes. As you repay what you drew, that amount becomes available to draw again.
This calculator gives estimates for planning only. It is not an offer of credit, and the results are not financial advice.
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