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Business Line of Credit Calculator
Use our free business line of credit calculator to estimate monthly interest, repayment amounts, and total interest for a planned draw. Compare an interest-only scenario with a monthly payoff plan, then adjust the draw amount, annual interest rate, and planning period to explore different costs.
Estimated monthly interest
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Inputs changed. Select Calculate Costs to update these results.
View payment schedule
Illustrative monthly payments. The interest-only scenario includes repayment of the full draw in the final month.
| Month | Payment | Principal | Interest | Balance |
|---|
Interest only
In this scenario, monthly interest payments do not reduce your draw balance. The full principal is paid in the final month.
Monthly payoff
This scenario uses equal monthly principal and interest payments to pay the draw off over your chosen period.
Credit limit vs. draw
Interest is estimated on your drawn balance. Unused credit here means the entered limit minus your initial draw.
Planning estimates only, not loan offers or lender minimum-payment calculations. Both scenarios assume one initial draw from a zero balance, a constant annual interest rate divided by 12, and payments at the end of equal monthly periods. No additional draws, fees, or rate changes are modeled. Actual credit lines may use daily interest calculations, variable rates, different payment rules, and lender restrictions on available credit. Draw fees, annual fees, and unused-line fees are excluded. Displayed amounts are rounded to cents; totals use unrounded calculations. Your inputs stay in this calculator and are not sent to our financing partner.
How to Use the Business Line of Credit Calculator
- Enter your credit limit. This is the total credit available in the scenario you want to explore.
- Enter your initial draw amount. Add the amount you plan to borrow, up to your credit limit.
- Add an annual interest rate. Use a quoted rate or test different rates for planning purposes.
- Choose your planning period. Enter the number of months you want to model.
- Select a repayment scenario. Compare interest-only payments with paying off the draw through equal monthly payments.
Review the results, then adjust your inputs to explore another scenario.
Understand Your Estimated Payments
Interest-Only Scenario
This scenario estimates monthly interest payments while keeping the amount borrowed unchanged. The calculator assumes you repay the entire borrowed amount, plus the final month’s interest, at the end of your selected planning period.
The monthly interest amount is not your final payment. You still need to repay the principal.
Monthly Payoff Scenario
This scenario spreads repayment of the initial draw across your selected number of months. Each payment includes principal and interest, gradually reducing the outstanding balance.
It is a planning estimate, not a calculation of your lender’s required minimum payment.
Business Line of Credit Payment Example
Suppose you enter a $100,000 credit limit, draw $50,000, and use a 12% annual interest rate over 12 months.
| Estimated result | Interest-only scenario | Monthly payoff scenario |
| Regular monthly payment | $500.00 in interest | $4,442.44 in principal and interest |
| Final month’s payment | $50,500.00 | Approximately $4,442.44 |
| Total interest | $6,000.00 | $3,309.27 |
| Total paid, including principal | $56,000.00 | $53,309.27 |
See How Borrowing Decisions Affect Your Budget
Before choosing a financing option, explore multiple scenarios. This calculator helps you:
- Compare the costs of drawing different amounts.
- Estimate the effect of a higher or lower interest rate.
- See how a shorter payoff period changes monthly payments.
- Plan for the principal repayment in an interest-only scenario.
- Review estimated total interest alongside the monthly payment.
What the Calculator Includes—and Its Limits
The calculator models one initial draw from an otherwise unused credit line. It assumes a constant annual interest rate, equal monthly periods, and no additional borrowing.
It does not include annual fees, draw fees, origination fees, or other lender charges. It also does not model changing rates, daily balance calculations, or lender-specific minimum payments.
The unused credit figure is your entered credit limit minus the initial draw. It is not confirmation that a lender will make that amount available.
Frequently asked questions
A business line of credit provides access to funds up to an approved limit. You can draw funds as needed, subject to your agreement. With a revolving line, repaying principal generally makes that credit available to borrow again, provided the account remains eligible for additional draws. Learn more about how business credit lines work.
Your credit limit is the maximum amount available under the credit agreement. Your draw amount is the portion you borrow.
For example, drawing $20,000 from a $75,000 line leaves $55,000 unused before considering any lender restrictions or other outstanding balances.
For the interest-only scenario, it multiplies the amount drawn by the annual interest rate and divides by 12.
For example, a $20,000 draw at a 12% annual rate produces an estimated monthly interest payment of $200. Actual lender calculations may differ.
No. Paying only interest leaves the principal unchanged. In this calculator’s interest-only scenario, the full principal is repaid in the final month, along with that month’s interest.
No. It shows two illustrative repayment scenarios. Your lender’s required payment may use a different formula or payment schedule. Check your agreement for the actual requirements.
This version models one initial draw with no additional borrowing. You can change the draw amount to compare separate scenarios, but it does not simulate a series of withdrawals and repayments.
No. The estimates exclude lender fees. Review any offer for charges that could increase your total cost, including account maintenance, annual, origination, or draw fees.
Yes. Change the annual interest rate and calculate again to compare results. Each calculation assumes that rate stays constant throughout the planning period.
The calculator is free to use and does not perform a credit check. Exploring numbers here is separate from applying for financing.
No. The calculator does not assess eligibility, approve applications, or offer loans. The financing provider determines any approved amount, interest rate, and repayment terms.
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Now that you have an estimate, take the next step toward understanding your financing options. Compare any available offer with your expected cash flow, repayment plan, and total borrowing cost.
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