Business Line of Credit Calculator
A line of credit lets you borrow up to a limit and pay interest only on what you draw. Enter a draw to see the interest-only payment, the payment needed to clear it by a chosen date, and the total cost.
Enter your figures below. Results update as you type.
Monthly payment$3,553.95to clear the draw in 12 months
- Interest-only payment
- $400.00
- Total interest
- $2,647.42
- Draw fee
- $600.00
- Total cost of the draw
- $3,247.42
- Credit still available
- $60,000.00
- Share of the line in use
- 40%
How the Business Line of Credit calculation works
Interest-only payment = draw x APR / 12; cost = interest + draw fee
Drawing $40,000 at 12% costs $400 a month in interest alone. Repaying the draw over 12 months takes $3,553.95 a month and costs $2,647 in interest, plus a $600 draw fee at 1.5%.
Frequently asked questions
How is interest calculated on a business line of credit?
Only on the amount you have drawn, for as long as it is outstanding. Multiply the balance by the APR and divide by 12 for a month's interest: $40,000 at 12% is $400.
What is the difference between a line of credit and a term loan?
A term loan pays out once and is repaid on a fixed schedule. A line of credit can be drawn, repaid and drawn again up to its limit, which suits uneven cash needs such as stock purchases or slow-paying customers.
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