Using a loan calculator without overlooking fees

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A business loan calculator can help you compare repayment scenarios. Its result is only as useful as the assumptions entered, and it is not a lending decision or a personalised quotation.

Use consistent inputs

Compare the same loan amount, term and interest basis. Check whether a rate is annual, monthly, flat or calculated on a reducing balance. Different conventions can produce figures that look comparable but describe very different costs.

Add the missing cash movements

Include arrangement charges, broker fees where applicable, deposits and any final payment. Check whether fees are paid separately or added to the balance. The amount received may be less than the headline amount borrowed.

Test affordability

Place the estimated repayment into a cash-flow forecast and test a weaker trading month. Ask the lender for a written payment schedule and total amount repayable before signing. For interest-only or balloon arrangements, plan the final balance separately; a low monthly figure does not remove it.

Explore your next step

Contact Milestone Funding to discuss your business and funding needs, or explore the funding options.

Further reading: British Business Bank: finance options.

General information, not a personalised recommendation. Availability, costs and terms depend on the provider and circumstances.