Use this Tool to Calculate the Cost of Your Small Business Loan

Raising capital is an entrepreneur’s most important job. Financing decisions are investment decisions, and they are critical to the success of your venture. Making one wrong move can make the business collapse fast and furious. Borrowing from banks and other lenders is often the way most small businesses access business capital. As a savvy small business owner, you must understand how interest works. The consequences that follow a bad borrowing decision can be  disastrous.
Effects of a bad borrowing  decision

Making one wrong borrowing decision can lead to many and varied adverse results. The cost of borrowed capital must not be too high. If you get a rate that’s too high, your business may come down crumbling at some point. That can leave you feeling devastated. Your employees may lose jobs. They might also end up losing their homes if they had a mortgage. Your credit score often deteriorates. In the end, you have lower chances of getting approved for loans in the future.

Get accurate information

As an entrepreneur, you have likely gone with your gut when making some crucial business decisions. When it comes to small business loans, though, you need to get accurate information. You must understand all the aspects of the specific loan type you intend to borrow. The applicable interest rate is often the most significant aspect. That’s why you must pay attention when comparison-shopping.

Know whether it’s a fixed rate or a variable rate. Inquire about closing costs, funding fee, and documentation fee. Using the right business loan calculator before making your decision can help you sidestep a lot of pitfalls. Have you tried a business loan calculator? You should. It’s accurate and easy-to-use. The tool allows you to see all the components that add up to your monthly investment.

Here is how to use this business loan calculator

Decide the amount of business capital you need. The specific amount you require depends on what you intend to achieve with the funds. Maybe you want growth capital. Perhaps you want to purchase additional equipment. Maybe you have decided to include a new product or service after careful research. Once you have settled on a figure, head to this loan calculator. Enter the amount you need and the payment term. Finally, press the “calculate” button, and that’s it. It takes seconds.

Let’s borrow $10,000 payable over 24 months

Assume you need $10,000 to repay over 24 months. Upon pressing the “calculate” button, you get super detailed results that are straightforward and easy-to-understand. The information you get includes the monthly interest rate applicable, closing fee, documentation fee, funding fee, total interest paid, monthly payment, and most importantly, the cost of the loan.

Easily scan the loan details

The tool displays the results in a columnar form. That allows you to analyze all the critical components of the loan. In our example, you would pay a monthly installment of $470.73. The closing fee would be $699 while the total interest paid would be $1,297.63. The total cost of capital would be $1,996.63. Now, that’s transparency and accuracy delivered as quickly as you would want. It gets even better. Did you notice the company that offers this free loan calculator doesn’t charge documentation fee and funding fee?

Get matched with the right  loan

Different lenders offer different loan terms. The right lender matches you with a loan solution that suits your need best. Do you seek a lender that accepts online applications? Do you want a company that’s transparent, fast, and understanding? You may want to try Camino Financial. This lender offers loans that have helped thousands of small business owners get the most out of their borrowing decisions.

A loan calculator that provides  transparency

Getting the wrong loan at an unfavorable interest rate can lead to financially devastating consequences. Consult the right lending institution and use this business loan calculator to get transparency before you start the process. Not only you will choose the right small business loan, buat also you‘ll avoid trouble down the road.

Monica Lynn Williams

Monica Lynn Williams is a writer for Camino Financial, an online lender for small business loans. She is an experienced professional in the world of business, finance, literature, Cryptocurrencies and IT. Having been in the writing industry for the last 12-years, she has spent most of her career writing articles, blog posts, products reviews, tech texts, and buyers guides.

All opinions expressed on USDR are those of the author and not necessarily those of US Daily Review.
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