TOOLS

Business Loan Refinance ^Calculator

Refinancing a business loan can be complex, but this Business Loan Refinance Calculator provides quick, objective figures to assess new offers. It helps business managers compare costs and terms easily, turning headline rates into clear pound-value impacts. Before starting an application, consider consulting with a platform like business loan refinancing options or reviewing business loan products for a broader view.

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How To Use The Business Loan Refinance Calculator

Gather loan details

Collect your current loan balance, interest rate, remaining term, monthly repayment, and any early settlement fees. Have the proposed new loan amount, rate, term, and arrangement fee ready. For more on loan terms, see term loans.

Enter new offer terms

Input your old and new loan information into the calculator, ensuring rates are annual percentages and terms match months or years as labelled. For clarity on fees and costs, consult the finance dictionary.

Review savings output

After calculating, review the new monthly repayment, total interest, and net savings including fees. Download or email the summary for discussion with lenders or advisers. Learn more about debt financing options here.

^Benefits of Using the Business Loan Refinance Calculator

A Business Loan Refinance Calculator helps businesses assess their options for refinancing existing loans, enabling them to lower their interest rates, manage payments better, and improve overall cash flow. By providing a clear overview of potential savings and alternative loan terms, it facilitates informed financial decisions that can strengthen a business's financial health.

This calculator translates complex loan rates and fees into concrete financial impacts, helping managers judge if refinancing offers cost savings, quicker repayment, or improved cash flow. It saves time by providing clear estimates and supports negotiation with lenders. Explore related tools like the business loan calculator for complementary insights.

Clarity on costs

Time saving estimates

Negotiation leverage gained

Apply for refinance funding now

Generate offers

How Business Loan Refinancing is Calculated

Monthly repayment formula

Fixed monthly payment using amortisation formula.

Monthly repayment formula

The calculator uses M = P × r ÷ (1 − (1 + r)^−n), where P is the new principal, r is the monthly interest rate (annual rate divided by 12), and n is the total number of monthly payments. Result M is the consistent monthly repayment clearing the loan by term end. More on amortisation is available.

Outstanding balance formula

Estimates the current amount still owed on the loan.

Outstanding balance formula

The outstanding balance B = P × (1 + r)^t − M × ((1 + r)^t − 1) ÷ r, where P is the original loan, r the monthly interest rate, M the original monthly payment, and t the number of payments made. This indicates what must be repaid to clear the old loan now.

Total interest savings

Compares lifetime interest of old and new loans including fees.

Total interest savings

Savings calculation: (M_current × n_remaining − B) − (M_new × n_new) − Fees, where M_current is the old payment, n_remaining is months left, B the outstanding balance, and M_new and n_new the new loan's payment and term. Fees include settlement and arrangement costs. A positive saving suggests economic benefit from refinancing.

Understanding Your Business Loan Refinance Calculator Results

Compare total cost

Check the total amount payable on both the old and new loans. A lower overall cost after including fees indicates potential savings from refinancing. For loan cost explanations, visit the interest rate definitions.

Test rate sensitivity

Experiment with different proposed interest rates and terms to see how they affect monthly cash flow and overall cost. Typical small business loan rates range between 4 % and 15 % annually.

Account for fees

Include early repayment charges, valuation fees, and new loan arrangement fees when calculating savings. Ignoring these fees can overstate benefits and lead to poor decisions. For fee details, consult the finance dictionary.