SMB Tools / SBA & financing
Can the business carry the loan?
Model an SBA 7(a) or conventional acquisition loan: the monthly payment, what it costs over the life of the loan, and the debt-coverage test a lender runs before they say yes.
The loan
Amount financed
$
Interest rate (annual)
%
Term
years
Can the cash flow carry it?
Optional, but it’s the test a lender runs.
Annual cash flow after what you pay yourself
$
DSCR2.07x
Above the 1.25 to 1.5x range many lenders look for. This cash flow supports about $580,000 of loan at these terms before coverage drops below 1.25x.
Monthly payment
$4,821.25
$350,000 at 11.00% over 10 years
- Total interest
- $228,550
- Total repaid
- $578,550
- Annual debt service
- $57,855
Balance over time
The loan, year by year
Years
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Still owedend of year
$329,639
$306,921
$281,575
$253,296
$221,744
$186,541
$147,264
$103,443
$54,550
$0
A self-assessment estimate, not a loan offer and not advice on whether or how much to borrow; that is your decision with the lender and your adviser. Your lender sets the actual rate, fees, and structure. Assumes a fixed rate and equal monthly payments.