Business Loan Affordability Calculator
Find out how much business financing you can afford based on your revenue and cash flow.
Total monthly revenue
Operating expenses
Monthly debt payments
Minimum 1.25 required
Anticipated loan rate
Desired loan duration
Max Monthly Payment
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Max Loan Amount
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Current DSCR
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Projected DSCR
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Find the Right Business Loan
- Compare 75+ lenders
- Rates as low as 5.49%
- Funding in 24-48 hours
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How to Use This Calculator
Step-by-Step Guide
- Enter Annual Revenue: Your business's total annual revenue.
- Enter Net Operating Income: Revenue minus operating expenses.
- Enter Existing Debt Payments: Current monthly debt obligations.
- Enter Expected Interest Rate: Anticipated loan rate.
- Review Results: See maximum affordable loan amount.
Key Metrics Lenders Consider
- DSCR: Debt Service Coverage Ratio - NOI divided by debt payments (1.25+ required).
- Debt-to-Income: Total debt payments vs. income.
- Revenue History: Consistent revenue over 2+ years.
- Collateral: Assets to secure the loan.
Why This Matters
Understanding your borrowing capacity helps you:
- Set realistic financing expectations
- Improve metrics before applying
- Choose appropriate loan amounts
- Negotiate better terms
Frequently Asked Questions
Most lenders require a minimum DSCR of 1.25 (sometimes 1.15 for strong applicants). This means your net operating income must be 25% higher than your debt payments. SBA loans typically require 1.15-1.25, while traditional bank loans often want 1.25-1.35. Higher DSCRs get better rates and terms.
Use this calculator to find your maximum affordable loan based on your DSCR target. Generally, your total monthly debt payments (including the new loan) shouldn't exceed 75-80% of your net operating income. Factor in seasonal fluctuations and maintain a cash buffer for unexpected expenses.
DSCR (Debt Service Coverage Ratio) = Net Operating Income Ć· Total Debt Service. It measures your ability to cover debt payments with business income. A DSCR of 1.0 means you break even; below 1.0 means you can't cover payments. Lenders use DSCR to assess loan risk and determine approval.
Improve DSCR by: 1) Increasing revenue through sales growth, 2) Reducing operating expenses, 3) Paying down existing debt, 4) Refinancing current loans to lower payments, 5) Improving profit margins. Even small improvements can significantly increase your borrowing capacity.
Lenders primarily look at cash flow and profit (net operating income), not just revenue. A business with $1M revenue but $950K expenses has less borrowing capacity than one with $500K revenue and $200K profit. Lenders want to see consistent, sustainable profitability to ensure you can repay the loan.
Find the Right Business Loan
- Compare 75+ lenders
- Rates as low as 5.49%
- Funding in 24-48 hours
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