This page documents every calculation on the site, so you can check our work or reproduce it. All calculations run in your browser; nothing is sent to a server.
The APR method
Wherever we show an estimated APR, we use the actuarial method described in Regulation Z, Appendix J (12 CFR 1026). We find the periodic rate i that satisfies
money received = Σ paymentk ÷ (1 + i)tk
where tk is the time of payment k in unit periods, and multiply i by the number of unit periods in a year: 12 for monthly schedules, 52 for weekly, and 365 for daily schedules, where the unit period is one calendar day. Money received is the amount funded minus any fees deducted or paid upfront, which is why fees raise the APR.
The equation has no closed-form solution. We solve it by bisection to a precision well under $0.01 of present value. Commercial financing isn't covered by the Truth in Lending Act, so our APR is a comparison tool, not a legal disclosure.
Merchant cash advances
- Total payback = advance × factor rate. Money received = advance − upfront fees.
- Fixed schedules: payback ÷ number of payments, paid every weekday (Monday to Friday) or every 7 days after funding. US federal holidays are ignored.
- Holdback schedules: daily payment = monthly card sales × 12 ÷ 260 × holdback %. The number of payments is the payback ÷ daily payment, rounded up; the last payment is the remainder.
- Rule-of-thumb rate (shown for comparison) = (cost ÷ money received) × 365 ÷ days to repay.
Business loans
- Amortizing: payment = P × r ÷ (1 − (1 + r)−n), with r = annual rate ÷ payments per year.
- Flat interest: interest = P × rate × (n ÷ payments per year); payment = (P + interest) ÷ n.
- Total payback: payment = payback ÷ n.
- Fees added to the loan increase P; fees deducted upfront reduce money received. Total cost = total repaid − money received.
SBA 7(a) loans
- Guaranteed portion = 85% (loans ≤ $150,000) or 75% (larger), 50% for SBA Express, capped at $3,750,000.
- Upfront fee from the schedule for the SBA fiscal year of the application date, applied to the guaranteed portion, including the short-term (≤ 12 months) rate and any fee waiver for that year.
- Payment: standard monthly amortization at base rate + spread. APR counts the guaranty and packaging fees as costs whether deducted, paid in cash or financed.
- Maximum-rate check for Prime-based variable loans: Prime + 6.5% (≤ $50,000), + 6% (≤ $250,000), + 4.5% (≤ $350,000), + 3% (larger).
Equipment lease vs. buy
- All cash flows are discounted monthly at j = discount rate × (1 − tax rate) ÷ 12. Costs are positive.
- Buy: down payment + loan payments (+ any balance outstanding at the end of the lease term) − tax rate × (interest + depreciation) at each tax year-end − after-tax residual value.
- After-tax residual = residual − tax rate × (residual − remaining tax basis).
- FMV lease: lease payments − tax rate × payments deducted each tax year.
- $1-buyout lease: the implicit rate is solved from the payments and the $1 buyout, then the lease is treated as a financed purchase at that rate.
- Depreciation: Section 179 and 100% bonus deduct the full cost in year one; MACRS 5- and 7-year use the IRS Publication 946 half-year tables.
Rounding
Calculations keep full precision. Results are rounded only for display: currency to the cent (half away from zero) and rates to two decimal places.
Test cases
Every engine is tested against fixed cases computed independently. A selection:
| Inputs | Expected result |
|---|---|
| MCA: $50,000 × 1.35, 126 weekday payments | $535.71 per payment, 176 days, APR 131.49% |
| MCA: same, $1,500 fee deducted | APR 145.73% |
| MCA: 10% holdback on $60,000/month sales | $276.92/day, 244 payments, APR 67.87% |
| Loan: $100,000, 7.5%, 60 months, $2,000 fee | $2,003.79/month, APR 8.36% |
| Loan: $50,000, 12% flat, 52 weekly | $1,076.92/week, APR 22.71% |
| SBA: $1,500,000 (FY2026 schedule) | Guaranty $1,125,000, fee $39,687.50 |
| SBA: $500,000, 10.5%, 120 months, fee from proceeds | $6,746.75/month, APR 11.05% |
| Lease vs. buy: $100,000, 25% tax, Section 179, $25,000 residual | Buy $63,394.94, lease $73,676.28 |
| $1-buyout lease: $100,000, $2,100 × 60 in advance | Implicit rate 9.85% |
Data sources and update schedule
| Data | As of | Source | Checked | Updated |
|---|---|---|---|---|
| SBA 7(a) fee schedules (FY2026, FY2027) | 2026-09-26 | SBA 7(a) fee information notices by fiscal year (see each fiscalYears[].source) | Secondary source; pending primary check | Each October 1 (SBA fiscal year) |
| Prime rate | 2026-09-21 | Board of Governors of the Federal Reserve System, H.15 Bank Prime Loan Rate (FRED series DPRIME) | Verified against primary source | After each FOMC rate decision |
| Section 179 limits and MACRS tables | 2026-09-26 | IRS Rev. Proc. 2025-32 §4.24 (2026 §179 limits); OBBBA (P.L. 119-21) §70301/§70401; MACRS rates from IRS Publication 946, Table A-1 | Verified against primary source | Each autumn (IRS inflation revenue procedure) |
Each data file carries an expiry date. Our build checks fail if any file expires without an update, so stale fees or rates can't ship silently.
Corrections
If you find an error, please contact us with the page, your inputs and what you expected. We fix confirmed errors promptly and note material corrections in the changelog below.
Changelog
- 2026-09-26: Launch versions of all four calculators. Added the SBA fiscal 2027 fee schedule (pending primary-source check) and verified the 2026 Section 179 limits against IRS Rev. Proc. 2025-32.