Business Loan Refinance Calculator with Extra Payments
This calculator helps you compare an existing business loan to a proposed refinance and shows how adding extra payments (regular or one-time) affects payoff time and interest paid. Use conservative inputs for fees and realistic extra-payment schedules.
Results are estimates for planning and negotiation. They do not replace lender disclosures; verify exact numbers from loan agreements and amortization schedules.
Calculate payments, total interest, net savings after refinance costs, and an approximate break-even point measured in payment periods.
Inputs
Results
Current loan periodic payment
$1,956.61
Refinance periodic payment
$1,887.12
Total interest remaining (current loan)
$17,396.89
Total interest (new loan)
$13,227.40
Estimated net interest savings after refinance costs
$2,169.49
Approximate break-even (periods)
28.7805
| Output | Value | Unit |
|---|---|---|
| Current loan periodic payment | $1,956.61 | currency |
| Refinance periodic payment | $1,887.12 | currency |
| Total interest remaining (current loan) | $17,396.89 | currency |
| Total interest (new loan) | $13,227.40 | currency |
| Estimated net interest savings after refinance costs | $2,169.49 | currency |
| Approximate break-even (periods) | 28.7805 | periods |
Visualization
Methodology
Periodic payment is calculated using the standard amortizing loan formula: payment = r * PV / (1 - (1 + r)^-n), where r is the periodic interest rate and n is the number of periods.
For extra fixed periodic payments, payoff periods are estimated by solving the amortization equation for n using logarithms. One-time lump-sum payments are modeled as a principal reduction at the specified period and then the remaining amortization is recalculated.
Estimates exclude taxes, insurance, business operating covenants, or non-interest lender charges unless entered as refinance costs. When the periodic rate is zero, division-by-zero is avoided by linear amortization.
Worked examples
If your current loan has $100,000 remaining at 6.5% with 5 years left and a refinance offers 5.0% for 5 years with $2,000 fees, this tool calculates the change in periodic payment, total interest, and net savings after fees.
Adding a fixed extra payment of $100 per month to the current loan shows how many months you save and how much interest you avoid paying overall.
Further resources
Expert Q&A
Are these results exact?
No. Results are mathematical estimates using standard amortization formulas. Actual lender schedules, timing of payments, rounding rules, day-count conventions, and any prepayment penalties can change outcomes. Use this calculator for planning and validate with lender statements.
Do you include refinance fees in savings?
Yes. Refinance costs entered are subtracted from interest savings to produce an estimated net savings figure.
How do extra payments affect my loan?
Regular extra payments reduce the principal faster, decreasing the number of periods needed to pay off the loan and reducing total interest. A one-time lump sum reduces principal immediately; the tool models its impact when you specify the payment period.
What if interest rate is zero?
For a 0% periodic rate the calculator treats amortization as linear: principal divided evenly over remaining periods to avoid divide-by-zero errors.
How should I interpret break-even periods?
Break-even is an approximate count of payment periods until cumulative payment savings equal refinance costs. If new periodic payment is higher than current payment, break-even is not meaningful.
Sources & citations
- NIST — Frameworks and best practices for secure and auditable financial calculators — https://www.nist.gov
- ISO — Quality management and software lifecycle standards — https://www.iso.org
- IEEE — Standards for software verification and validation — https://www.ieee.org
- OSHA — Guidance for operational safety and recordkeeping in business operations — https://www.osha.gov