Crowngate Funding Group, a small-business funding service in Grand Island, NE, provides this business acquisition loan payment calculator. Enter the amount financed, an annual rate you were quoted and the term to see the monthly payment, total interest and total repaid. It does not suggest rates; partners set actual terms.
What the calculator computes
- Monthly payment
- Interest summed across the whole term
- Total repaid
It uses only the three numbers you enter: amount, annual rate and term. It does not suggest a rate, a price for the business or an amount anyone would lend.
What to enter when buying a business
- Amount: the purchase price minus your own cash and any seller note
- Rate: a rate a partner actually quoted you, not a guess
- Term: the term in that quote
Run the seller note separately if it has its own rate and term, then add the two monthly payments yourself.
Worked check by hand
With a rate of zero, the payment is simply the amount divided by the number of months. For example, $240,000 over 120 months is $2,000 a month. Any positive rate makes the payment higher. Use that as a sanity check on the calculator's result. The amount is invented for the arithmetic.
What the calculator does not do: it does not test whether the business's cash flow can carry the payment. Do that by hand: take the business's yearly cash flow after the owner's reasonable pay, divide by 12, and compare it with the payment.
Three runs worth doing
- The quote as offered: amount, rate and term from the partner.
- A shorter term: higher payment, less total interest.
- A smaller financed amount: the effect of more buyer cash or a larger seller note.
Write down the monthly payment and total repaid from each run, then compare them with the business's monthly cash flow.
Loan to acquire a business: where to read more
Financing to buy a business in Grand Island, NE walks through the steps, and the term loan page explains how acquisition loans are usually structured. Countywide figures sit on the Grand Island, NE page; the other guides are on the resources page.
By Crowngate Funding Group · Updated