Business Loan Interest Calculator with Extra Payments

Periodic-rate amortization formulas are used. Periodic interest rate is calculated as annual_rate / 100 / payments_per_year. The standard fixed-payment formula computes the scheduled payment that amortizes the loan over its term.

For recurring extras, the effective payment (scheduled payment plus recurring extra) is used in the closed-form repayment formula derived from the geometric progression of remaining balances. For a single lump-sum prepayment, the remaining balance before the prepayment is computed, the lump-sum reduces principal, and remaining payments are recomputed assuming the effective payment thereafter.

Edge cases are handled conservatively: if an extra payment fully repays the loan before the next scheduled payment, the model clamps the remaining balance to zero and counts only the payments required to reach zero. Where formulas would divide by zero or produce non-finite results, the calculator falls back to the original schedule.

This tool gives quick, transparent estimates of how extra payments affect interest and payoff timing. It is intended for planning and comparison.

Always verify payoff amounts with your lender because this calculator assumes no fees, no changes to APR, and interest computed on the nominal schedule provided.

Example 1: $50,000 loan, 6.5% APR, 5 years, monthly payments. Adding $200 monthly recurring extra reduces both total interest and number of payments — results shown in the outputs.

Example 2: Same loan with a $5,000 lump-sum after 12 payments. The calculator shows the remaining balance at payment 12, applies the lump-sum, and estimates remaining payments and interest thereafter.