The calculator gives a level payment for a fixed amount, rate and term. A credit line charges interest on the balance actually drawn, so a shrinking balance costs less each month. Factor costs are a different math.
Monthly Factor Rate Calculator Math, Done by Hand for Payroll at a Fall River, MA Quick-Service Restaurant
A factor is a flat multiple, used on merchant cash advances, which are not loans. The calculator on this page takes an annual rate, not a factor, so factor math is done by hand.
Illustration only, invented figures: a quick-service restaurant covers $8,400 of payroll with an advance at a 1.22 factor. The provider collects $10,248.00, so the cost is $1,848.00. If the collections take about five months, that is roughly $369.60 of cost a month (our arithmetic).
For comparison inside the same invented case, a draw of the $8,400 on a credit line at 13.9%, paid down in five level payments, would cost $294.15 in interest, with payments of $1,738.83. That figure is one the calculator here can produce.
Line of Credit Calculator Payment on a Draw for Mold Tooling at a Bristol County, MA Machine Shop
Illustration only, invented figures: a machine shop draws $14,350 on its line to pay for mold tooling and plans to pay the draw down in nine equal payments. In the calculator, that means:
- Amount: 14350
- Rate (annual %): 12.75
- Term (months): 9
For these invented inputs, the estimated monthly payment is $1,680.34. Worked from that rounded payment, nine payments come to $15,123.06 and the interest to $773.06. Entering the term as 0.75 years instead of 9 months makes the payment far too high, so the term always goes in as months.
A line may let a business pay more than a level amount in a good month, which lowers the interest; the calculator shows only the level schedule. On a line that charges interest only on the drawn balance, paying the draw off early stops the interest from that day; the calculator does not model that case, so an early payoff is worked by hand.
Business Line of Credit Calculator, Run on a Plumbing and HVAC Contractor's Recovery Machine and Refrigerant Scales in Bristol County, MA
Illustration only, invented figures: a plumbing and HVAC contractor draws $3,980 for a refrigerant recovery machine and a set of digital scales. Run through the calculator at 13.2%:
| Term | Monthly payment | Interest |
|---|---|---|
| 6 months | $689.10 | $154.60 |
| 12 months | $355.86 | $290.32 |
Going from six to twelve months cuts $333.24 from each payment while interest grows by $135.72. Specialty trade contractors, the NAICS 238 group that includes plumbing and heating work, numbered 1,227 employer establishments in Bristol County, MA in 2023, 865 of them with fewer than five employees (County Business Patterns).
Commercial Line of Credit Calculator Results Next to a Month-by-Month Interest Table for a Fall River, MA Sit-Down Restaurant
Illustration only, invented figures: a sit-down restaurant draws $18,000 at 13.4% for food and beverage orders and pays down $4,500 of principal at the end of each 30-day month, plus that month's interest. Interest here is the balance times the annual rate times 30 days over a 365-day year.
| Month | Balance during the month | Interest |
|---|---|---|
| Month 1 | $18,000 | $198.25 |
| Month 2 | $13,500 | $148.68 |
| Month 3 | $9,000 | $99.12 |
| Month 4 | $4,500 | $49.56 |
The four months of interest total $495.61. The calculator, given $18,000, 13.4 and 4 months, shows a level payment of $4,626.32 instead; worked from that payment, interest comes to $505.28. The two methods differ because one pays down a fixed principal amount and the other a fixed total.
A sit-down restaurant drawing on a line for food orders is one of 1,109 restaurants and other eating places with paid staff that County Business Patterns counted in Bristol County, MA for 2023 (NAICS 7225). How draws, the draw period and a limit increase work is set out on the line of credit page. When an estimate turns into a real cost, the request form is on the request page.
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