SBA Loan Calculator
Introduction
Our SBA Loan Calculator is designed to help business owners accurately determine the maximum value of their business based on the available cash flow. This tool is essential for sellers who want to set realistic expectations for the potential sale price of their business, particularly when the likely buyer is an owner-operator needing an SBA loan.
How The SBA Loan Calculator Works
The calculator evaluates the following key factors:
- Monthly Cash Flow: The available cash flow that can be used to finance a loan.
- Current Prime Interest Rate: The prevailing prime interest rate.
- Loan Term: The duration of the loan in years.
- Equity Injection: The minimal equity injection required by SBA lenders, typically 10%.
- Debt Service Coverage Ratio (DSCR): The ratio required by most SBA lenders to ensure the loan can be serviced with the available cash flow, typically 1.25.
Why Use Our SBA Loan Calculator?
- Realistic Valuation: Provides an accurate estimate of what buyers can afford, aligning seller expectations with market realities.
- Financial Insights: Offers detailed insights into the financial requirements for securing an SBA loan.
- Strategic Planning: Helps sellers plan strategically by understanding the financial capacity of potential buyers.
Conclusion
Our SBA Loan Calculator is an invaluable tool for business owners looking to sell their business. By factoring in monthly cash flow, prime interest rate, loan term, equity injection, and DSCR, it delivers a clear and realistic valuation, ensuring sellers are well-prepared to engage with potential buyers.
Use the calculator today to gain a realistic understanding of your business’s value and set yourself up for a successful sale.
Fixed Values - Equity Injection Percentage=10% and Debt Service Coverage Ratio=1.25
Results:
Annual Cash Flow for Debt Service: $
Monthly Payment: $
Maximum Loan Amount:
Equity Injection Amount: +
Maximum Purchase Price:
Amortization Schedule:
| Month | Interest | Principal | Remaining Balance |
|---|
