Business Loan Calculator
Estimate what an acquisition loan costs each month. Enter the amount you need to borrow, the annual interest rate, and the term — payments, total interest and the amortization summary update as you type.
| Year | Interest | Principal | Balance |
|---|---|---|---|
| 1 | $43,689 | $32,317 | $467,683 |
| 2 | $40,657 | $35,349 | $432,335 |
| 3 | $37,341 | $38,664 | $393,670 |
| 4 | $33,714 | $42,291 | $351,379 |
| 5 | $29,747 | $46,259 | $305,120 |
| 6 | $25,407 | $50,598 | $254,522 |
| 7 | $20,661 | $55,344 | $199,177 |
| 8 | $15,469 | $60,536 | $138,641 |
| 9 | $9,791 | $66,215 | $72,426 |
| 10 | $3,579 | $72,426 | $0 |
Opens this calculator with your exact numbers already filled in — send it to a client or lender.
Exports the payment summary and the full annual amortization table as a PDF.
Compare Canadian lenders who fund business acquisitions — banks, BDC, credit unions and alternative lenders.
How acquisition loans work
Most Canadian business purchases are financed with a blend: a buyer down payment (commonly 10–30%), a term loan from a bank, credit union or BDC, and often a vendor take-back note where the seller finances part of the price. Lenders size the loan against the business's cash flow — they want the annual payment comfortably covered by SDE or EBITDA, usually with a debt-service coverage ratio of at least 1.25.
The monthly payment here uses the standard amortization formula: P × i ÷ (1 − (1 + i)−n), where P is the loan amount, i the monthly interest rate, and n the number of monthly payments. Real quotes will differ once you add setup fees, insurance, security requirements, or a variable rate.
Before you borrow, confirm the earnings you're buying with the SDE calculator and sanity-check the price with the business valuation calculator. Our guide on how to finance a business purchase in Canada walks through each funding source in detail.
This calculator gives an estimate for planning purposes only and is not financial, tax, or legal advice. Confirm all figures with your lender and accountant.
Frequently asked questions
This calculator uses the standard amortization formula: payment = P × i ÷ (1 − (1 + i)^−n), where P is the loan amount, i is the monthly interest rate (annual rate ÷ 12) and n is the number of monthly payments. For example, $500,000 at 9% over 10 years works out to roughly $6,334 a month.
Bank and credit union term loans for business acquisitions commonly land between about 7% and 12% depending on prime, your credit, the collateral, and how much cash flow covers the payment. BDC and alternative lenders price higher for riskier or asset-light deals; vendor take-back notes are often cheaper and negotiable.
Lenders size the loan against cash flow, not the asking price. Most want a debt-service coverage ratio of at least 1.25 — annual SDE or EBITDA of at least 1.25× the annual loan payment — plus a 20–30% down payment and often personal guarantees or security against assets.
Acquisition loans typically run 5 to 15 years. Longer terms lower the monthly payment and help coverage ratios but increase total interest substantially; the amortization table on this page shows exactly how much. Match the term to the useful life of what you're financing where possible.
No. The estimate covers principal and interest only at a fixed rate. Real quotes add setup and commitment fees, legal costs, possible life or disability insurance on the loan, and can move if you take a variable rate.
Yes. "Download my results" produces a PDF with the payment summary and the full year-by-year interest, principal and balance table you can share with your lender or accountant.