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Equipment loan calculator
Enter the equipment price, your down payment and the loan terms. Sales tax and fees rolled into the loan are counted, and a balloon payment lowers the monthly payment but leaves a lump sum due at the end.
How the payment is calculated
This is the standard fixed-rate loan formula: payment = (P - B x v) x r / (1 - v), where P is the amount financed, B is any balloon payment, r is the APR divided by 12, and v is (1 + r) raised to the power of minus the number of months. With no balloon it reduces to P x r / (1 - (1 + r)^-n). At 0% APR the payment is simply (P - B) / n. Your lender's number can differ slightly if they count days differently or add fees.
Worked example
A $100,000 machine with $10,000 down at 8% APR over 60 months finances $90,000. The payment is $1,824.88 a month, and you pay $19,493 in interest over the term. Try these numbers in the calculator above.
Shorter term or lower payment?
The comparison table shows the trade-off. A longer term lowers the monthly payment but raises the total interest. If you are comparing a loan with a lease, use the loan vs lease calculator. To see how a purchase could be deducted, try the Section 179 calculator.
The interest portion of your payments is generally part of what you can deduct as a business expense, but whether and when depends on your situation. Ask a tax professional.
Common questions
What is a balloon payment?
A balloon payment is a lump sum due at the end of the loan. It lowers the monthly payment, but you must pay it, refinance it or sell the equipment to cover it.
Should I roll fees and sales tax into the loan?
Anything you roll in is financed, so you pay interest on it. Enter sales tax and fees in the boxes to see the real cost of financing them.
Does this include taxes or insurance?
Only the sales tax you enter. Insurance, delivery, installation and other costs are not included unless you add them to the price.