Business line of credit calculator.

Method and limitations

Formulas: a draw taken at timing factor f (1 start of month, 0.5 mid-month, 0 end of month) gives an average balance for the month of opening balance + draw × f. Interest = average balance × rate ÷ 12. Draw fee = draw × fee % + flat fee, in any month with a draw. Unused-line fee = (limit − average balance) × unused % ÷ 12. All-in rate = (interest + draw fees + unused fees + annual fee) ÷ the average of the twelve monthly average balances.

Worked example: $100,000 limit at 9%, a 0.5% draw fee, a 0.25% unused fee and a $250 annual fee. Draw $40,000 and $30,000 in months 3 and 4 and $20,000 in month 9, all at the start of the month, and repay it all by month 11 (month-end repayments: $20,000, $30,000, $20,000, $10,000 and $10,000 in months 6, 7, 8, 10 and 11). Interest is $2,775.00, draw fees $450.00, unused fees $172.92 and the annual fee $250.00, so total cost is $3,647.92 on an average balance of $30,833.33. The all-in rate is 11.83%, which is 2.83 points above the stated 9%.

Where the method comes from: the U.S. Consumer Financial Protection Bureau's Regulation Z, 12 CFR 1026.14(c)(2) and (c)(3), computes an effective annual percentage rate for certain open-end credit by dividing the finance charge for the billing cycle, including minimum or fixed charges and transaction charges, by the balance it applies to and multiplying by the number of billing cycles in a year (ecfr.gov, 12 CFR 1026.14, current text checked 2026-09-30). That rule also leaves out loan fees that relate to opening, renewing or continuing an account. This page deliberately includes your annual or renewal fee, so it is stricter than that method. Regulation Z does not apply to credit extended primarily for a business purpose (ecfr.gov, 12 CFR 1026.3(a), checked 2026-09-30), so the result is an all-in cost estimate, not a disclosure APR.

What this is not: the tool supplies no rates or fees. Lenders often charge interest daily, may compound or capitalise it, may set minimum interest or minimum draw sizes, and may name fees differently, so your statement will differ. Interest is assumed paid in cash each month, not added to the balance. Draws are capped at the undrawn limit and repayments at the balance owed. Fixed fees look larger when the average balance is small, which is the point of the all-in rate.

FAQ

What is an unused-line (standby) fee? A charge some lenders apply to the part of the limit you are not using, usually quoted as a yearly percentage of the undrawn amount. Whether yours does is in your credit agreement.

Why is the all-in rate higher than the stated rate? Fees are divided by the balance you actually carried, so a small average balance makes them weigh more.

Does draw timing matter? Yes. The same draw at the end of a month costs no interest that month, while at the start it costs a full month. Try the timing selector.

Is the all-in rate the APR my lender must disclose? No. It includes every fee you enter; disclosure rules differ by country and by whether the credit is for business.