Calculator
Business Financing Cost Calculator: Factor Rate to Estimated APR
See the total payback, cost per payment and an estimated APR for factor-rate financing such as merchant cash advances.
Results
Total payback
$65,000
Total cost of financing
$15,000
Payment per business day
$515.87
126 payments
Estimated APR
109.3%
Net proceeds after withheld fees: $50,000. Modeled as 126 equal payments of $515.87, one every business day; a term that isn't a whole number of payment periods is rounded to the nearest whole payment.
Where your payback goes
| Term | Estimated APR, business-daily payments | Estimated APR, weekly payments |
|---|---|---|
| 3 months | 217.1% | 206.8% |
| 6 months | 109.3% | 110.7% |
| 9 months | 73.0% | 73.6% |
| 12 months | 54.8% | 56.3% |
| 18 months | 36.6% | 37.2% |
How to compare offers
- Ask for the total payback amount in writing.
- Confirm the payment frequency — daily, weekly or monthly.
- Get a list of all fees, including any deducted from your funds.
- Ask whether there's a discount if you pay early.
- Request an estimated APR in writing so you can compare offers side by side.
How we calculate
Total payback is the amount funded multiplied by the factor rate. Payment per period is the total payback divided by the number of payments. The estimated APR finds the periodic rate at which your payments equal the funds you actually receive (after upfront fees), then multiplies it by the number of payment periods in a year (252 business days, 52 weeks or 12 months).
Estimated APR here is a nominal annual rate: the rate per payment period multiplied by the number of periods in a year, the convention APR disclosures use. It isn't an effective annual rate, which compounds and comes out higher. It's our estimate for comparison, not the APR a provider must disclose under state rules, which set their own methods. These formulas are covered by automated tests and checked against independent calculations. Results remain estimates rather than provider disclosures.
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