How we build these estimates

Independence policy

Cost of Financing is funded entirely by display advertising. We do not accept lender sponsorships, we do not sell or share leads, we take no referral or broker fees, and we do not run affiliate links to financing products. We do not offer, broker or arrange loans, and we never collect application information. There is no form on this site that sends your details to a lender, because there is no lender relationship to send them to.

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Data sources

• Published SBA programme terms, rate caps and guarantee fee schedules for the current fiscal year.
• The prevailing prime rate, currently 6.75 percent in 2026, which underpins SBA maximum rates.
• Publicly posted lender rate cards, fee schedules and sample agreements.
• Regulatory and supervisory publications on small business credit conditions.
• Anonymised term sheets and quotes shared with us by readers and practitioners.

Where sources disagree we widen the range rather than choosing a favourite. We would rather be usefully approximate than precisely wrong.

Range widths and why they are wide

• Invoice factoring. Central estimate from your inputs, with a range of about 15 percent below to 20 percent above to cover reserve timing, aging surcharges and fees disclosed only in the master agreement.
• Merchant cash advance. Central APR solved from the payment schedule, with a range of about 10 percent below to 15 percent above to reflect variable remittance and revenue seasonality.
• SBA 7(a). Upper bound priced at the published cap. Lower bound applies your expected discount, floored at a realistic spread over prime because lenders rarely price near the base.

Core assumptions

• Daily merchant cash advance remittances run on 252 business days per year, weekly on 52.
• Effective APR is a simple annualisation of the solved periodic rate, without intra year compounding.
• SBA guarantee fees are calculated on an assumed 75 percent guaranteed portion.
• Factoring fees are charged on invoice face value and measured against cash advanced.
• All figures are pre tax and exclude any tax deductibility of interest and fees.
• All amounts are in United States dollars.

Review cadence

Rate caps and fee tiers are reviewed whenever SBA publishes a change and at minimum each quarter. Market pricing ranges in the guides are reviewed twice a year. Each guide shows its last reviewed date at the top. If you believe a figure is out of date or wrong, tell us on the contact page and include the source. We correct errors and note material corrections on the page.

Limitations

These calculators produce educational estimates, not quotes and not financial advice. They cannot see your credit profile, your customer concentration, your collateral or the specific terms a lender will offer you. Actual pricing varies widely. Always read the full agreement, and consider taking independent professional advice before entering into a financing arrangement.