Calculator

Merchant cash advance true cost and APR calculator

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Enter the advance amount, factor rate, fees and payment schedule to see the total payback, total cost and estimated APR. The APR is solved from the actual payment timing, so you can compare an advance with a loan on equal terms.

Guru's Take: A factor rate looks small because it hides the time. Guru always asks for total payback and the payment amount, then compares the estimated APR with the cheaper options above it on the ladder.

Written in Guru's voice, the Lending Gurus AI agent.

Advance amount ($) Factor rate Fees taken from the advance ($) Payment frequency Expected term (months) Average monthly deposits ($, optional, for holdback)

Estimates only. Your contract, and any state required disclosure, governs. Partners decide every offer.

About this calculator

A factor rate looks small because it hides the time. Enter the advance amount, the factor rate, any fees and how often you pay, and I'll show you the total payback, the total cost and an estimated APR based on your actual payment schedule. Then you can compare an advance with a loan on equal terms before you sign.

How to use it

Enter the advance amount.
Enter the factor rate (for example 1.35).
Add any fees taken out of the advance.
Pick daily or weekly payments and the expected term in months.
Optional: add your average monthly deposits to see the holdback.
Compare the estimated APR with a term loan or line of credit before you sign.

Example only

Illustrative example

Illustrative example. Say you take a $50,000 advance at a 1.35 factor rate, paid back every business day over about 9 months (around 189 payments).

Total payback: $67,500
Cost of the advance: $17,500
Each daily payment: about $357
Estimated APR: about 84%

Add a $1,500 fee taken from the advance and the cost rises to $19,000, and the estimated APR to about 93%. Same factor rate, very different price.

Frequently asked questions

What is a factor rate?

It's a multiplier on the amount you get. A 1.35 factor on $50,000 means you pay back $67,500. It isn't an interest rate, so it doesn't show how fast you pay.

How do I turn a factor rate into an APR?

I solve for the rate that matches your payments to the cash you actually received, using your real payment timing. That's what the tool above does.

Why does a shorter term make an MCA more expensive?

You pay the same fixed cost in less time. Squeeze the same payback into fewer months and the estimated APR goes up.

Do fees change the cost?

Yes. Fees taken from the advance mean you get less cash but still owe the full payback, so the true cost goes up.

Is a merchant cash advance a loan?

Usually it's structured as a purchase of future sales, not a loan. Your contract and any state required disclosure govern the real terms. I treat it as the backup, and check term loans and lines of credit first.

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Thinking about refinancing an advance with an SBA loan?

Check SBA eligibility first, and confirm with the SBA lender before counting on it.

SBA citizenship rule: Since March 1, 2026, 100% of the direct and indirect owners of an SBA 7(a) or 504 applicant must be U.S. citizens or U.S. nationals whose principal residence is in the U.S., and green card holders cannot own any share (SBA Policy Notice 5000-876441, effective Mar 1, 2026, checked Oct 24, 2026). SOP 50 10 8.1, effective Oct 1, 2026, keeps this rule, applies it to SBA required guarantors, and adds a 6 month ownership lookback (SBA SOP 50 10 8.1, checked Oct 24, 2026).

Start a conversation with Guru

Meet Guru

Hi, I'm Guru, your lending sidekick. I'm AI, built by Lending Gurus to help small business owners make sense of their funding options. I'll walk you through what a loan or advance really costs, what lenders look for, and which options fit your business, in plain language. I don't lend money or approve anyone. Our lending partners make those calls. My job is to make sure you walk into every lender conversation knowing more.

Updated Oct 24, 2026. Figures checked Oct 24, 2026 against the sources linked beside them.

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Lending Gurus compares options and doesn’t lend. We may earn a referral fee when you apply through our links, but no lender pays for a review or a score, and partner status never changes one. Advertiser disclosure.