A term loan spreads a long-lived purchase over fixed monthly payments. The examples cover an office move, practice software, a down payment comparison, how each payment splits, a server replacement and four versus seven years.
At a glance
- Payment
The same amount every month until the end date
- Fits
Office moves, computers, software, equipment packages
- Outside this site
Buildings, land and construction loans
An office move spread over five years: workstations, a copier and movers for a Collierville, TN accounting firm
Moving an existing firm into a larger suite brings one-time costs, most of them things the firm will use for years: new workstations, a network copier and scanner, and the movers who carry the files. A term loan spreads those costs over the years the computers and copier serve.
Illustration only, invented figures: a Collierville, TN accounting firm budgets $38,900 for workstations, a copier, a scanner and movers and finances it over 60 months at a 10.35% annual rate. The invented payment is $833.23, the invented total $49,993.80, and the invented interest $11,093.80.
Walls, wiring, cabling and any change to the suite are property work and fall outside this site, and so do desks, chairs and other office furniture; that side needs a separate arrangement.
Which type of loan fits a purchase that lasts years? EHR software and exam-room computers at a Shelby County, TN physician office
An electronic health record system comes as a bundle: software licenses, setup and training, plus the computers and tablets in each exam room. Equipment financing secures the payment with the item, a fit for hardware, while software has little resale value to secure anything. A term loan can cover the whole bundle in one payment.
Illustration only, invented figures: a physician office prices EHR software, setup and exam-room computers at $27,400 and takes a 48-month term loan at an 11.15% annual rate. The invented payment is $710.16, and the invented total is $34,087.68.
A practice weighing an EHR bundle like this one has company nearby: ZIP Code Business Patterns found 34 offices of physicians at ZIP 38017 street addresses in 2023 (NAICS 6211).
Ten or twenty percent down: how a down payment changes a Shelby County, TN quick-service restaurant’s term loan
For a quick-service restaurant buying order screens and point-of-sale terminals, a down payment lowers the amount financed, which lowers both the payment and the interest. It also takes cash out of the business on day one, so the comparison has two sides.
| Down payment | Financed | Monthly payment | Payments total | Cash out with the down payment |
|---|---|---|---|---|
| 10% ($3,360) | $30,240 | $789.67 | $37,904.16 | $41,264.16 |
| 20% ($6,720) | $26,880 | $701.93 | $33,692.64 | $40,412.64 |
Putting 20% down cuts the invented payment by $87.74 and the invented interest by $851.52, but it uses an extra $3,360 of invented cash at the start. Equipment like this belongs to a large local trade: 790 limited-service restaurants with paid staff in Shelby County, TN, per 2023 County Business Patterns (NAICS 722513).
Fixed payments and a set end date: a business term loan on workstations at a Shelby County, TN accounting firm
Each payment on a term loan pays the interest due for that month first, and the rest reduces the balance. The payment stays the same, but the split shifts toward principal as the balance falls.
Illustration only, invented figures: an accounting firm finances six workstations for $16,800 over 36 months at an 11.8% annual rate, for an invented payment of $556.40. Of the first invented payment, $165.20 is interest and $391.20 is principal; by the last invented payment, interest is down to $5.42.
Paying extra toward principal shortens the loan only if the offer allows it without a charge, so it is worth raising on a call with Baydale before signing.
The blog carries fixed-schedule arithmetic into other cases: three interest-only months at a veterinary clinic, interest and principal by year on a practice loan, a lease total next to a loan total, a dental handpiece order and hotel meeting-room equipment.
Small business term loans in plain numbers: a server replacement at a Shelby County, TN accounting firm
A small business term loan is the same product at a smaller size: a fixed amount, a fixed number of months and one payment that stays level. It fits a single purchase with a clear price, such as a server replacement.
Illustration only, invented figures: a Shelby County, TN accounting firm replaces its file server and backup unit for $21,950 on a 42-month term at a 10.9% annual rate. The invented payment is $630.97, and the 42 invented payments come to $26,500.74, which includes $4,550.74 of interest.
Shelby County, TN counted 1,599 professional, scientific and technical services establishments with paid staff in 2023 (CBP, NAICS 54), the sector that includes accounting and law offices.
Long-term loans compared: four years versus seven on a Collierville, TN dental office’s imaging upgrade
Stretching the same imaging price over more months shrinks each payment and grows the interest bill. Whether that trade makes sense depends on how long the purchase will be in use.
| Term | Monthly payment | Total paid | Interest |
|---|---|---|---|
| 48 months | $1,480.04 | $71,041.92 | $12,741.92 |
| 84 months | $969.36 | $81,426.24 | $23,126.24 |
Seven invented years instead of four trims $510.68 from each monthly payment and piles on $10,384.32 of interest. Any electrical or shielding work in the operatory is property work outside this site; the imaging units themselves are equipment.
By Baydale Funding Group · Updated
