Compare business loan offers on four numbers: the cash you actually receive after fees, the total you repay, the APR, and the payment in a typical month. The offer with the lowest rate or factor on the page often isn't the cheapest loan. Put every offer on the same grid before choosing.
What should I line up side by side?
Offers arrive in different formats. One quotes an interest rate, another a factor rate, a third a flat "total payback." Before you compare anything, pull the same fields out of each one:
| Field | Where to find it | Why it matters |
|---|---|---|
| Amount approved | Top of the offer | The headline number, but not what you receive |
| Net amount funded | Funding or disbursement section | Approved amount minus fees deducted at closing |
| Total repayment | Payment schedule or disclosure | Everything you will pay back over the full term |
| Total cost | Total repayment minus net amount funded | The dollar price of the money |
| APR | Disclosure, or calculate it yourself | The price per year, which makes different terms comparable |
| Term | Repayment schedule | How long the payments run |
| Payment amount and frequency | Repayment schedule | What leaves your account, and how often |
| Prepayment terms | Contract | Whether paying early saves money |
| Personal guarantee | Guarantee agreement | Whether you are personally on the hook, and for how much |
| Collateral | Security agreement | Which assets the lender can claim, and whether it files a blanket UCC lien |
If an offer won't give you the net amount funded and the total repayment, treat that as a red flag. Those two numbers alone let you calculate the true cost.
How do three offers compare in practice?
Say a hypothetical HVAC contractor needs $100,000 to hire two technicians ahead of the summer season. Three illustrative offers come back. These are examples for the arithmetic, not quotes.
- Offer A: Term loan, 14% interest, 24 months, monthly payments, 4% origination fee deducted at closing.
- Offer B: Short-term loan, 1.22 factor rate, 12 months, weekly payments, $2,500 fee deducted at closing.
- Offer C: Short-term loan, 1.28 factor rate, 18 months, daily payments, no fee.
Here is the same grid for all three:
| Offer A | Offer B | Offer C | |
|---|---|---|---|
| Amount approved | $100,000 | $100,000 | $100,000 |
| Net amount funded | $96,000 | $97,500 | $100,000 |
| Payment | $4,801.29 monthly | $2,346.15 weekly | $338.62 per business day |
| Payment per month | $4,801.29 | About $10,167 | About $7,111 |
| Total repayment | $115,230.92 | $122,000 | $128,000 |
| Total cost | $19,230.92 | $24,500 | $28,000 |
| APR | About 18.2% | About 45.9% | About 34.3% |
Offer A puts the least cash in your hand and still wins on the numbers that matter: lowest total cost, lowest APR, and lowest monthly payment. Its 4% fee looks worse than Offer C's zero fee at first glance, and it still comes out ahead by almost $9,000.
B versus C is the more instructive comparison. Offer C costs $3,500 more in total, yet its APR is lower, because the money is outstanding for 18 months instead of 12. Offer B is cheaper in dollars but takes more than $10,000 a month out of the business, about $3,000 more than C. Which is "better" depends on whether the contractor's cash flow can carry B's payment through a slow month.
Which matters more, APR or total cost?
Both, for different questions.
- APR tells you the price of the money per year. Use it to compare offers with different terms fairly.
- Total cost tells you how many dollars leave your business. Use it to decide whether the loan pays for itself.
They can point in opposite directions. Consider two hypothetical $50,000 offers:
| 12-month offer | 24-month offer | |
|---|---|---|
| Pricing | 1.15 factor, weekly payments | 18% APR, monthly payments |
| APR | About 28.1% | 18% |
| Total cost | $7,500 | $9,908.92 |
The 24-month loan has the lower APR and costs about $2,400 more, because you are paying for twice as long. If you will pay off early, or if the money earns its return fast, the shorter offer may cost less in practice. If you need the lower payment, the longer one may be the only one that fits.
How do fees change the comparison?
Fees change both the cash you receive and the true APR. Watch for:
- Origination or funding fees. Often 1–5% of the loan, deducted up front. A 4% fee on $100,000 means you receive $96,000 and repay on $100,000.
- Underwriting, documentation, or closing fees. Flat charges that are easy to miss in a summary.
- Draw fees and maintenance fees on a line of credit. A line with a low rate and a fee on every draw can cost more than a slightly higher rate with no fees.
- Late fees and returned-payment fees. Especially relevant on daily or weekly schedules, where a single low-balance day can trigger one.
Ask each lender for the net amount funded in writing. If the only fee disclosure is a percentage, convert it to dollars.
What should I ask about prepayment?
Prepayment terms can change which offer is cheapest, and they come in three types:
- Interest savings. On an interest-bearing loan, paying early reduces the total interest. If the contractor pays off Offer A after 12 months, they will have paid $57,615.46 in installments plus a $53,474.13 payoff, for a total cost of $15,089.59. That saves about $4,141 compared with running the full term.
- Fixed cost owed in full. On most factor-rate products, the full fee is owed no matter when you pay. Paying off Offer B after 26 weeks still costs $24,500 unless the contract offers a discount.
- Prepayment penalty. Some loans, more often longer-term and real estate loans, charge a fee for paying early.
If there is any chance you will refinance or pay off early, get the prepayment terms in writing and run the numbers both ways. Many term loans through Sagamore's lending partners carry no prepayment penalty, and we flag which offers include that flexibility.
How does payment frequency affect my cash flow?
Frequency changes cost only slightly. It changes cash flow a lot.
To compare, convert every payment to a monthly figure:
- Daily: payment × about 21 business days
- Weekly: payment × 52 ÷ 12
- Monthly: as quoted
Then test it against your slowest month, not your average one. If the contractor's slowest month brings in $60,000 in deposits, Offer B's $10,167 takes about 17% of it, and Offer A's $4,801 takes about 8%. A daily debit also comes out on your worst days, before you've had a chance to move money around.
Seasonal businesses should also ask whether the lender allows payment adjustments during slow periods, and on what terms.
What non-price terms should I compare?
The price is not the whole contract. Before signing, check:
- Personal guarantee. Is it unlimited or capped? If you have partners, is each owner liable for the full amount?
- Collateral and UCC filings. A lien on one piece of equipment is very different from a blanket lien on every business asset. A blanket lien can make your next loan harder to get.
- Confession of judgment. Some contracts include a clause letting the lender get a court judgment without a lawsuit. New York stopped allowing these to be filed against out-of-state borrowers in 2019. Know if one is in your contract.
- Renewal terms. Some lenders offer new money partway through the term, sometimes charging a new fee on the amount you still owe.
- Restrictions on other financing. Some contracts prohibit taking additional financing while the balance is open.
If the money is for a specific asset, compare against equipment financing, where the equipment itself is the collateral and the rest of your assets stay free.
Do lenders have to give me standardized disclosures?
It depends on your state. Federal truth-in-lending rules don't cover business loans. As of 2026, California and New York require commercial lenders to disclose an APR on covered offers, up to $500,000 in California and $2.5 million in New York. Several other states, including Utah, Virginia, Florida, Georgia, and Kansas, require disclosure of the total cost, total repayment, and payment terms, but not an APR. Wherever you are, the grid above gives you the same information.
How do I get offers I can compare?
Sagamore is a broker, not a lender. One application reaches multiple lending partners, and the offers come back with rates, terms, and total repayment amounts laid out so you can compare them on the same basis. The initial review uses a soft credit pull, and there is no obligation to accept. You can start your application here.
