TOOLS

Commercial Mortgage ^Calculator

A commercial mortgage involves several moving parts, so many SMEs use an online calculator first and then hand the figures to a platform or broker like Funding Agent to source tailored quotes. This calculator helps estimate the key costs and repayments involved. It is designed for business owners planning to finance commercial property purchases or refinancing. You can compare your figures with related options such as commercial mortgages and learn more about business loans.

Secure up to £500,000 in Business Finance with Funding Agent.

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Quick and easy application process
Loan disbursed within 24 hours
No additional charges for early repayment

How To Use The Commercial Mortgage Calculator

Enter loan details

Input the desired loan amount, interest rate type (fixed or variable), repayment term in years, and whether interest is paid monthly or quarterly. Understanding your interest rate and repayment term is important to get accurate results.

Add property information

State the property value and expected rental or trading income; the calculator uses these to gauge loan-to-value (LTV) and debt service coverage ratio (DSCR). For more on these terms, visit the loan-to-value and interest coverage ratio pages.

Review outputs

Check the projected monthly repayment, total interest, and maximum borrowing suggestions. Use these figures to compare offerings from different lenders and prepare for discussions or applications.

^Benefits of Using the Commercial Mortgage Calculator

A Commercial Mortgage Calculator is a valuable tool for business owners and investors to estimate monthly payments, determine loan eligibility, and assess financing options for commercial properties. This calculator streamlines the financing process by enabling users to input loan amounts, interest rates, and terms, providing instant results that facilitate informed financial planning and decision-making.

Running the numbers in advance clarifies affordability, highlights sensitivity to rate changes, and saves time when comparing lenders’ term sheets. This helps in understanding your borrowing capacity clearly and aids in faster budgeting. Use detailed calculators like this alongside guides on business loans to inform decisions.

Faster budget planning

Interest cost clarity

Deal terms benchmarking

Apply for commercial mortgage funding

Generate offers

How Commercial Mortgage is Calculated

Monthly Repayment Formula

Standard amortisation using rate, term, and principal.

Monthly Repayment Formula

Monthly Payment = P × r × (1 + r)^n ÷ [(1 + r)^n − 1], where P is loan amount, r is monthly interest rate (annual rate ÷ 12), and n is total months. This formula amortises principal and interest over the loan term. Learn more about amortisation.

Total Interest Paid

Sum of all payments minus principal.

Total Interest Paid

Total Interest = (Monthly Payment × n) − P. Multiply monthly payment by number of months then subtract principal to find total interest cost over the loan duration. This helps understand actual borrowing cost.

Maximum Borrowing Limit

Lower of LTV or DSCR thresholds.

Maximum Borrowing Limit

Max Loan = min(Property Value × LTV%, Net Operating Income ÷ (r × DSCR)). LTV is usually 65–75%. DSCR ensures Net Operating Income divided by debt service meets target, often 1.25, to guarantee affordability.

Understanding Your Commercial Mortgage Calculator Results

Affordability check

Compare the monthly repayment against projected business cash flow and ensure a comfortable buffer. This helps avoid financial strain and supports sustainable repayments. Refer to the cash flow concept for further insight.

Sensitivity awareness

Note how extending the term lowers payments but raises total interest, while higher rates quickly increase both. This sensitivity to rate changes is important for planning and risk management.

Mind the assumptions

Results exclude arrangement fees, legal costs, and potential rate hikes on variable deals; factor these before committing. Always review full terms and conditions with your lender or advisor.