Commercial Mortgage Calculator

Estimate monthly payments, annual debt service and the balance due at maturity. Enter your own loan assumptions; results are estimates, not a rate quote or loan offer.

The principal you expect to borrow — the amount financed, not the purchase price and not the property value.

On a purchase, this is the price minus your down payment. On a refinance, it is the existing payoff plus any cash out plus costs you intend to roll in. If you are testing scenarios, try the amount you want and then the amount you think is realistic; the gap between the two payments is often the most useful output on this page.

The annual interest rate, entered as a percentage.

You must supply this. We do not publish rates, quote rates, or populate this field with an assumed number, because commercial pricing is set by the individual lender and varies by property type, leverage, borrower strength, term, and market conditions on the day the loan is priced.

If you have a term sheet, use the rate on it. If you do not, run a range rather than a single figure — testing several rates shows you how sensitive the deal is to pricing, which is more valuable than any single point estimate.

The amortization term is the repayment schedule the payment is calculated from — how many years it would take to pay the loan to zero at that payment.

A longer amortization spreads principal over more payments, which lowers the monthly amount and improves the deal's coverage math. A shorter amortization raises the payment and builds equity faster. Twenty-five and thirty years are common on stabilized commercial property, but there is nothing standard about it; lenders set amortization by asset type and program.

The critical point: the amortization term is a math assumption used to size your payment. It is not a statement of how long you get to keep the loan.

The loan term is how long the loan actually exists before it matures and the remaining balance is due in full.

This is a contractual deadline. When the loan term ends, you repay whatever is left — typically by refinancing, selling the property, or paying it off from other sources. Five, seven, and ten years are frequently seen on commercial loans, though terms vary by lender, property, borrower, and transaction.

Enter the maturity you expect, not the amortization. If you enter the same number in both fields, the loan fully amortizes and no balloon balance remains.

If you take one thing from this page, take this.

Amortization term sets your payment. Loan term sets your deadline. They are two independent numbers and on most commercial loans they do not match.

As a hypothetical illustration: a loan amortized over 25 years but with a 5-year term produces a payment calculated as though you had 25 years to repay it. You make that payment for 60 months. At month 60, the loan matures. But 60 payments on a 25-year schedule have retired only a modest slice of the principal — early payments are mostly interest — so the large majority of what you borrowed is still outstanding on the day it comes due.

That outstanding remainder is the balloon payment: a single lump sum equal to the entire remaining balance, due at maturity. It is not a penalty and it is not a surprise clause. It is the arithmetic consequence of paying on a 25-year schedule for 5 years.

What this means in practice is that a commercial loan is a decision you revisit. You are not financing the property for 25 years; you are financing it for 5, with a payment sized as if it were 25. Before maturity you will need a plan — refinance, sale, or payoff — and that plan will be executed under whatever market conditions exist at that time, not today's.

This calculator makes the consequence visible. Set the amortization and loan term separately, and the balloon balance output shows you exactly what you would owe at maturity.

An interest-only (IO) period is a stretch at the beginning of the loan where you pay only the interest and no principal.

During IO, the payment is lower and the balance does not move — you owe the same amount at the end of the IO period as you did at the start. When IO expires, the loan converts to amortizing payments, and because principal is now being repaid over fewer remaining years, that payment steps up.

IO periods are common on value-add and lease-up deals where cash flow is expected to improve. The tradeoff is that every interest-only month is a month of no equity building, which makes the eventual balloon balance larger. Enter zero if your loan amortizes from the first payment.

The balloon balance is the principal remaining when the loan term ends. Enter the loan term to estimate the balance due at maturity.

Compare different maturities to see how much principal each schedule repays. If you leave the loan term blank, the calculator assumes the full amortization period. When the loan fully amortizes by maturity, no balloon balance is displayed.

The amortizing payment covers interest and principal reduction. The formula is standard amortization math:

Monthly P&I = P x [ i x (1 + i)^n ] / [ (1 + i)^n - 1 ]

P is the loan amount, i is the annual interest rate divided by 12, and n is the number of amortizing months. If an interest-only period is entered, those months are subtracted from the amortization schedule. At a zero rate, principal is divided by the number of amortizing months.

During an interest-only period, the monthly payment is P x i. The calculator labels interest-only and later amortizing payments separately when both occur during the loan term. These payments exclude property taxes, insurance, reserves, escrows and other property costs.

Annualized debt service is twelve times the monthly payment. When there is an interest-only period, the calculator shows the annualized interest-only amount and, where applicable, the annualized amortizing amount separately. A transition year with payments from both periods will differ from either annualized figure.

Lenders compare net operating income against annual debt service to assess debt-service coverage. To test this relationship, enter an appropriate annual debt-service assumption in the DSCR and NOI calculator. Lender methods and required coverage vary.

The principal estimated to remain outstanding at the end of the loan term — the lump sum due at maturity.

It is calculated by amortizing the loan forward payment by payment (including any interest-only months, during which the balance does not decline) and reporting the balance at the end of the loan term.

Read this number carefully. It is the amount you will need to refinance, sell into, or pay off on a specific future date. On a short-term loan with long amortization, it commonly approaches the original loan amount, and that is normal rather than an error. Planning for it is the whole point of looking at it now.

This calculator produces an estimate for planning purposes only. It is not a loan offer, a quote, a pre-approval, an approval, or a commitment to lend.

Every figure shown comes from assumptions you entered. Q Commercial Capital does not supply the interest rate and does not represent that any rate, term, amortization schedule, or loan amount you enter is available to you or to anyone.

Results exclude taxes, insurance, reserves, escrows, origination and lender fees, third-party costs, prepayment provisions, rate adjustments on variable-rate loans, and any structural terms a lender may impose. Actual payments and balances will differ. Loans amortize on the lender's schedule and daycount conventions, which may not match this model.

Q Commercial Capital is the commercial financing division of Q Mortgage LLC and operates as a mortgage brokerage. We place loans with wholesale lenders; we do not lend our own funds and we do not approve loans. All terms and all lending decisions belong to the funding lender and vary by lender, property, borrower, and transaction. Q Mortgage NMLS #2567464.