Rental, Investment and Commercial Real Estate

Commercial Mortgage Calculator Canada

Model commercial mortgage payments, term interest and principal, maturity balance, LTV, loan-to-cost, DSCR, debt yield, financing fees, down payment, and total acquisition cash.

Commercial loan paymentLTV and loan-to-costDSCR and debt yieldFees and acquisition cash

Calculation inputs

Size a commercial mortgage

Model payment, term balance, leverage, debt coverage, debt yield, fees, and acquisition cash.

$
$
$
%
years
years
Financing and closing costs
%
%
$
$

How the calculation works

Understand the formula before relying on the result

Model level payments

The loan amortizes through level monthly principal-and-interest payments using the selected rate convention.

Measure leverage

Loan amount is compared separately with property value and purchase cost.

Test operating coverage

Annual NOI is divided by annual debt service for DSCR and by original loan amount for debt yield.

Build cash requirement

Down payment, percentage financing fees, legal and appraisal costs, and other closing costs are combined.

Interpret the result

Loan sizing is multi-constraint

The lowest result from DSCR, debt yield, LTV, borrower, and property policy may control.

Term is not amortization

The loan can have a long amortization but still require renewal or payout at the end of a shorter term.

Fees change effective cost

Percentage fees and closing costs can be material even when the monthly payment appears manageable.

NOI must be normalized

Lender-adjusted NOI may differ from seller statements or borrower projections.

Common mistakes

  • Sizing the loan from LTV alone.
  • Using gross revenue instead of NOI for DSCR.
  • Ignoring the maturity balance at term.
  • Omitting lender, broker, appraisal, legal, environmental, or due-diligence costs.
  • Assuming residential mortgage pricing or amortization applies to commercial property.

What lenders review

  • Property type, use, zoning, marketability, and location.
  • Rent roll, leases, tenant concentration, and lease expiry profile.
  • Normalized historical and projected NOI.
  • LTV, loan-to-cost, DSCR, and debt yield.
  • Borrower net worth, liquidity, experience, guarantees, credit, and exit strategy.

Planning tips

  • Run the loan through DSCR and debt-yield calculators separately.
  • Use appraisal and lender NOI rather than marketing NOI.
  • Budget environmental, property-condition, and legal due diligence.
  • Model the renewal balance and refinance risk at term.
  • Keep a contingency above the calculated cash requirement.

Connected HopeWell knowledge

Connect the commercial mortgage calculator to the mortgage decision

Use the result alongside HopeWell's guide chapters, glossary definitions, real underwriting case studies, service pages, and related calculators.

Calculation pathway

Related mortgage calculators

Continue into qualification, purchase costs, equity, refinancing, HELOC planning, and mortgage comparison using the connected calculators below.

View calculator platform
Live

NOI Calculator

Build a normalized net operating income statement with vacancy, operating expenses, reserve treatment, margins, and debt-service capacity.

Live

DSCR Calculator

Calculate debt-service coverage, required NOI, maximum debt service, and estimated loan capacity at a target DSCR.

Live

Debt Yield Calculator

Calculate debt yield, maximum loan at target yield, required NOI, loan-capacity difference, and LTV.

Live

Cap Rate Calculator

Calculate stabilized NOI, capitalization rate, target-cap valuation, gross rent multiplier, and operating expense ratio.

Live

Real Estate Investment Return Calculator

Project cash-on-cash return, mortgage amortization, sale proceeds, total profit, equity multiple, and annualized IRR.

Frequently asked questions

Questions about this calculation

How is a commercial mortgage payment calculated?

This calculator uses a level monthly principal-and-interest payment over the entered amortization and selected compounding convention.

What is the difference between LTV and loan-to-cost?

LTV compares debt with property value. Loan-to-cost compares debt with the acquisition price used in this model.

Why do commercial lenders use DSCR and debt yield?

DSCR tests payment coverage, while debt yield compares NOI directly with the loan amount without using the interest rate.

Does the calculator include an interest-only period?

No. This version models an amortizing loan. Actual commitments may include interest-only periods, holdbacks, reserves, or staged advances.

Are lender and broker fees financed?

No. They are included in upfront cash required in this model.