Commercial Mortgage Calculator
Calculate monthly payments and assess rental income coverage for your commercial mortgage. Get instant estimates to help plan your investment strategy.
Commercial Mortgage Calculator
Calculate monthly payments and assess rental income coverage for your commercial mortgage
Typical range: £50,000 - £10,000,000+
Current typical range: 4.5% - 8.5%
Most common: 15-25 years
Expected gross monthly rental income
Important Notes:
- • This calculator provides estimates only - actual rates may vary
- • Most lenders require rental income to cover 125% of mortgage payments
- • Additional costs include arrangement fees, valuation, and legal costs
- • Interest rates depend on LTV, property type, and borrower profile
How Commercial Mortgage Calculations Work
Payment Calculation
Monthly payments are calculated using the loan amount, interest rate, and term length. Commercial mortgages typically use a standard amortization formula.
Rental Coverage
Lenders typically require rental income to be at least 125% of the mortgage payment to ensure sufficient coverage for void periods and maintenance.
Affordability Assessment
Our calculator provides an initial affordability assessment based on the rental coverage ratio and typical lender requirements.
Important Considerations
Factors Affecting Your Rate
- • Loan-to-Value (LTV): Lower LTV typically means better rates
- • Property Type: Standard commercial properties often have better rates
- • Borrower Experience: Experienced investors may qualify for preferential rates
- • Term Length: Shorter terms often have lower rates but higher payments
- • Market Conditions: Economic conditions affect available rates
Additional Costs to Consider
- • Arrangement Fees: Typically 1-2% of loan amount
- • Valuation Fees: £500-£5,000+ depending on property value
- • Legal Costs: £1,500-£5,000+ for mortgage legal work
- • Survey Costs: For more complex properties
- • Broker Fees: Professional advice and arrangement services
Common Commercial Mortgage Scenarios
Owner-Occupier Purchase
Loan Amount: £500,000
Rate: 5.5% (25 years)
Monthly Payment: ~£3,053
Typical scenario for a business purchasing their trading premises. Rates often competitive due to owner-occupier status.
Investment Property
Loan Amount: £750,000
Rate: 6.2% (20 years)
Monthly Payment: ~£5,526
Required Rent: ~£6,907/month
Investment property with 125% rental coverage requirement. Rental yield crucial for approval.
Portfolio Addition
Loan Amount: £1,200,000
Rate: 5.8% (25 years)
Monthly Payment: ~£7,464
Required Rent: ~£9,330/month
Experienced investor adding to existing portfolio. May benefit from relationship pricing with specialist lenders.
Ready for Professional Advice?
While our calculator provides useful estimates, every situation is unique. Get personalised advice and access to exclusive rates from our commercial mortgage specialists.
Important: This calculator provides estimates only and should not be considered as financial advice. Actual mortgage terms, rates, and eligibility will depend on your specific circumstances, property details, and lender criteria. All commercial mortgages are subject to application, financial circumstances, and property assessment. We recommend speaking with our qualified advisors for personalised guidance.