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Commercial Mortgage Calculator

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yrs
yrs

Commercial loan estimate

Monthly payment$5,301
Balloon balance due (yr 7)$650,010
Total interest through term$345,281
Total paid through term$445,271
Payments amortize over 25 years; the remaining balance is due as a balloon at the 7-year term.

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About the commercial mortgage calculator

A commercial mortgage calculator estimates payments on loans for income-producing or business-use property — offices, retail, multifamily, warehouses and the like. Commercial loans work differently from home mortgages: they often use a longer amortization for the payment but a shorter term, leaving a large balloon balance due at the end.

This tool helps investors and business owners model the monthly payment and, crucially, the balloon amount they'll need to refinance or pay off when the term expires. Commercial loans commonly amortize over 25 to 30 years but mature far sooner — often on 5- to 10-year terms — leaving a balloon balance due at the end. They also tend to carry higher rates than residential mortgages, so understanding the structure is essential before committing.

Use the calculator to test how amortization length and term interact, and to confirm the property's income can comfortably cover the payment. A practical tip — lenders evaluate the debt-service-coverage ratio (net operating income divided by debt payments) and typically require a minimum of about 1.20x to 1.25x, so size your loan with that cushion in mind.

Frequently asked questions

How is a commercial mortgage different from a residential one?
Commercial loans usually have shorter terms, higher rates, and a balloon payment, and they're underwritten on the property's income rather than just personal credit. Amortization commonly stretches 25 to 30 years even when the loan term is only 5 to 10, leaving a balloon balance due at maturity.
What is a balloon payment?
A balloon is the large remaining balance due at the end of a loan term that amortizes over a longer schedule. Borrowers typically refinance or sell to cover it, since the regular payments don't fully pay off the loan within the term.
What is debt service coverage ratio (DSCR)?
DSCR is the property's net operating income divided by its annual debt payments. Commercial lenders generally require a minimum DSCR of about 1.20x to 1.25x, meaning income comfortably exceeds the loan payment, before approving financing.
How much down payment do commercial loans require?
Commercial mortgages typically require larger down payments than home loans — often 20% to 35% of the property value, depending on the property type, the borrower's strength, and the lender's requirements.

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