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Commercial Mortgage

Commercial Mortgage Calculator

Calculate monthly payments, debt service coverage ratio (DSCR), and cash flow projections for commercial property investments including offices, retail, and industrial units.

Commercial Mortgage Calculator
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Commercial Mortgage Summary

LTV
66.7%
Monthly Payment
£3,376
Total Interest
£512,811
DSCR
1.48x
Annual Debt Service
£40,512
Gross Yield
8.00%
Net Annual Cashflow
£19,488

DSCR (Debt Service Coverage Ratio) should typically be 1.25x or above. Most commercial lenders require minimum 1.2x coverage.

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Commercial Mortgage Guide

Commercial mortgages are loans secured against business or investment properties including offices, retail units, warehouses, and mixed-use buildings. They differ from residential mortgages in their assessment criteria and typically have shorter terms and higher rates.

Key Assessment Criteria

  • DSCR (Debt Service Coverage Ratio): Rental income divided by annual debt payments. Lenders typically require 1.2x-1.4x minimum.
  • LTV (Loan to Value): Usually capped at 65-75% for commercial properties.
  • Lease Strength: Length of tenant leases and covenant strength affect lending terms.
  • Property Type: Standard offices/retail more acceptable than specialist properties.

Types of Commercial Property Finance

  • Owner-Occupied: For businesses buying their own premises
  • Investment: For landlords purchasing tenanted commercial property
  • Semi-Commercial: Mixed-use properties with residential and commercial elements