Commercial Mortgage Payment Calculator
Calculate your commercial mortgage monthly payment, total interest paid, and key loan metrics using standard amortization formulas.
Formulas Used
Monthly Payment (M):
M = P × [r(1+r)n] / [(1+r)n − 1]
- P = Loan principal (Loan Amount − Down Payment)
- r = Monthly interest rate = Annual Rate / 12
- n = Total amortization months = Amortization Years × 12
Balloon Balance (B) after t payments:
B = P × (1+r)t − M × [(1+r)t − 1] / r
- t = Balloon term months = Balloon Years × 12
Total Interest Paid = (M × t + B) − P
Assumptions & References
- Payments are made monthly at the end of each period (ordinary annuity).
- The interest rate is fixed for the entire amortization period.
- A balloon payment occurs when the loan term is shorter than the amortization period; the remaining principal balance is due in full at the end of the term.
- No origination fees, points, prepayment penalties, or escrow amounts are included.
- LTV (Loan-to-Value) is calculated as Financed Principal / Total Property Value (Loan Amount before down payment).
- Annual Debt Service = Monthly Payment × 12; use this with Net Operating Income (NOI) to compute DSCR = NOI / Annual Debt Service.
- Formula reference: Investopedia – Mortgage Payment Formula; CCIM Institute – Commercial Real Estate Finance.