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Commercial Mortgage Calculator

Commercial mortgage Finance Calculator by Revolution Brokers:

Working out how much your mortgage repayments will be each month can seem complicated! Use our Mortgage Repayment Calculator to make it simple to understand and compare costs

Property or loan details

Error: Property must be valued at £50,000 or more.

Error: Estimated rental income must be between £1 and £99,999.

Based on your details, you can borrow up to:


This calculator is an estimation of how much you could borrow. If you’re ready to take out a mortgage, speak to a Revolution brokers to see what options are available.

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Whether you are considering a commercial mortgage to refinance and raise capital or wish to expand your investment portfolio, choosing your commercial mortgage is a long-term decision.

The Revolution Brokers commercial mortgage calculator helps you instantly compare different mortgage rates and different investment scenarios to help you understand the best course of action.

Commercial mortgages are a go-to option for business owners who wish to purchase real estate or land. The loan is obtained from a bank or other specialised lender, much like residential mortgages, and is paid back over a predetermined period of time in monthly installments with interest. Below, we are discussing more details.

How To Calculate Commercial Mortgage Payments?

First, figure out how much debt you have on your mortgage (also known as the principal). This is the amount you are borrowing to buy the house. It's simple to calculate: deduct the deposit you saved from the price you paid for the house. For example, your mortgage debt would be £150,000 if you were to purchase a property for £200,000 and put down a £50,000 down.

Check the mortgage you are thinking about applying for to find the annual interest rate, which is usually displayed as the starting interest rate.

The mortgage term indicates the length of time you plan to pay off the mortgage.
Although mortgage terms used to normally last 25 years, they can now last up to 35 years.
Reducing your monthly repayment amounts is one advantage of an extended mortgage term. The disadvantage is that it will take longer to pay off the loan, ultimately resulting in higher interest rates as well.

How To Get A Commercial Mortgage In the UK?

To be eligible for a commercial mortgage, you must be accepted by the lender and pass their eligibility requirements, which often consist of:

  • The cash flow and any outstanding obligations to evaluate your business's financial standing
  • The anticipated revenue of your company to ascertain your ability to repay the loan
  • Your capacity to cover the deposit (20% to 40% of the total loan amount).
  • You might also consider rental income because it will impact the cash flow of your company.
  • Assets, credit, and general income.

LTV ratios on commercial properties

One of the most crucial factors in securing a commercial mortgage is the loan-to-value ratio. This ratio compares the value of the commercial property and your annual mortgage repayments against the future revenues generated by rental income.

This factor is essential, as many lenders will base their commercial mortgage offers against a capped LTV ratio.

When you complete the commercial mortgage calculator information and review your credit history, be sure to provide the purchase price of the commercial property or the valuation if you are mortgaging against an existing property. The estimated monthly rental income will help us calculate the mortgage options that are available instantly.

Remember that the lower the LTV value, the more economical the associated interest rate is, since the risk to the lender is more moderate.

Interest cover ratios (ICRs) on commercial mortgages

The interest cover ratio (ICR) is another calculation you will come across when considering commercial mortgage rates. This ratio uses the revenue created by your investment compared to the interest incurred over the same period.

Mortgage lenders need to complete an affordability assessment before extending any offers of lending, so this calculation makes sure that your commercial mortgage is affordable as well as allow you to see the monthly mortgage payments alongside the loan amount.

As an indication, an ICR of two or more is usually considered acceptable. The criteria for ICR vary between lenders, and they may have other measures that are considered more valuable.

How much to apply for on a commercial mortgage

Our business mortgage calculator will instantly tell you what level of mortgage offer we anticipate you will be able to secure against your property and what the monthly repayments will be on your capital repayment mortgage.

This takes into account several different factors, including:

  • The purpose of the mortgage is what you are raising finance for.
  • What your ICR is - the percentage indicates how the rental revenue compares to the repayment mortgage costs. For example, 140% means that your rental income will be to a value of 140% of the mortgage payments.
  • How much is the property going to cost or be valued at?
  • What is the monthly rental income expected to be?
  • What are the monthly payments going to be

Using Our Commercial Mortgage Calculator To Calculate Monthly Mortgage Repayments

  1. Let us know what your borrowing is for. This could be for:
  • A property purchase
  • To raise capital
  • To remortgage without raising capital
  1. Tell us your anticipated ICR. Options include:
  • Personal or company commercial mortgage applications
  • Semi-commercial properties - i.e., part commercial and part residential mortgage
  • HMOs (houses of multiple occupancies) up to six beds or over six beds
  • Buy-to-let investment properties
  1. Enter the property's cost or value. If you are unsure, please use an estimated total, although you should be aware that the commercial mortgage options available may vary when the accurate value is known.

  2. Let us know your anticipated rental income from your property investment.

If the available options do not cover your commercial mortgage needs, please call 0330 304 3040, and we will be happy to provide a quick indication of your mortgage options.

Once you click the calculate button, you will receive an instant indication of the value of the mortgage we think will be available to you.

For specific commercial mortgage advice and a tailored quote, give us a call. We work with specialist lenders across the commercial mortgage market to offer outstanding deals and flexible terms.


Which formula is applied when calculating a 30-year mortgage's payments?

Use the mortgage formula UK to determine monthly payments for a 30-year mortgage by following these steps.

Calculate your monthly interest payments first. This entails multiplying the total amount borrowed by the decimal representation of the annual mortgage interest rate (e.g., 2.5% becomes 0.025).
For example, if your yearly interest rate is 0.025 and you owe £150,000 on your mortgage, the calculation goes as follows: Mortgage debt of £150,000 times annual interest of 0.025 is £3,750.
Then, divide this sum by 12 (the number of months in a year) to determine your monthly interest payments: £312.50 is £3,750 ÷ 12.

What formula is used to determine principal repayments?

This formula, which is expressed as A = P (r (1+r)^n) / ( (1+r)^n -1), requires a complex computation.
To make things easier, let's now concentrate on the average monthly principal repayment during the term of the mortgage. Assuming there aren't fluctuations or variable interest rates, mortgage structures guarantee set payback schedules. Early payments usually go mostly towards interest; as the mortgage draws to an end, debt reduction becomes increasingly important.

To calculate the total payments, start by multiplying the mortgage term in years by 12 (the number of months in a year). For example, 360 payments are made on a 30-year mortgage (30×12=360).
To determine the average monthly payback, divide the mortgage debt by the total number of installments. £150,000 ÷ 360, for instance, equals £416.67.

You will be owing £416.67 on average per month for 30 years. Determine the average amount of interest paid. Think about the halfway point of your mortgage term, when around one-third of the loan is paid off. Determine interest rates again using this lower debt. For example, £100,000 is left over after you have paid back one-third (£50,000) of £150,000. Calculate interest on this amount per month: £100,000 (loan amount) × 0.025% (interest rate per year) = £2,500. After that, divide by 12 to get the interest payment per month: £208.33 is £2,500 ÷ 12.

Lastly, double the average monthly capital payback by the new monthly interest computation, which comes out to be £625 (£208.33 + £416.67). This indicates that throughout the course of the thirty years, you will pay, on average, £625 each month.

What is the monthly payment amount in the UK for a commercial mortgage of £150,000?

The monthly repayment for a £150,000 loan would be £597 if the mortgage had a 30-year term and a 2.5% interest rate. Make use of the offered computations to project your possible repayments and obtain understanding of your financial obligation.

How simple is it for you to calculate your mortgage payments?

If you find mathematics difficult, there is an easier way to figure out how much you have to pay back on your mortgage. Your projected monthly payments for a 30-year mortgage with a 2.5% annual interest rate would be £40 for every £10,000 borrowed. Start by dividing the total amount of your mortgage by £100,000 to calculate your monthly repayment. For example, the calculation would be £150,000 ÷ £10,000 = 15 if your mortgage was £150,000. Then double this figure by forty pounds. To continue the example, we have 15 x £40 = £600. remarkably near to the £597 absolute sum. Generally speaking, for every £10,000 borrowed, a 0.25% increase in your mortgage rate will result in an extra £2 in monthly repayments.

For every £10,000 in mortgage debt, you would need to add an extra £4, for instance, if your mortgage interest rate is 3.0% rather than 2.5%. For every £10,000 borrowed, your interest payment would be £44 as a result. If your mortgage rate falls to 2.0%, on the other hand, deduct £4 for each £10,000 borrowed. For every £10,000 borrowed in this case, interest would cost you £3.

What is the monthly installment on a 20-year commercial mortgage?

If you decide on a 20-year mortgage term, you will be dealing with several parts. With a 2.5% annual mortgage interest rate, your monthly payments for a £10,000 loan will be £53.50. For every £10,000 borrowed, a 0.25% increase in the mortgage interest rate would mean that your monthly repayments would increase by about £1.25.

How much would a 20-year mortgage cost per month?

When selecting a 20-year mortgage term, the financial components must be modified. In this case, based on a 2.5% annual mortgage interest rate, your monthly payments will be £53.50 for every £10,000 borrowed. For every 0.25% increase in the mortgage interest rate, you should budget an extra £1.25 per £10,000 borrowed each month for repayments.

Is it possible to get a commercial mortgage with a bad credit history?

Yes. There are a lot of commercial mortgage lenders available, and some of them accept applications from borrowers with poor credit. These specialised lenders might do further actions, such as the following, to reduce the risk of lending to you:

  • Putting a higher mortgage rate on you
  • Requesting further security from you for the loan
  • Requesting a personal guarantee from the company's directors means that if your business is unable to repay the loan, you will be held personally liable.
Almas Uddin
Almas Uddin

Founder and Mortgage Advisor

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FCA disclaimer

The content included in our articles, blogs, web pages and news publications is based on information accurate at the time of writing. Note that policies and criteria can change regularly throughout the UK mortgage lending market, and it remains essential to contact the consultation team to receive up to date guidance. The information included on the Revolution Brokers site is not bespoke to any circumstances or individual application scenarios and therefore is not intended to be used as financial advice. The content we share is designed to be informative and helpful but cannot be relied upon to provide individual advice relevant to your mortgage requirements. All Revolution team members are fully qualified, trained and experienced to provide mortgage advice of an independent nature.

We collaborate with lenders and providers who are regulated, authorised and registered with the Financial Conduct Authority (FCA). Should you require specific mortgage borrowing types, some products such as buy to let mortgages may not be FCA regulated. The Revolution team can provide further information about regulated and unregulated lending as required. Please remember that a mortgage is a debt which is secured against your home or property. Your home can be at risk of repossession if you do not keep up with the repayments or encounter any other difficulties in managing your mortgage borrowing responsibly. This also applies to any remortgage or home loan secured against your property, including equity release products.

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