Commercial Real Estate Finance Tool
Commercial Mortgage DSCR & Maximum Loan Calculator
Estimate the loan a commercial property may support based on net operating income, debt-service coverage and loan-to-value. See which underwriting constraint is likely to determine the maximum proceeds.
Understanding the result
Cash flow and value both matter.
Commercial mortgage proceeds are commonly limited by more than one test. The property must generate enough net operating income to service the proposed debt at the lender's required DSCR, and the mortgage must remain within the lender's maximum loan-to-value.
This calculator estimates both limits and uses the lower amount as the indicative maximum loan.
How net operating income is estimated
Effective gross income equals potential gross property income, less the selected vacancy and credit-loss allowance, plus recurring other property income. Operating expenses are then deducted to estimate net operating income.
Why a lender may calculate a different result
- Market rent may be used instead of contractual rent.
- A stabilized vacancy allowance may apply even when occupancy is high.
- Management fees and replacement reserves may be added.
- Some other income may be excluded.
- Interest rates may be stressed above the proposed rate.
- Amortization, DSCR and LTV vary by property, borrower and lender.
For a deeper explanation, read Commercial Real Estate DSCR in Canada.
Planning a commercial purchase or refinance?
CFM can assess the property, borrower, financing structure and likely lender requirements—not just the output of a calculator.
Confidential inquiries welcome.