Estimate your commercial property loan repayments. Compare interest-only vs principal & interest, check your LVR, and see the full amortisation schedule.
| Structure | Initial repayment | Total interest | Total cost |
|---|---|---|---|
| Principal & Interest(selected) | $3,675.25 | $582,576 | $1,102,576 |
| Interest Only (3yr IO then P&I) | $3,033.33 | $609,773 | $1,129,773 |
Interest-only costs $27,197 more in total interest over the life of this loan, but gives you $641.92 lower repayments during the IO period.
| Frequency | Repayment | Total interest | Total cost |
|---|---|---|---|
| Weekly | $847.44 | $581,666 | $1,101,666 |
| Fortnightly | $1,695.29 | $581,939 | $1,101,939 |
| Monthly(selected) | $3,675.25 | $582,576 | $1,102,576 |
Switching from monthly to weekly repayments could save you $909 in interest over the life of this loan.
Toggle between interest-only and principal & interest to see how each structure affects your cash flow. IO gives lower repayments upfront but costs more in total interest over the loan life.
Adjust the loan amount relative to the property value to see how LVR changes. Staying below 65% LVR typically gives access to better rates and fewer conditions.
Try different interest-only periods from 1 to 5 years. A longer IO period keeps repayments low for longer but means a shorter P&I period with higher repayments afterward.
Commercial property loans range from 5 to 30 years. A longer term reduces repayments but increases total interest. Most commercial loans settle on 15-25 year terms.
Lenders review your business profit and loss, balance sheet, and cash flow to assess serviceability. At least 2 years of financial statements are typically required.
The type of commercial property (office, retail, industrial) and its location affect the LVR, rate, and terms offered. Properties in established commercial areas are generally viewed more favourably.
For investment commercial property, lenders assess the rental income and lease terms. Long-term leases with strong tenants improve your borrowing capacity.
Most commercial lenders require at least 20-35% equity contribution. A lower LVR generally means a more competitive rate and fewer conditions on the loan.
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Most commercial property lenders cap the loan-to-value ratio (LVR) at 60-70% for standard transactions. Some lenders will go to 75-80% for strong applicants or lower-risk property types, but expect higher interest rates and stricter serviceability requirements at higher LVRs. Owner-occupied commercial property may attract slightly more favourable LVR limits than investment commercial property.
Interest-only (IO) repayments mean you only pay the interest on the loan each period, with no reduction in the principal balance. This results in lower repayments during the IO period but means you owe the same amount at the end of it. Principal & interest (P&I) repayments are higher because each payment reduces the loan balance as well as covering interest. Most commercial borrowers start with an IO period of 1-5 years to manage cash flow, then switch to P&I for the remaining term.
Commercial property loan interest rates in Australia typically range from 6% to 8% p.a., which is generally 1-2% higher than residential mortgage rates. The rate you are offered depends on the LVR, the property type, your business financials, the loan size, and the lender. Fixed and variable rate options are available. The rate used in this calculator is for illustration only.
Yes. Commercial property loans are available for all property types including offices, warehouses, retail shops, industrial units, medical suites, and mixed-use properties. However, the LVR limits, interest rates, and loan terms may vary depending on the property type. Specialised properties (e.g. service stations, hotels) are considered higher risk and may attract lower LVRs and higher rates.
Common fees include application or establishment fees ($500-$2,000), commercial property valuation ($2,000-$5,000 depending on property type and value), legal and documentation fees ($1,500-$3,000), and ongoing account-keeping fees. Some lenders also charge line fees or risk fees on higher-LVR loans. These fees are not included in the calculator estimates.
Yes. This is known as cross-collateralisation. Offering your residential property as additional security can improve your effective LVR and help you qualify for a larger commercial loan or a lower interest rate. However, it puts your residential property at risk if you default on the commercial loan. Consider the trade-offs carefully and seek independent financial advice before cross-collateralising.
Results are estimates only and should not be relied upon for financial decisions. Actual commercial property loan repayments will depend on the lender, your credit profile, and the specific terms offered. Interest rates used are for illustration purposes only and may not reflect current market rates.
Subject to lender approval, terms and conditions apply.
This calculator is general information only and is not financial advice.