CALCULATION GUIDE
How to Calculate a Maximum Commercial Mortgage
Understand how DSCR, LTV and debt yield can each limit loan proceeds.
Calculation approach
A lender may calculate separate maximum loans from property value, annual debt-service capacity and NOI divided by a minimum debt yield. The lowest result becomes the binding constraint.
How to use the result
Changing amortization or interest rate changes the DSCR-constrained amount, while value affects LTV and NOI affects both DSCR and debt yield.