Exclusively for UK Limited Companies & SPVs

Commercial Mortgage Calculator UK

Model indicative monthly repayments, assess Capital & Interest vs Interest-Only structures, and evaluate bank Interest Cover Ratio (ICR) stress tests for UK corporate property debt.

Applying for a UK Limited Company Commercial Mortgage?

Review our whole-of-market Commercial Mortgages facility or consult our Complete Commercial Mortgages Guide.

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UK Limited Companies & SPVs•Updated for 2026 Terms

Commercial Mortgage Debt & ICR Calculator

Model capital & interest amortisation, interest-only payments, and bank stress-testing covenants.

£
£100k£2.5M£5M+
Calculated LTV: 66.7%
£
Deposit: £250,000
%
Prime (4.5%–5.5%)Commercial Standard (5.5%–7.0%)Specialist (7.0%+)
25 Years
5 Yrs15 Yrs25 Yrs30 Yrs
Contracted / Projected Lease Rent
£
Annual: £54,000Yield on Value: 7.20%
Benchmark coverage covenant

UK commercial lenders require rental income to exceed debt payments by 125%–145% to absorb void periods, insurance, and maintenance.

Indicative Debt Service
£3,161 / month
Annual debt commitment: £37,928 (Amortising Principal & Interest)
142%
Rental ICR Achieved
Target: 125% Cover
✓
Underwriting Assessment: Strong Coverage (142% vs 125% required) — Comfortably satisfies underwriting rental stress tests.
Loan-to-Value (LTV)
66.7%
Equity: £250,000
Max Loan on Current Rent
£569,502
At 125% ICR test
Min Rent Required
£3,951/mo
To satisfy 125% ICR
Total Interest Payable
£448,197
Over 25 years

Indicative Transaction & Lender Costs (Estimated)

Lender Arrangement Fee (~1.5%)
£7,500
Usually added to loan facility
Commercial Valuation Survey
~£1,400
Paid upfront to RICS valuer
Borrower & Lender Legal Fees
~£2,500
Dual representation commercial solicitors
Important Disclosures: Indicative figures only. Actual lending rates, arrangement fees, and loan-to-value limits depend on borrower credit profile, asset class, tenant covenant strength, and lease length. Hello Leads Ltd originates and matches commercial mortgages exclusively for UK Limited Companies, SPVs, and LLPs. We are an introducer and matching platform, not a broker. Commercial mortgages are not regulated by the Financial Conduct Authority (FCA).
Underwriting Mechanics

How Commercial Mortgage Calculations Work in the UK

Unlike residential consumer mortgages based solely on individual salary multiples, commercial debt is underwritten against asset yield, corporate cashflow, and stress-tested covenant ratios.

1

LTV & Equity Sizing

Loan-to-Value (LTV) represents the percentage of the property valuation a lender will fund. Commercial facilities typically cap at 70% to 75% LTV, requiring the corporate borrower to contribute a minimum 25% cash equity deposit.

Read First-Time Buyer Guide →
2

ICR & Debt Coverage

The Interest Cover Ratio (ICR) benchmarks the rental revenue against debt obligations. For UK Limited Companies, lenders require between 125% and 145% coverage at a nominal stress rate to ensure financial viability through economic cycles.

Read SPV vs Personal Guide →
3

Amortisation Structure

Borrowers can select Capital & Interest amortisation (gradually reducing loan principal over 15–25 years) or Interest-Only facilities (retaining maximum operating liquidity, typically paired with a 5-year refinance horizon).

Read Commercial Mortgage Guide →

Commercial Lending Benchmarks & Rate Factors

Pricing Variables

  • •Reference Rate Margins: Commercial loans are priced over the Bank of England Base Rate or SONIA (typically base + 2.25% to 4.5%).
  • •Tenant Covenant Strength: Properties let to Blue-Chip or governmental tenants secure tighter margins than short unexpired lease terms.
  • •Asset Classification: Prime logistics and modern light industrial units command lower interest rates than high street retail or leisure assets.
  • •Director Track Record: Established property companies with proven landlord experience receive tier-1 lender terms.

Estimated Transaction Costs

  • •Lender Arrangement Fees: Generally 1.0% to 2.0% of the gross loan amount, usually capitalised onto the advance.
  • •RICS Commercial Valuation: £1,200 to £5,000+ depending on asset complexity, turnover, and market value.
  • •Dual Legal Representation: Corporate commercial mortgages require separate legal representation for both borrower and lender.
  • •Non-Residential Stamp Duty (SDLT): Tiered commercial HMRC tax (0% up to £150k, 2% £150k–£250k, 5% thereafter).
Got Questions?

Frequently Asked Questions

Technical guidance on UK Limited Company commercial mortgage underwriting.

What interest rates can our UK Limited Company expect on a commercial mortgage?

Commercial mortgage interest rates in the UK generally range from 4.5% to 8.5% per annum, priced as a commercial lender margin (typically 2.0% to 4.5%) above the Bank of England Base Rate or SONIA. Prime owner-occupied trading premises with strong company balance sheets attract the lowest margins, while speculative commercial investment property or complex asset classes command higher margins.

How does the Interest Cover Ratio (ICR) stress-test work for commercial property?

Underwriters apply an Interest Cover Ratio (ICR) covenant to ensure the property rental income sufficiently covers mortgage debt service with a safety cushion. Typical lender hurdles require rental coverage of 125% for Special Purpose Vehicle (SPV) Limited Companies, 130%–135% for semi-commercial mixed-use properties, and 140%–145% for pure commercial investments.

Should our company choose Capital & Interest or Interest-Only commercial finance?

Trading businesses purchasing their own operational premises often choose Capital & Interest repayment to build corporate balance sheet equity and clear the debt over 15 to 25 years. In contrast, property investment SPVs frequently opt for Interest-Only facilities to maximise monthly cash distributions and reinvest liquidity into acquiring further portfolio assets.

What is the maximum Loan-to-Value (LTV) available for UK commercial mortgages?

Standard commercial mortgage facilities provide up to 75% LTV for owner-occupied trading premises and standard investment assets. Semi-commercial properties usually cap at 70% to 75% LTV. Experienced borrowers offering additional corporate security or unencumbered portfolio charges can achieve up to 80%–100% funding through cross-collateralisation.

Are corporate commercial mortgages regulated by the Financial Conduct Authority (FCA)?

No. Commercial mortgages and business debt arranged strictly for corporate entities (UK Limited Companies, SPVs, and LLPs) are unregulated under FSMA 2000 (Regulated Activities Order 2001, Article 61 corporate borrower exemption). Commercial Mortgage Dealer operates exclusively in the unregulated commercial sector for UK corporate entities.

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Statutory Entity & Regulatory Notice: commercialmortgagedealer.com is a trading style of Hello Leads Ltd. Registered in England & Wales. Company No. 10286382. ICO Registration: ZB924628. Registered office: 1 Llandegfedd Close, Cardiff, Wales CF14 9HD.

We arrange commercial debt exclusively for corporate entities (UK Limited Companies, SPVs, and LLPs). Commercial mortgages and loans arranged for corporate entities are not regulated by the Financial Conduct Authority (FCA). We do not arrange regulated consumer mortgages.

Security Warning: Your property or company assets may be repossessed if you do not keep up repayments on a commercial mortgage or any other debt secured on it.