Free calculator
Maturity wall refinance gap calculator
A maturing commercial loan refinances on today’s rate and today’s value. The new loan is the lower of what the income covers at the refinance rate and what the leverage cap allows against current value. Any shortfall against the maturing balance is the equity gap you must fund.
How large is the refinance gap on a sample loan?
| Input | Value |
|---|---|
| Maturing loan balance | $10,000,000 |
| Net operating income | $750,000 |
| Market cap rate | 7.00% |
| Refinance rate | 7.50% |
| Amortization (zero = interest-only) | 360 months |
| Coverage target | 1.25x |
| LTV cap | 65.00% |
Equity gap$3,035,714
- Implied value: $750,000 ÷ 7.00% = $10,714,286.
- Coverage leg on a 30-year schedule: the mortgage constant at 7.50% is about 8.391% a year, so $750,000 ÷ (1.25 × 8.391%) ≈ $7,150,881.
- Leverage leg: $10,714,286 × 65% = $6,964,286.
- The lower leg governs, so the property supports $6,964,286 today.
- Equity gap: $10,000,000 − $6,964,286 = $3,035,714.
The leverage cap governs, so the appraisal is the negotiation. About $3.0M has to come from a paydown, new equity, a bridge loan or a sale before this loan can be retired.
How is a refinance gap calculated?
Implied value = NOI ÷ Cap rate Coverage leg = NOI ÷ (Coverage target × Mortgage constant) Leverage leg = Implied value × LTV cap Equity gap = Maturing balance − lesser leg
- 20,000+loan programs screened
- 5–8matches on a typical deal
- under an hourto the median first offer
- Zero upfrontto submit and compare offers
How do you read the result?
Read the two legs before the gap. A higher rate shrinks the coverage leg and a higher cap rate shrinks the leverage leg, and the calculator separates the two so you can see which one is doing the damage. If coverage is lower, a lower rate or a longer amortization helps; if leverage is lower, only more income or a higher value does.
A gap is a financing question. A paydown, partner equity, a bridge loan while income catches up and a sale are each priced differently by different lenders, which is the case for showing the same numbers to several before renewing with the incumbent.
Frequently asked questions
What is the maturity wall?
The cluster of commercial loans maturing in the same few years at rates and values different from those they were underwritten at. For one borrower the question is narrower: does the property still support the balance coming due?
Does this size the coverage leg on an amortizing payment?
Yes, on the amortization you enter, the same way the loan sizing calculator does. Enter zero to size it interest-only, which allows a larger loan than any amortizing schedule at the same rate and target. Use the basis your lender quotes.
Is the implied value an appraisal?
No. It is your income divided by the cap rate you entered; an appraiser uses their own normalized income and rate, and any difference shows up as a smaller loan.
What does YieldStack do?
YieldStack is a commercial mortgage brokerage. Every term sheet comes from a lender in the network and is subject to that lender's underwriting.
Does it cost anything to see terms?
No. It costs Zero upfront to submit a deal and review offers; YieldStack's broker fee is 0.50–1.00% of the loan amount and is paid only at closing.
Is financing guaranteed?
No. Every credit decision is made by the lender; YieldStack arranges the introductions and negotiates on the borrower's side, and no loan, rate, or closing is guaranteed.
Where does YieldStack operate?
Nationwide. YieldStack arranges commercial real estate financing nationwide. Every deal is business-purpose commercial financing, and the broker fee is paid only at closing.
Bring the number to lenders.Compare the terms they send.
YieldStack is a commercial mortgage brokerage.