What the property earns
Rent and other property income, less vacancy and operating costs. This is before the loan payment and income taxes.
Ask: Are these actual records or the seller’s forecast?VORA / Commercial property
See past the asking price.
I want you to understand what you’re buying—not just like the listing. Start with the income, the costs, and the questions worth asking before you make an offer.
01
Start with what you know.
No sign-up to use the calculator. Estimates are fine.
03
Three numbers. Plain English.
A higher asking price or an attractive rate doesn’t tell the whole story.
How well it covers the debt
Annual NOI divided by annual loan payments. At 1.00×, they’re equal. Below that, property income doesn’t cover the modeled debt.
There is no universal passing score. Lender definitions and requirements vary.What may be left for you
Property income after its loan payments. A positive estimate still needs room for surprises, major work and other debts.
Test lower rent, a vacant unit and a bigger repair bill before deciding.Look beyond the listing
What I’d check before an offer.
A clean spreadsheet can hide a lease ending soon, a restricted use, or a costly repair. These checks help turn assumptions into facts.
Who pays the rent—and for how long?
Review the rent roll (the list of tenants and their rent), signed leases, unpaid rent, renewal options and lease end dates. Verify deposits and expense reimbursements.
Can you use it the way you intend?
Check permitted uses, zoning, access, parking and any change-of-use approvals with local authorities. The current tenant’s use is not proof yours is allowed.
What work or costs could change the deal?
Review inspections, roof and building systems, environmental concerns, title and insurance quotes. Budget for immediate work, vacancies and tenant improvements.
Selling or leasing instead of buying?
Gather leases, operating statements, improvement records and known issues. An income estimate helps frame the discussion; it is not a listing price or appraisal.
A few things worth clearing up.
Is a business buying its own space the same as a rental investment?
No. An owner-occupied business property needs a review of the business and how it will use the space. A rental investment depends on tenants, leases and property income. SBA 7(a) or 504 may be discussion options for an eligible operating business; 504 is not for passive rental investment. Eligibility and lender review still apply.
Does “25-year amortization” mean the loan lasts 25 years?
Not necessarily. Amortization is the schedule used to calculate payments. The loan term is when the balance must be repaid. A shorter term can leave a large balance due, often called a balloon. Check both.
What does cap rate tell me?
Cap rate is annual NOI divided by price, shown as a percentage. It compares property income before financing. It doesn’t include your loan, future repairs or future selling price, so it isn’t your total return.
What if I don’t know the rate or all the expenses yet?
Label them as assumptions and compare a range. The calculator’s starting rate is illustrative, not current lender pricing. Replace it with a verified quote, add missing costs and review the result before relying on it.
Start with a property. Bring the questions.
Use the calculator freely. Choose to share an editable summary when you’re ready for a review.
Sources & planning limits
Educational guidance informed by the OCC commercial real estate lending handbook and SBA 7(a) / 504 guidance, reviewed September 26, 2026. Lender definitions and property requirements vary. Estimates are not an appraisal, investment recommendation, approval, rate quote or commitment to lend. California only.