Finance category
Mortgage, loan, investing, tax, and money calculators.
Interest Only Extension Economics Calculator
IO extensions trade principal paydown for cash flow.
Cash flow savings
$865,808
Annual savings
$432,904
Foregone principal
$865,808
How the math works
Monthly savings = P&I − IO payment. Annual × extension years = total cash flow savings.
$25M loan: P&I $160k vs IO $125k monthly. $35k × 12 = $420k/yr × 2 yr = $840k cash flow savings.
How to Use
- Enter loan balance.
- Enter rate %.
- Enter amortization period years.
- Enter extension years.
- Read IO cash flow savings.
Frequently Asked Questions
IO economics?
IO payments = balance × rate. Full P&I payment higher. Difference = principal paid down. IO extension foregoes principal paydown for current cash flow. Lenders typically charge 25-100 bps premium for IO periods.
When does IO help?
Value-add projects: use IO cash flow to fund CapEx and TI. Stabilization period: ease DSCR pressure. Acquisition: defer amort to build rent. Development: no debt service while building. Refinance intended at IO end.
Structural risks?
Balloon payment at maturity. If unable to refi, face default. IO extension delays amortization — if sold later, remaining balance higher. Model refinance assumption carefully; don't rely on extending indefinitely.
How often should I rerun this?
Rerun this calculator whenever inputs change materially — new rent roll data, rate moves, loan balance updates, or quarterly operating data. For active deals, monthly refresh is typical. For stabilized assets under monitoring, quarterly is fine. Treat the output as a decision tool, not a one-time answer — market conditions evolve and so should your analysis.
Related Calculators
More Finance Calculators
Browse all finance →AI Cost Calculator
Compare token costs across OpenAI, Anthropic, and Google AI models. Calculate monthly API spending for GPT-4o, Claude, Gemini, and more.
Tip Calculator
Calculate the perfect tip and split the bill between friends. Choose preset percentages or enter a custom tip amount.
Bill Splitter Calculator
Split an uneven restaurant bill by item, divide tax and tip proportionally, and see exactly who owes whom.
Discount Calculator
Calculate sale price, discount amount, stacked discounts, sales tax, and total savings for any markdown.
Gas Mileage Calculator
Calculate MPG or km/L, estimate trip fuel cost, and compare annual fuel expenses between two vehicles.
Sales Tax Calculator
Add sales tax to a price, reverse-calculate the pre-tax amount from a total, and estimate tax for multiple items on one receipt.
Keep exploring