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Loan Extension Fee Calculator

Bridge and construction loans often have extension options. This calculator computes fee, rate bump, and effective cost of the extension.

$
%

Total extension cost

$50,000

Extension fee

$25,000

Rate bump cost

$25,000

How the math works

Extension cost = upfront fee + rate bump × months. Both pile onto the same asset, so double-check loan docs for covenant conditions to exercise.

If covenants (DSCR, LTV, DY) aren't met, extension right may lapse — pushing the deal to maturity default or distressed sale. Covenant compliance is the real gatekeeper, not the fee.

How to Use

  1. Enter loan balance.
  2. Enter extension fee %.
  3. Enter rate bump.
  4. Enter extension length (months).
  5. Read total cost of extending.

Frequently Asked Questions

Typical fees?

Bridge: 0.25%-1.00% of loan for 6-12 month extension, plus 25-100bps rate bump. Construction: 0.50%-1.00% plus 50bps rate. Fee may be structured as option exercise + renewal. Read the loan doc carefully.

Is extension automatic?

No — usually conditional on DSCR, LTV, occupancy covenants being met at time of exercise. Miss the covenant = no extension right = loan matures. That's maturity default risk.

Better to refi?

If rates are higher, extending at a modest bump may be cheaper than full refi with new origination + third-party costs. If rates lower, refi wins.

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