Takeout Commitment Fee Calculator

Forward takeout commitments lock in permanent financing that replaces a construction or bridge loan at stabilization. Lenders charge upfront commitment fees (0.5-1.5%) and monthly standby fees until closing. This calculator sums the total cost to secure a commitment over the lockout period.

Takeout loan commitment

Commitment fee %

Good faith deposit

Lockout months

Monthly standby rate

Total cost to secure commitment

$470,000

Upfront commitment fee

$200,000

Total standby fees over lockout

$270,000

Monthly standby

$30,000

All-in fees as % of loan

2.350%

How the math works

Takeout commitments (forward loan commitments) reserve permanent financing that takes out a construction or bridge loan. Borrower pays a commitment fee (0.5-1.5%) at issuance plus monthly standby fees during the lockout. Good-faith deposit is typically credited against fees at closing.

Forward commitments lock in rate and loan economics for 6-24 months — great hedge against rate rise, expensive if rates fall and you want to walk. Most allow re-negotiation with a fee or fee recapture clause.

How to Use

Enter takeout loan amount and commitment fee %.
Enter good-faith deposit, lockout months, and monthly standby %.
Read total cost to secure the commitment.

Frequently Asked Questions

Why pay for a commitment?

Locks in rate and terms when you sign. If rates rise 100 bps during your construction period, the commitment saves you 1% per year on the permanent loan — typically worth paying 50-150 bps upfront.

Is fee refundable?

Partially — typically good-faith deposit is credited at closing but the commitment fee itself is non-refundable if you walk. Some lenders allow swap to another loan with a lower re-commitment fee.

Standby fees taxable at deduction?

Usually deductible as financing costs — amortized over life of loan after close. Pre-close standby can sometimes be expensed. Always consult tax adviser.