Tool
CMBS Defeasance Calculator
Most CMBS loans cannot simply be prepaid: exiting early usually means defeasance, purchasing government securities that replace your loan’s remaining cash flows. This tool estimates what that costs today.
Simplified estimate assuming interest-only payments to the open window and a single reinvestment yield. Actual defeasance prices a security-by-security schedule against your loan documents; when the reinvestment yield exceeds the note rate, the premium can be near zero or negative. Reinvestment yield default reflects the 10-year Treasury area, July 2026; adjust to current market.
How the estimate works
The calculator discounts your remaining interest payments and balloon at the reinvestment yield you enter, then compares that portfolio cost to your outstanding balance. The difference is the securities premium. When Treasury yields sit above your note rate, replacement securities are cheap and the premium shrinks; when yields sit below your note rate, defeasance gets expensive. Third-party costs (defeasance consultant, counsel, accountant, rating agency, servicer fees) typically add a fixed amount regardless of loan size, which is why defeasing small balances is proportionally costlier.
Before relying on any number, confirm in your loan documents whether your loan requires defeasance or permits yield maintenance, and when your open window begins. If you are weighing defeasance against holding to maturity, the desk runs this analysis against live securities pricing. Get a quote or call (561) 556-2121.
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