FREE DEBT CALCULATOR
Interest Reserve Calculator
Estimate construction interest reserve from facility size, draw profile, rate and duration.
INDICATIVE RESULT
€700,000Average drawn balance€5,000,000
Monthly average interest€29,167
Calculated directly from the assumptions shown.
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How the interest reserve calculation works
Reserve ≈ facility × average utilization × annual rate × months ÷ 12.
Example calculation
A €10m facility at 50% average utilization, 7% annual interest and 24 months implies about €700k of interest.
INVESTMENT USE
How professionals use the result
Use this as a screening estimate. Monthly draw timing and capitalized interest can create circularity in a full model.
Common mistakes
- Applying interest to the full facility
- Ignoring draw timing
- Compounding without stating it
- Including the reserve in the base twice
CLEAR ANSWERS