Amortization Schedule

An amortization schedule is a table showing the breakdown of each mortgage payment into principal and interest over the life of the loan, along with the remaining loan balance after each payment. In NNN investing, most commercial mortgages use 25-year amortization with a 5-10 year balloon term. This means payments are calculated as if the loan will be paid over 25 years, but the remaining balance comes due (the balloon payment) after 5-10 years, requiring refinancing or sale. Understanding amortization is critical for calculating DSCR, cash-on-cash returns, and planning for refinancing events. Longer amortization periods result in lower monthly payments but more interest paid over time.

Amortization Schedule is a key concept that affects property valuation, financing decisions, and investment returns in the triple net lease market. Understanding Amortization Schedule helps investors make informed acquisition and management decisions.

Amortization Schedule directly influences how commercial properties are valued, financed, and traded. Changes in Amortization Schedule can impact cap rates, NOI calculations, and overall investment performance for net lease properties.

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