What happens when a commercial real estate loan matures—but the property cannot support the same loan amount anymore? That difference is called the refinance gap.

This article walks through why a borrower might want to prepay a commercial real estate (CRE) loan, how a yield maintenance clause changes the math for both borrower and lender, and the economic logic behind it using the attached model.

Recently, I used v0 by Vercel to build a CRE Loan Sizing application that turns lending assumptions into loan proceeds, constraint checks, and decision metrics. This article walks through the full build lifecycle—from writing the initial prompt and approving v0’s plan to reviewing formulas, refining the interface, testing outputs, and publishing the finished app—plus the actual unedited prompt used to create it for easy reference.

Technical guide to how lenders size CRE loans using LTV, DSCR, debt yield and mortgage constants, illustrated through a full Excel-based case study. The article walks step-by-step from NOI and value to constrained loan amount, shows how each metric produces a different max loan, identifies the binding constraint, and then recomputes all credit metrics at a custom, business‑plan‑driven loan amount.