Retained vs Rolled Interest Calculator
Compare retained (deducted upfront) vs rolled (compounded) interest options for bridging loans. See how each affects your Day 1 cash and exit costs.
Retained | Rolled | |
|---|---|---|
| Gross loan | £200,000 | £200,000 |
| Net Day 1 Advance | £175,600 | £196,000 |
| Total interest | £20,400 | £21,381 |
| Gross Redemption | £202,000 | £223,381 |
| Total Cost of Finance | £28,900 | £29,881 |
Extra Day 1 with Rolled
+£20,400
Higher Exit with Rolled
+£21,381
Retained saves £981
Retained interest is cheaper overall, but you receive £20,400 less on Day 1. Choose retained if you have sufficient equity for your project.
66.7%
Loan to value
0.85%
Interest per month
£4,000
Deducted Day 1
£2,000
Paid on redemption
About the Retained vs Rolled Interest Calculator
What it does and how it helps you
The Retained vs Rolled Interest Calculator helps UK property investors compare bridging loan interest options. See exactly how retained interest (deducted upfront) compares to rolled interest (compounded monthly) for your Day 1 cash and exit costs.
How It Works
Understanding the calculation method
When taking a bridging loan, you have three interest payment options: Retained Interest: - Interest for the full term is calculated upfront - Deducted from your loan advance on Day 1 - You receive less cash initially but owe less at exit - No monthly payments during term - Lower total interest cost (simple interest, not compounded) Rolled Interest: - Interest compounds monthly during the term - Added to your loan balance each month - You receive maximum cash on Day 1 - No monthly payments during term - Higher total cost due to compounding effect Serviced Interest: - Interest paid monthly during the term - You receive maximum cash on Day 1 - Monthly payment obligation - Total interest cost between retained and rolled The calculator compares retained vs rolled options, showing the difference in Day 1 advance, redemption amount, and total cost. Most investors choose retained if they have sufficient equity, as it saves 10-15% on total interest cost.
When to use this calculator
Use this calculator when comparing bridging loan quotes or deciding which interest structure works best for your project. Essential when you need to maximize Day 1 cash (choose rolled) or minimize total finance cost (choose retained). Particularly useful when you're tight on equity and need to see if retained interest leaves you enough to complete your project.
Frequently Asked Questions
Common questions about this calculator