Business Debt Restructure Calculator NZ 2026/27
A business carrying debt it can no longer service comfortably has a small number of real options, and all of them involve the same trade: paying less each month in exchange for paying more in total. This calculator makes both halves of that trade visible at once. You enter the facilities you actually hold, each with its balance, rate and years remaining, and the page totals them into the single monthly figure the business is struggling to find. You then model the change, whether that is consolidating everything into one facility at a new rate and term, stretching the term, moving to interest only for a period, or refinancing with fees capitalised so no cash is needed up front. The output is deliberately blunt: the cash freed each month, the extra interest that relief costs over the full term, the break-even month at which the accumulated relief equals the extra cost, and the debt service coverage ratio before and after. Restructuring is a legitimate and often sensible thing to do, particularly where short expensive facilities were used to fund long-lived assets, but it is a cash flow instrument rather than a saving, and the page is built so that nobody can mistake one for the other.
Current interest = the sum of (repayment × months remaining) less the balance, across every facility.
Consolidation adds the balances, adds any fees if you capitalise them, and amortises the total at the new rate over the new term.
Interest only charges interest alone on the consolidated balance for the chosen period, then amortises the full balance over the remaining term.
Total cost of the new facility = total paid less the original balances. Capitalised fees are therefore counted once, in full, along with the interest charged on them.
Extra interest = new total cost less current total interest. A negative figure means the restructure genuinely saves money, which happens when expensive short facilities are refinanced at a much lower rate without extending far.
Break-even months = extra interest / monthly cash freed. It answers how long the relief must be useful for to justify its price.
DSCR = EBITDA / annual debt service, before and after.
Assumptions: constant rates, no early repayment, no break costs on fixed facilities. Break costs can be significant and are not modelled; ask your lender for a figure before committing.
Not financial advice. Last verified: .
What you are paying now
| Facility | Balance | Rate | Years left | Monthly | Interest left |
|---|---|---|---|---|---|
| Facility 1 | $180,000.00 | 9.2% | 6 | $3,262.49 | $54,899.47 |
| Facility 2 | $85,000.00 | 11.5% | 3 | $2,802.96 | $15,906.58 |
| Facility 3 | $45,000.00 | 14.9% | 2 | $2,179.76 | $7,314.28 |
| Total now | $310,000.00 | $8,245.21 | $78,120.33 |
What the restructure does
| Balances consolidated | $310,000.00 |
| Plus fees capitalised | $3,500.00 |
| New facility balance | $313,500.00 |
| New repayment at 9.5% over 10 years | $4,056.61 |
| Monthly cash freed | $4,188.60 |
| Freed over the first 12 months | $50,263.22 |
What the relief costs
| Interest remaining on current facilities | $78,120.33 |
| Interest and fees on the new facility | $176,793.61 |
| Extra cost of the restructure | $98,673.28 |
| Break-even, in months of freed cash | 23.6 |
| Debt service coverage before | 1.21 |
| Debt service coverage after | 2.47 |
The debt has not reduced by a dollar. Only its shape has changed, which is exactly why the coverage ratio improves while the total cost rises.
Restructuring Buys Time, And Time Has A Price
Every restructure on this page does the same thing: it moves debt further into the future so that less of it has to be paid this month. That is genuinely valuable when a business needs to get through a period, and it is not something to feel bad about. It is also never free, and the size of the price is usually a surprise.
On the worked example the relief is $4,188.60 a month, which is close to half the current repayment. The price is $98,673.28 of extra interest and fees. Both numbers are real and both should be on the table when the decision is made.
Worked Example: Three Facilities Into One
The business holds a $180,000.00 term loan at 9.2% with six years to run, $85,000.00 of equipment finance at 11.5% over three years, and a $45,000.00 trade facility at 14.9% over two. Together that is $310,000.00 of debt costing $8,245.21 a month, with $78,120.33 of interest still to pay.
Consolidating into a single facility at 9.5% over ten years, with $3,500.00 of fees capitalised, gives a new balance of $313,500.00 and a repayment of $4,056.61.
Note what happened to the rate. The new 9.5% is lower than two of the three facilities it replaced. Total interest and fees still rise from $78,120.33 to $176,793.61, because the driver is not the rate, it is the term. The equipment finance had three years to run and now has ten.
The Break-Even Month Is The Real Test
$98,673.28 of extra cost divided by $4,188.60 of monthly relief gives 23.6 months. That is the honest test of whether this restructure is a good idea.
If the freed cash is doing something specific within about two years, funding a piece of equipment that lifts capacity, rebuilding a cash buffer, carrying the business through a known trough, then the restructure has paid for itself and the remaining interest is the cost of a decision that worked.
If, twenty-four months from now, the cash has quietly absorbed into ordinary trading and nothing structural has changed, the business has spent $98,673.28 to arrive at the same position with a longer loan and fewer options. That is the outcome worth guarding against, and the way to guard against it is to write down what the cash is for before signing.
Coverage Improves Without The Debt Changing
Debt service coverage on the current structure is $120,000.00 of EBITDA against $98,942.52 of annual service, which is 1.21. Most lenders want to see at least 1.25, so the business is technically below covenant on a common benchmark.
After the restructure, service falls to $48,679.32 and the ratio rises to 2.47. That is a dramatic improvement and it is entirely real: the business genuinely does have more headroom each month.
It is also worth being clear-eyed about what did not happen. The business owes exactly what it owed before, $310,000.00, plus fees. Nothing was repaid. A coverage ratio that doubles because the term was extended is a different thing from one that doubles because earnings grew, and a lender will read it that way too. Our Debt Service Coverage Ratio Calculator covers the measure in more detail.
When Restructuring Is Simply Correct
There is one case where this is not a trade at all but a straightforward fix: when short facilities were used to fund long-lived assets.
Equipment finance over three years on a machine with a twelve year working life is a mismatch. The business pays for the asset three times faster than it earns from it, and the resulting cash strain has nothing to do with whether the business is profitable. Refinancing that balance over a term closer to the asset's life is not deferring a problem, it is correcting a structuring error, and the extra interest is the fair cost of having borrowed correctly in the first place.
The opposite case is the warning sign. Where the freed cash funds ordinary running costs, and particularly where this is the second or third restructure, the constraint is not the lending. Our Minimum Price Calculator and Business Stress Test Calculator address that version of the problem, and no facility restructure will.
Before You Commit
Ask the lender for break costs in writing on any fixed facility being repaid early, since they are not modelled here and can be substantial. Confirm what security is being taken over the consolidated facility, because consolidating several small facilities frequently converts a set of specific charges into one general security agreement plus a personal guarantee. And check whether the new facility can be repaid early without penalty, which is what lets you shorten the term again once the pressure lifts. That last point matters more than it sounds: a ten year facility repaid in six costs far less than the figures on this page, but only if the terms allow it.
Related NZ Business Debt Calculators
- Business Loan Structure Calculator: the same structures compared on new borrowing.
- Debt Consolidation Calculator: consolidation for personal rather than business debt.
- Debt Service Coverage Ratio Calculator: the covenant most lenders test.
- Company Solvency Test Calculator: the directors' test under the Companies Act.
- IRD Instalment Arrangement Calculator: restructuring tax debt specifically.
Related calculators
- Business Health Check Calculator NZ 2026/27: enter your P and L and balance sheet for a scored read across profitab.
- Business Loan Repayment Calculator NZ 2026: Monthly Payments and Cost.
- Business Loan Structure Calculator NZ 2026/27: compare table P and I, interest-only then P and I, revolving credit an.
- Business Sale Proceeds Calculator NZ 2026/27: sale price less bank debt, broker and legal fees, plus shareholder cur.
How to model a business debt restructure
- List every facility you currently hold. Balance, interest rate and years remaining for each. Short expensive facilities such as equipment finance and overdrafts matter most, because they carry the highest repayments relative to their size.
- Total the current position. The calculator adds the repayments into one monthly figure and the interest into one lifetime figure. That combined monthly number is what the business is actually struggling to find.
- Choose the restructure. Consolidate everything into one facility at a new rate and term, or model an interest only period on the combined balance. Include any establishment, legal or break fees.
- Read the cash freed. The fall in the monthly repayment is the relief the restructure delivers. This is the number that decides whether the business survives the next twelve months.
- Read the extra interest. Stretching the same debt over more years almost always costs more in total. The calculator shows the full extra cost including capitalised fees, which is the price of the relief.
- Find the break-even month. Divide the extra interest by the monthly cash freed. That is how long the relief takes to be worth what it costs. Beyond that point the restructure is costing more than it gave.