Tool
DSCR Calculator
Calculate debt service coverage ratio for rental property loans.
Real Estate Calculators
What this tool does
Debt Service Coverage Ratio (DSCR) measures whether a property's NOI covers its annual loan payments. Lenders often require minimum DSCR thresholds for investment property loans.
How to use
- Enter net operating income (NOI).
- Enter total annual debt service (mortgage payments × 12).
- Review DSCR — values above 1.0 mean income covers debt.
Formula
DSCR = NOI ÷ annual debt service
Examples
Investment property loan
Input: NOI: $45,000, Debt service: $36,000
Output: DSCR: 1.25
Income exceeds debt service by 25%.
Assumptions
- Annual debt service includes principal and interest.
- Estimate only. Not financial advice.
Common use cases
- Qualify for DSCR investment loans
- Stress-test refinance scenarios
- Compare financing options
FAQ
What DSCR do lenders require?
Many DSCR loan programs target 1.0–1.25+ depending on product and market.
What if DSCR is below 1?
NOI does not fully cover debt service — the property requires additional cash to cover payments.
Should I use NOI or net cash flow?
DSCR typically uses NOI before owner draws and income taxes.
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Last reviewed: 2026-05-23