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DSCR Calculator

Pressure-test your loan against a lender's DSCR threshold. Enter NOI and annual debt service, we'll show your ratio and whether it clears typical underwriting standards.

DSCR

1.36x

→ Standard

Net operating income (annual)
USD / year

NOI = effective gross income − operating expenses (no mortgage).

Annual debt service
USD / year

All-in mortgage payments (P+I) over 12 months.

NOI
$60,000
Annual debt service
$44,000
Cushion (NOI − DS)
$16,000
Lender threshold
1.20x – 1.25x
How this is calculated

DSCR = NOI ÷ Annual debt service

A DSCR of 1.0x means NOI exactly covers the loan with zero buffer. Lenders typically want 1.20x or higher to absorb a bad quarter.

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We'll match your DSCR profile to the right lenders, structure terms that improve coverage, and pre-empt the underwriter's objections. Free 30-minute call.

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FAQ

Common questions

What DSCR do lenders require?

Most U.S. agency and bank lenders require a minimum DSCR of 1.20x–1.25x for stabilized commercial and multifamily loans. DSCR-loan products for SFR rentals typically need 1.0x–1.10x, though pricing improves materially above 1.25x.

Is 1.25 enough?

1.25x clears most lender hurdles, but it leaves a thin buffer. A single bad month, vacancy, repair, tax bill, can push you under. For LP-friendly deals or any rate-sensitive market, target 1.35x–1.45x at underwriting and pencil in a stress test at 90% NOI.

How is DSCR different from cap rate?

Cap rate is unleveraged: NOI ÷ price. DSCR is leveraged: NOI ÷ debt service. Cap rate tells you how the asset performs as an asset; DSCR tells you whether the loan works. A great cap rate at the wrong leverage can still bust the DSCR test.

Can I improve my DSCR?

Three levers: increase NOI (raise rents, cut expenses), reduce debt service (longer amortization, lower rate, smaller loan), or restructure the deal (interest-only period, recast). The fastest fix is usually a smaller loan, lenders care about the ratio, not your equity check size.
Need help interpreting your numbers?

Ready to run your loan past our underwriting team?

DSCR thresholds vary by lender, asset class, and market. We'll match your deal to the right capital source. Free 30-minute consult, no pitch deck, no commitment.