DSCR Loan Calculator
Calculate your Debt Service Coverage Ratio to assess loan qualification and financial health
What is DSCR?
The Debt Service Coverage Ratio measures your ability to service debt payments with your net operating income. A higher ratio indicates better financial health and loan qualification potential.
How to Calculate DSCR
Our debt service coverage ratio calculator uses the following formula:
Net Operating Income (NOI) = Rental Income + Other Income – Property Expenses
Total Debt Service = Monthly Mortgage Payment (PITIA)
Minimum Acceptable DSCR
Most lenders want a minimum ratio of 1:1, but some will do no ratio. No ratio means that they do not care if the gross rental income is greater than the total housing payment.
If your property doesn’t ratio, it is riskier to the bank, so the interest rate and upfront fees will be higher. The better the ratio, the better the terms your property will qualify for.
What is a 1.25 DSCR?
A 1.25 DSCR means that the income from your property will be able to cover the total debt service related to your property and have enough left over for an income for you.
1:1 exactly represents the amount needed to cover the loan, while 0.25 represents the amount that is left over.
Example:
If your total housing payment (PITIA) is $1,000 and your gross monthly income is $1,250, your DSCR would be 1.25.
$1,250 ÷ $1,000 = 1.25 DSCR
DSCR Ranges & Loan Terms
Best interest rates and loan terms available
Competitive rates with favorable terms
Standard rates, may require additional documentation
Higher rates and fees, limited lender options
What is a DSCR Loan?
A Debt Service Coverage Ratio (DSCR) loan is a type of investment property financing where lenders qualify you based on the property’s rental income rather than your personal income. These loans are perfect for real estate investors who want to expand their portfolio without traditional income verification.
✓ No Income Verification – Qualify based on property cash flow, not personal income
✓ Fast Approval – Streamlined process with fewer documentation requirements
✓ Scale Your Portfolio – Purchase multiple properties without income limitations
How to Use This Calculator
Simply enter your property’s financial details above. The calculator will instantly show your DSCR ratio and whether you qualify for favorable loan terms. A DSCR of 1.25 or higher typically qualifies for the best rates and terms.