DSCR Calculator — Adam J. Karol

Q: Why do lenders care so much about DSCR?

It's a direct measure of whether the property's own income can cover the loan payment, independent of the borrower's other income — the single number most commercial underwriting decisions hinge on.

Q: Can I improve my DSCR before applying?

Raising NOI (higher rents, lower vacancy, trimmed expenses) or putting more money down to shrink the loan are the two levers — both move DSCR in your favor.

Debt service coverage ratio is the number most commercial lenders check before almost anything else — see where a deal stands before you bring it to one.

Net Operating Income (annual)$Loan Amount$Interest Rate%Amortization Periodyears

1.55

DSCR

Strong — meets most lenders' minimums

$50,888

Annual debt service

Typical lender minimums (varies by lender and property type):

≥ 1.25 — strong, meets most conventional CRE lenders
1.00 – 1.25 — marginal, thin cushion
< 1.00 — NOI doesn't cover debt service

These calculators provide estimates for educational purposes only — they are not an appraisal, a loan quote, or tax advice. Real underwriting, valuation, and 1031 exchange outcomes depend on your specific deal, lender, and a qualified intermediary/CPA — treat these as a starting point for a conversation, not a final number.

Want a real read on a specific deal? Talk to me directly.

Frequently Asked

Why do lenders care so much about DSCR?+

It's a direct measure of whether the property's own income can cover the loan payment, independent of the borrower's other income — the single number most commercial underwriting decisions hinge on.

Can I improve my DSCR before applying?+

Raising NOI (higher rents, lower vacancy, trimmed expenses) or putting more money down to shrink the loan are the two levers — both move DSCR in your favor.