DSCR Loan Calculator
Estimate NOI-based debt coverage, minimum rent thresholds, and loan-payment scenarios. This calculator does not determine loan approval.
DSCR Underwriting Formula & Benchmarks
Where Annual Debt Service = Total Principal & Interest payments per year
This tool uses NOI divided by principal-and-interest payments. Some residential programs instead use qualifying rent divided by PITIA (principal, interest, taxes, insurance, and association dues). Visio Lending explains that alternative. Confirm your lender’s method; do not interpret these bands as eligibility decisions.
Modeled NOI is at least 25% above principal-and-interest debt service. This is an income cushion, not an approval or rate quote.
Modeled NOI covers debt service with a smaller cushion. Vacancy and unexpected costs can reduce that coverage.
Modeled NOI falls short of debt service. Revisit expenses, financing, and reserves before deciding whether the deal fits.
State-Aware Property Economics
Haven models state-specific property taxes (e.g. 1.80% in TX vs 0.75% in CA) and regional hazard insurance to calculate realistic NOI.
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Frequently Asked Questions About DSCR
What is DSCR in real estate lending?
DSCR (Debt Service Coverage Ratio) is the ratio of a property's Net Operating Income (NOI) to its annual debt obligations (Principal and Interest mortgage payments). It measures the property's ability to pay for its own financing without personal borrower income.
What is a good DSCR ratio for a rental loan?
A higher ratio provides more income coverage in the model. Actual lender minimums, LTV, reserves, and pricing vary by program. Confirm both the required ratio and its calculation method with your lender.
How is DSCR calculated?
DSCR = Net Operating Income (NOI) ÷ Total Debt Service. For example, if a property produces $30,000 annual NOI and annual mortgage payments total $24,000, the DSCR is $30,000 ÷ $24,000 = 1.25x.
Do DSCR loans require tax returns or W-2s?
Some investor loan programs emphasize rental income instead of traditional employment-income documentation. Credit, reserves, property eligibility, and other documentation requirements still vary by lender.
Can I get a DSCR loan if my ratio is under 1.0?
Availability and eligibility depend on the lender and loan program. Below 1.0 in this NOI-based model, operating income does not cover the entered debt service. The calculator cannot determine whether a lender will approve a loan.
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