Debt Service Coverage Ratio Calculator

About this calculator

The Debt Service Coverage Ratio (DSCR) divides net operating income by total debt service (all principal and interest due on a loan over a period) to measure whether a property or business generates enough income to cover its debt payments. A DSCR of 1.0 means income exactly covers the debt payments with nothing left over; below 1.0 means the income is not enough on its own.

Commercial real estate and business lenders rely heavily on DSCR when underwriting a loan, and most require a minimum ratio — often somewhere around 1.20 to 1.25 — to leave a cushion for vacancies, maintenance surprises, or a downturn in revenue. This calculator takes net operating income and annual debt service and returns the DSCR along with a plain-language read on where that ratio falls relative to typical lender thresholds.