DSCR Calculator: Debt Service Coverage Ratio
Last updated: August 2026
Use this free DSCR calculator to see whether a rental property covers its own debt. Most lenders want 1.20 or better — income exceeding the payment by twenty percent. Enter your figures below for your ratio, or use the lookup chart to find a common rent and payment combination.
Quick DSCR calculation
If you already know your net operating income and annual debt service, this is the whole calculation.
DSCR lookup chart
Monthly rent across the top, monthly payment down the side. Assumes net operating income of 75% of gross rent, which is a common shorthand for a single-family rental. Green clears the usual 1.20 threshold, amber is thin, red fails.
| Payment ↓ / Rent → | $1,200 | $1,500 | $1,800 | $2,100 | $2,400 | $2,700 | $3,000 | $3,500 | $4,000 |
|---|---|---|---|---|---|---|---|---|---|
| $900 | 1.00 | 1.25 | 1.50 | 1.75 | 2.00 | 2.25 | 2.50 | 2.92 | 3.33 |
| $1,200 | 0.75 | 0.94 | 1.13 | 1.31 | 1.50 | 1.69 | 1.88 | 2.19 | 2.50 |
| $1,500 | 0.60 | 0.75 | 0.90 | 1.05 | 1.20 | 1.35 | 1.50 | 1.75 | 2.00 |
| $1,800 | 0.50 | 0.63 | 0.75 | 0.88 | 1.00 | 1.13 | 1.25 | 1.46 | 1.67 |
| $2,100 | 0.43 | 0.54 | 0.64 | 0.75 | 0.86 | 0.96 | 1.07 | 1.25 | 1.43 |
| $2,400 | 0.38 | 0.47 | 0.56 | 0.66 | 0.75 | 0.84 | 0.94 | 1.09 | 1.25 |
| $2,800 | 0.32 | 0.40 | 0.48 | 0.56 | 0.64 | 0.72 | 0.80 | 0.94 | 1.07 |
Formula: Net operating income ÷ annual debt service = DSCR. On $2,400 monthly rent with a $1,800 payment: NOI of $1,800 a month against a $1,800 payment gives 1.00 — it covers the payment and nothing more.
Full DSCR calculator
Build net operating income from the actual expenses and size the loan properly. This also shows the largest loan that would still clear 1.20, which is frequently the number that constrains a purchase rather than the loan-to-value limit.
- Gross scheduled rent
- $29,400
- Less vacancy
- −$1,764
- Collected rent
- $27,636
- Less operating expenses
- −$11,287
- Net operating income
- $16,349
- Monthly payment
- $1,573
- Annual debt service
- $18,879
Estimates only. Lenders use their own definitions of income and debt service, order their own appraisal and rent schedule, and apply their own thresholds.
What lenders require
| DSCR | What it means | Typical lender view |
|---|---|---|
| Below 1.00 | Income does not cover the payment | Generally declined, or higher rate and lower LTV |
| 1.00–1.15 | Covers it, little margin | Accepted by some, priced up |
| 1.20–1.25 | The common threshold | Standard terms |
| 1.35 and above | Comfortable coverage | Best pricing |
The definition is not standardised
This matters more than it sounds, and it is why quotes from different lenders are not directly comparable.
| Variable | Conservative lender | Lenient lender |
|---|---|---|
| Income used | Net operating income | Gross rent |
| Rent source | Lower of lease or market | Market rent schedule |
| Debt service | PITIA, including taxes and insurance | Principal and interest only |
| Vacancy | Deducted | Ignored |
The same property can produce a 1.05 at one lender and a 1.35 at another, with nothing about the building changing. Ask each lender which definition they use before comparing rates.
If your DSCR is too low
Increase the down payment. A smaller loan means a smaller payment and a higher ratio. The most reliable fix, and it uses capital.
Extend the amortisation. A forty-year term or an interest-only period reduces the payment. Interest-only can move a 1.05 well above 1.20 — and builds no equity, which is a real trade rather than a trick.
Buy down the rate. Points reduce the payment. Model whether they cost less than the extra down payment would.
Document the rent accurately. A market rent schedule reflecting the property's true rental value, where a below-market legacy tenancy is dragging the figure down. Documenting, not inflating — lenders order their own schedule.
What does not work is presenting optimistic expenses. Lenders using NOI apply their own assumptions, and a schedule with no vacancy and no management gets adjusted.
What the ratio does not tell you
A 1.20 DSCR means the property covers its payment with 20% to spare, at the rent assumed on the day of underwriting.
It does not survive a vacancy. Two months empty consumes the annual margin entirely, and the payment continues.
It does not include capital expenditure. A roof or a furnace is not in NOI and is not in the ratio.
It does not include an eviction. Six to eight weeks of a non-paying tenant in a slower state, plus turnover, exceeds the buffer.
A lender lending at 1.20 is protecting themselves.Their downside is foreclosing on an asset worth more than the loan. Yours is funding the payment from your own money. Your own test should be stricter than theirs.