DSCR calculator
DSCR — debt service coverage ratio — shows how comfortably the rent covers the mortgage. Lenders for investment properties, especially DSCR loans, decide on it.
Formula
DSCR = yearly net operating income ÷ yearly mortgage payments
1.00 means the rent just covers the loan. Above 1 is a cushion; below 1 the property can't carry its debt.
Example: NOI of $22,800 a year against $17,400 of mortgage payments gives a DSCR of 1.31 — enough for most DSCR lenders.
Quick check
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DSCR
1.31
Verdict
Looks like a good deal
Rent covers every cost with money left over each month.
- Cash flow
- $445/mo
- Cap rate
- 8.14%
- DSCR
- 1.31
Quick estimate with typical costs: property tax 1.2%/yr, insurance 0.5%/yr, 5% vacancy, 10% of rent for repairs, 30-yr loan. The full analysis uses your real numbers, adds a stress test and an AI report.
What counts as good?
Under 1.00
Rent doesn't cover the mortgage. Most lenders decline.
1.00–1.20
Thin. Some lenders approve at a higher rate or bigger down payment.
1.25+
What most DSCR lenders want to see.
1.50+
Comfortable cushion against vacancies and rate rises.
Questions investors ask
What DSCR do lenders require?
Most DSCR and investment-property lenders look for 1.20–1.25 or higher. Some go down to 1.0 with stricter terms.
How do I improve a low DSCR?
Put more money down, negotiate the price, buy down the rate, or find a property with higher rent relative to price.
Is DSCR the same as cash flow?
No. DSCR is a ratio of income to the mortgage; cash flow is the dollars left over. A deal can have a DSCR above 1 but still thin cash flow once repairs are counted.
Need the full picture?
Your real costs, closing and rehab, a ⚡ stress test and an AI investment report.
More calculators: Rental property · Cap rate · Cash-on-cash return