Real Estate Term

DSCR

Debt Service Coverage Ratio — NOI divided by annual debt service.

Reviewed 9 August 2026 by Keiron Brown, Founder & Editor, CalculateRealEstateROI · Educational estimates only — not investment, financial, tax, or legal advice

Explanation

Lenders typically require 1.20–1.25 minimum on DSCR loans. Higher DSCR = more cushion against rent decline.

Formula

DSCR = NOI ÷ Annual Debt Service

Example

$30k NOI / $24k debt service = 1.25 DSCR.