Free Tool
The DSCR Calculator
Debt-service coverage is the cushion between what a property earns and what it owes the bank — the number that decides whether a soft year means “wait” or “lose.” Enter the income and the loan, and see the coverage ratio. No sign-up required.
Income & debt
Debt-service coverage
Income for every dollar of loan payment. Lenders want a margin here; so should you.
Comfortable coverage.
A simplified model for education, assuming fixed, amortizing debt. Not investment advice.
Why coverage is a safety number, not a return number
Debt-service coverage is net operating income divided by the annual loan payment. At 1.40x, the property earns $1.40 for every $1 of mortgage — a 40% cushion before it can no longer cover the debt. At 1.25x the margin is thin; at 1.00x there is none, and any bad news is a capital call. It is the first number a lender checks, and it should be one of the first you check too.
We hold a conservative coverage floor on every deal, because the loan — not the building — is what usually sinks an apartment investment. Cheap, fixed-rate debt raises coverage; expensive or floating debt erodes it. DSCR, explained in full → · More free calculators →
Free Playbook
Put the safety numbers in your pocket.
Debt coverage is one idea from our free Playbook — the plain-English guide to evaluating an apartment deal, and the sponsor behind it, like an institution.