.dscr-calculator-container {
font-family: 'Segoe UI', Tahoma, Geneva, Verdana, sans-serif;
max-width: 800px;
margin: 0 auto;
background: #ffffff;
padding: 30px;
border-radius: 8px;
box-shadow: 0 4px 15px rgba(0,0,0,0.1);
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.dscr-header {
text-align: center;
margin-bottom: 30px;
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.dscr-header h2 {
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@media (max-width: 600px) {
.dscr-input-grid {
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.dscr-final-score {
text-align: center;
margin-top: 20px;
padding: 15px;
border-radius: 4px;
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.dscr-good {
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What is the Debt Service Coverage Ratio (DSCR)?
The Debt Service Coverage Ratio (DSCR) is a critical financial metric used by real estate investors and lenders to evaluate the profitability of an investment property. Unlike standard mortgages that rely on your personal income (DTI), DSCR loans focus entirely on the property's ability to cover its own debts through rental income.
Specifically, the DSCR formula measures the relationship between a property's Net Operating Income (NOI) and its Total Debt Service (annual mortgage payments). A ratio greater than 1.0 indicates the property generates enough income to pay its debts, while a ratio below 1.0 signifies a negative cash flow.
How to Calculate DSCR
Our calculator uses the standard industry formula to determine your property's ratio:
DSCR = Net Operating Income (NOI) รท Total Debt Service
Step 1: Determine Gross Income
Combine your monthly rental income with any ancillary income sources, such as laundry fees, parking permits, or storage fees.
Step 2: Subtract Operating Expenses
To find the Net Operating Income (NOI), subtract all operating costs from the gross income. This includes property taxes, insurance, HOA fees, property management, and maintenance reserves. Note: Do not subtract the mortgage payment here.
Step 3: Divide by Debt Service
Finally, divide the monthly NOI by your monthly mortgage payment (Principal and Interest). The resulting figure is your DSCR.
Interpreting Your DSCR Score
Lenders have specific thresholds when approving investment loans. Here is what your score means:
- DSCR < 1.00: The property is losing money. You will need to cover the mortgage shortfall from personal funds. Most lenders will reject this loan.
- DSCR = 1.00: Break-even point. Income exactly covers the debt. This is considered risky by lenders.
- DSCR 1.00 – 1.19: Positive cash flow, but tight. Some lenders may approve this with higher interest rates or larger down payments.
- DSCR > 1.20: Healthy cash flow. This is the industry standard target. Properties with a DSCR above 1.25 often qualify for the best interest rates and loan terms.
Why Real Estate Investors Use DSCR Loans
DSCR loans are popular because they do not require tax returns or proof of personal income. This allows investors to scale their portfolios based solely on the performance of the assets they are acquiring. By ensuring your property has a DSCR of 1.25 or higher, you ensure the asset is self-sustaining and attractive to financing partners.
function calculateDSCR() {
// 1. Get Input Values
var rent = document.getElementById('dscrGrossRent').value;
var other = document.getElementById('dscrOtherIncome').value;
var tax = document.getElementById('dscrPropTax').value;
var ins = document.getElementById('dscrInsurance').value;
var hoa = document.getElementById('dscrHOA').value;
var mgmt = document.getElementById('dscrMgmt').value;
var debt = document.getElementById('dscrDebtService').value;
// 2. Parse Floats and Handle Empty Strings
rent = rent === "" ? 0 : parseFloat(rent);
other = other === "" ? 0 : parseFloat(other);
tax = tax === "" ? 0 : parseFloat(tax);
ins = ins === "" ? 0 : parseFloat(ins);
hoa = hoa === "" ? 0 : parseFloat(hoa);
mgmt = mgmt === "" ? 0 : parseFloat(mgmt);
debt = debt === "" ? 0 : parseFloat(debt);
// 3. Validation
if (debt = 1.25) {
finalBlock.classList.add('dscr-good');
messageDiv.innerText = "Excellent: Lenders highly favor this ratio.";
ratioSpan.innerText += " (PASS)";
} else if (dscrRatio >= 1.00) {
finalBlock.classList.add('dscr-warning');
messageDiv.innerText = "Acceptable: Cash flow is positive but tight.";
ratioSpan.innerText += " (CAUTION)";
} else {
finalBlock.classList.add('dscr-bad');
messageDiv.innerText = "Poor: Income does not cover debt.";
ratioSpan.innerText += " (FAIL)";
}
// Scroll to results
resultsDiv.scrollIntoView({behavior: 'smooth'});
}