About this DSCR Calculator
DSCR measures how much net operating income is available to cover annual debt service. Lenders and investors use it to evaluate debt coverage, but thresholds depend on the loan program and risk profile.
Who this calculator is for
- Real estate investors comparing rental property scenarios.
- Landlords pressure-testing income, expense, and financing assumptions.
- Buyers and advisors who want transparent investment math from user-entered numbers.
When to use it
- Estimate coverage before discussing financing terms.
- Compare debt service scenarios using your own NOI assumptions.
- Check how expense or rent changes affect loan coverage.
How to use this calculator
- Enter annual income, vacancy loss, and operating expenses.
- Enter annual debt service for the loan scenario you want to test.
- Review the DSCR and debt service cushion.
- Run alternate scenarios for rent, expenses, or loan payments.
Key assumptions
- Annual debt service is user-entered and should come from the actual loan scenario being tested.
- NOI excludes debt service, income taxes, depreciation, and owner-specific financing costs.
- All rents, expenses, rates, debt service, costs, appreciation, reserves, and investment amounts are entered by the user.
- Calculations run locally in your browser and are not stored by Calwarden.
- Results are estimates for planning and comparison only, not financial, tax, legal, lending, appraisal, or investment advice.
Accuracy and testing
Review formula sources, default test cases, assumptions, unit handling, rounding rules, and changelog for this calculator.
How this calculator works
Inputs explained
NOI inputs
Income, vacancy loss, and operating expenses determine the annual net operating income before financing.
Annual debt service
Total yearly principal and interest payments for the debt being tested.
Debt coverage
DSCR compares the income available before debt with the annual loan payment obligation.
Understanding your results
Example scenarios
Covered loan scenario
$29,500 NOI divided by $21,600 annual debt service gives a DSCR of about 1.37.
Coverage shortfall
If NOI is $20,000 and annual debt service is $24,000, DSCR is 0.83, meaning NOI is below the debt service assumption.
Key Features
- Instant Calculation
- Private & Secure
- Mobile Optimized
Tips & Best Practices
- Use lender-specific underwriting rules separately; this tool only performs the arithmetic.
- Stress-test vacancy and expenses to see how quickly DSCR changes.
- Compare DSCR with cash-on-cash return because lender coverage and investor return answer different questions.
Glossary of Terms
- NOI
- Net operating income. Rental and other operating income minus vacancy loss and operating expenses, before debt service and income taxes.
- Debt service
- Principal and interest payments on financing. These are excluded from NOI but included in cash flow and DSCR analysis.
- Cash invested
- Cash contributed to acquire and prepare the property, such as down payment, closing costs, initial repairs, and other upfront costs.