Debt Service Coverage Ratio

What is DSCR (Debt Service Coverage Ratio)?

What is DSCR (Debt Service Coverage Ratio)?

DSCR is a metric used by lenders to determine loans on income-generating properties. It is the required cash flow for paying current debts (interest, principal, lease payments, etc.), plus a certain margin of safety. DSCR can be calculated by taking a property’s net operating income (NOI) and dividing it by the property’s annual debt service.