Tools
DSCR Calculator
Model the debt service coverage ratio on a rental property using the financing structure you are considering. The tool shows the full monthly obligation behind the ratio, not just the number.
Quick Answer
Debt service coverage ratio is a rental property's gross rent divided by its modeled housing obligation — principal, interest, taxes, insurance, and association dues. A ratio at or above 1.00 means rent covers the modeled payment; below that, the property carries a shortfall the borrower must absorb. Minimum DSCR thresholds, whether taxes and insurance are included, and pricing at each ratio band vary by program.
Property and financing
= $212,500
Income and carrying costs
Estimated DSCR
0.94
Modeled gross monthly rent divided by the modeled monthly housing obligation (0.938 unrounded).
Monthly obligation breakdown
- Principal & interest
- $4,348.87
- Property taxes
- $779.17
- Property insurance
- $200.00
- HOA
- $0.00
- Estimated PITIA
- $5,328.04
Monthly rent
$5,000
Estimated PITIA
$5,328
Rent minus obligation
-$328
Down payment
$212,500 (25.0%)
Reading the ratio
A DSCR of 1.00 means the modeled monthly rental income equals the modeled monthly housing obligation. Above 1.00 means modeled rent exceeds that obligation. Below 1.00 means modeled rent is below it.
DSCR calculation methodology and requirements vary by lender and program. Some use PITIA, some use principal and interest only, some apply market-rent adjustments, and minimum ratios differ.
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Assumptions used
- Fixed-rate amortizing payment for the term entered. Interest-only DSCR structures produce a different obligation and a different ratio.
- Gross rent is used, with no deduction for vacancy, management, maintenance, or capital expenditures. Your cash-flow analysis should account for those separately.
- Taxes are entered as an annual dollar amount rather than derived from the price, so reassessment after purchase is not modeled automatically.
- Example values are pre-filled for demonstration only and are not current market rates or rents.
Results are estimates for educational purposes only and are based on the information and assumptions entered. They are not a loan approval, commitment to lend, or rate quote. Actual loan terms, payments, eligibility, taxes, insurance, and other costs may differ.
This tool does not determine eligibility, approval, or program qualification for any borrower or property. A DSCR figure alone does not indicate that financing is available.
Cascada Mortgage Advisors, Inc. DBA HomeFlow (NMLS #2470941, CA DRE #02206556) is a licensed mortgage broker, not a direct lender. Any interest rate you enter is your own assumption, not a HomeFlow rate.
What this calculator does
It builds a monthly housing obligation for an investment property — principal and interest, property taxes, insurance, HOA, and any other recurring expense you choose to include — and divides gross monthly rent by that obligation to produce an estimated DSCR.
How the calculation works
Monthly principal and interest uses the standard fixed-rate amortization formula on the loan amount derived from price minus down payment. PITIA adds monthly taxes, monthly insurance, and HOA. Estimated DSCR = gross monthly rental income ÷ the monthly obligation used. The ratio is calculated at full precision and displayed rounded to two decimals — 1.136 displays as 1.14.
What the result means
A DSCR of 1.00 means the modeled monthly rental income equals the modeled monthly housing obligation. Above 1.00 means modeled rent exceeds that obligation. Below 1.00 means modeled rent is below it. That is the whole of what the ratio says. It is not a statement about cash flow after vacancy and maintenance, and it is not a statement about whether financing is available.
Important limitations
DSCR methodology varies by lender and program. Some use full PITIA, some use principal and interest only, some apply a market-rent analysis or take the lower of lease and market rent, and minimum ratios differ. Interest-only structures produce a different obligation and therefore a different ratio. Gross rent here excludes vacancy, management, maintenance, and capital expenditures, so it is not a cash-flow model.