Test whether income covers debt payments.
Please do not make financial decisions based on these results.
What is the Debt Service Coverage Ratio Calculator (DSCR)?
Test whether income covers debt payments. To use the Debt Service Coverage Ratio Calculator (DSCR), enter net operating income, annual debt service; it returns dscr, cash left after debt service, and shows them instantly as you type.
Pricing bonds and testing credit
Price a bond with the Bond Price Calculator, solve for yield with the Bond YTM Calculator and measure rate risk with convexity and duration. If the bond is callable, compare yield to maturity with the yield to call.
On the credit side, combine Debt to Equity Calculator, interest coverage and the Altman Z-score. Together they show leverage, ability to pay and the odds of distress.
- Yields. Current yield, YTM, yield to call and bond-equivalent yield answer different questions.
- Coverage. DSCR, times interest earned and cash flow to debt show repayment capacity.
- Loss. LGD and credit spread translate risk into expected loss and extra yield.
How to use the Debt Service Coverage Ratio Calculator (DSCR)
- Enter your numbers. Start with Net operating income ($), Annual debt service ($). Take the price, coupon and maturity from the bond’s listing. Fields marked optional can stay at zero.
- Read the result. The highlighted box gives the DSCR, and the cards below show Cash left after debt service. Tables and charts break it down further.
- Test other scenarios. Results update as you type. Change one value at a time to see what drives the answer, and press Reset to go back to the defaults.
Formula and how it works
Example with real numbers
Here is the Debt Service Coverage Ratio Calculator (DSCR) using the default values shown in the calculator above:
Inputs
| Net operating income ($) | 180,000 |
|---|---|
| Annual debt service ($) | 130,000 |
Results
| DSCR | 1.38 |
|---|---|
| Cash left after debt service | $50,000.00 |
With these inputs the calculator returns DSCR: 1.38. Change any value in the calculator to see how the result moves.
What if you change one input?
Sensitivity check: raising Net operating income ($) from 180,000 to 216,000 (about 20% higher) and leaving everything else as in the example above changes the results like this:
| Result | Example | After the change | Change |
|---|---|---|---|
| DSCR | 1.38 | 1.66 | +20% |
| Cash left after debt service | $50,000.00 | $86,000.00 | +72% |
The input that moves the result most is the one to check twice. Change it in the calculator above to test your own case.
What the results tell you
The results panel of the Debt Service Coverage Ratio Calculator (DSCR) reports DSCR and cash left after debt service. Compare these figures while changing one input at a time, and use the related calculators below to look at the same situation from another angle.
Method and limits. This calculator applies the formula in the section above to your inputs, in your browser; nothing you enter is stored on our servers. The result is only as accurate as the numbers you enter and the formula shown above. It is for information, not financial, tax or legal advice.
Frequently asked questions
What DSCR do lenders want?
Most commercial lenders require at least 1.20 to 1.25.
Why do bond prices fall when rates rise?
New bonds pay the higher rate, so older, lower-coupon bonds must sell at a discount to match the market yield.
What interest coverage is safe?
Above about 3 times is comfortable; below 1.5 times signals stress.
Are the results guaranteed?
No. Results depend entirely on the numbers you enter and the formulas shown on this page. Please do not make financial decisions based on them alone; confirm important figures with a licensed professional.
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