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DSCR Calculator

Inherited a rental property with a mortgage? The Debt Service Coverage Ratio (DSCR) determines if the property generates enough income to cover its debts. Lenders usually want a DSCR of 1.25 or higher to refinance.

Gross rent minus operating expenses (taxes, insurance, maintenance). Do not subtract the mortgage payment here.

Total principal and interest payments for the year.

Debt Service Coverage Ratio

Healthy. Commercial lenders will generally approve a refinance. Marginal. The property pays for itself, but leaves little margin for error. Lenders may reject a cash-out refi. Negative Cash Flow. The property does not generate enough income to pay its mortgage. You are bleeding money.