For rental investors
DSCR calculator
Work out a rental’s debt service coverage ratio: the rent divided by the full monthly payment, with principal and interest, taxes, insurance and association dues. It also shows the loan size the rent would support. It runs in your browser and nothing you type is sent to us.
Prefer to talk? Call 732-686-9999
- Direct, licensed mortgage lender
- NMLS #103098
- Equal Housing Lender
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Fidelity Residential · NMLS #103098 · Equal Housing Lender
Calculator
Work out the debt service coverage ratio
Enter the rent, the loan amount, the interest rate and term from your own quote, and the property’s taxes, insurance and dues. Every figure below is worked out from what you enter.
Everything here runs in your browser. Nothing you type is sent to us, saved, or added to the page address. See our Privacy Policy.
Rent
Total for all units. A lender generally counts the lower of the lease and the appraiser’s market rent.
Your loan figures
Type the rate from your own quote. This page does not suggest one.
From your own quote, in whole years.
Property costs
Include flood insurance if the property needs it.
Leave blank if none.
A ratio to test (optional)
The loan size is always shown at a ratio of one, where the rent just covers the payment. To see it at another ratio, such as the one on your own quote, type it here.
Your estimate
This is an estimate, not an offer or a loan decision. It is worked out from the numbers you enter.
| Principal and interest | – |
|---|---|
| Property taxes | – |
| Insurance | – |
| Association dues | – |
| Full monthly payment (PITIA) | – |
| Largest loan at a ratio of one | – |
|---|---|
| Largest loan at the ratio you typed | – |
| Rent needed for a ratio of one | – |
| Rent needed for the ratio you typed | – |
This calculator gives estimates for information, worked out from the numbers you enter. It is not a loan application, a rate quote, an offer of credit, a loan decision or a commitment to lend. The interest rate and term are the ones you enter; we do not state or suggest them on this page. A lender sets the rent it counts from the lease and the appraisal, and each program has its own minimum ratio, loan-to-value, credit and reserve rules. DSCR loans are business-purpose loans for investment property, never for a home you live in. For the full program, see DSCR loans.
Guide
How the DSCR is worked out
The full monthly payment (PITIA): principal and interest at the rate and term you entered, plus a twelfth of the yearly property taxes and insurance, plus the monthly association dues. With an interest-only payment, the interest takes the place of principal and interest.
The ratio: the monthly rent divided by the full monthly payment, shown to two places and cut, not rounded. Above one, the rent covers the payment with room to spare; at one, the rent just covers it; below one, the rent falls short and fewer programs fit.
The loan the rent supports: the calculator works backwards. It takes the rent, divides it by the ratio (one, or the ratio you typed), subtracts the monthly taxes, insurance and dues, and shows the largest loan whose principal and interest fit in what is left, rounded down to the thousand.
The rent a lender counts: generally the lower of the lease and the appraiser’s market rent. Some programs count a lease above market rent when you can show the rent has been received. How DSCR loans work
A worked example, with example figures. Jordan Example, a fictional investor, looks at a single-family rental. Every figure here is an example for you to replace with your own; none is our rate, term or limit.
The payment. Jordan types the rate and term from a quote, and the calculator works out principal and interest of $1,400 a month (example figure). Taxes of $3,600 a year add $300 a month, insurance of $1,200 a year adds $100, and there are no association dues. The full monthly payment is $1,800.
The ratio. The rent is $2,200 a month. $2,200 divided by $1,800 is 1.22, above one: the rent covers the payment with room to spare.
What the rent supports. At a ratio of one, the $2,200 rent leaves $1,800 for principal and interest once the $400 of taxes and insurance is taken off. The calculator shows the largest loan that $1,800 a month would pay at the rate and term Jordan typed.
Next. Jordan asks a loan officer for a quote on the property; the lender checks the rent from the lease and the appraisal, credit, reserves and the property. Get a quote
Questions
DSCR calculator questions
What is a DSCR calculator?
A DSCR calculator works out a rental property’s debt service coverage ratio: how the rent compares with the full monthly payment on the loan. It is the comparison a DSCR loan is based on, so investors use it to test a property before they ask for a quote.
How do you calculate DSCR on a rental property?
Divide the monthly rent by the full monthly payment: principal and interest, plus a twelfth of the yearly taxes and insurance, plus any association dues. A rent of $2,200 against a payment of $1,800 (example figures) gives a ratio of 1.22.
What rent does a lender count?
Generally the lower of the rent on the lease and the market rent from the appraiser’s rent schedule. If the property is vacant, the market rent is used. Some programs count a lease above market rent when you can show the rent has been received.
What does it mean when the ratio is below one?
Below one means the rent does not cover the full monthly payment: the property has negative cash flow, and you pay the shortfall each month from other money. Some programs consider a property with a ratio below one; others need the rent to cover the payment in full, so fewer programs fit.
How much can I borrow on a DSCR loan?
The rent sets one limit: the calculator shows the largest loan the rent would support at a ratio of one, or at a ratio you type from your own quote. The lender also applies its own loan-to-value, credit and reserve rules, so the loan offered can be smaller. A loan officer can tell you which limit applies to your property.
Why doesn’t the calculator fill in an interest rate?
Rates change, and the rate on a rental loan depends on the property, the loan and you. So the calculator uses the rate and term you type from your own quote, and shows nothing until you do. For a quote on a property you have in mind, talk to a loan officer.
Does it work for an interest-only DSCR loan?
Yes. Tick the interest-only box and the payment counted is the interest on the loan. Most programs work out the ratio on the interest-only payment, and some use the full principal and interest payment, so it is worth running both.
Is anything I type saved or sent?
No. The calculator runs in your browser. Nothing you type is sent to us, saved, or added to the page address, and closing the page clears it. To talk a property through, call 732-686-9999 or start a quote.
Have a rental in mind?
Get a quote, apply online, or talk the numbers through with a licensed loan officer.
This page is general information, not a commitment to lend. Programs, terms and eligibility depend on credit, property, rent and underwriting review and are subject to change without notice. Business purpose investor loans are for investment property.
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