DSCR CalculatorDebt service coverage ratio for DSCR loans, rental property, commercial real estate and business loans
See whether a rental property qualifies for a DSCR loan the way lenders actually check it, with rent divided by PITIA, and get an estimated 2026 rate for your LTV and credit score. Find the largest loan the rent supports and the rent you’d need for 1.25. Switch modes for commercial NOI and business cash-flow DSCR.
By Manzoor Ahmad · 13+ years of web development & SEO experienceUpdated October 20, 2026 with current DSCR loan pricing
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Down payment vs. DSCR
More equity means a smaller payment and often a better rate, so DSCR rises with every step.
Fastest ways to raise your DSCR
Each lever on its own, recalculated on your numbers.
What is DSCR (debt service coverage ratio)?
The debt service coverage ratio (DSCR) measures how many times a property’s or business’s income covers its loan payments. A DSCR of 1.00 means income exactly equals the debt payments; 1.25 means income is 25% higher than the payments. Lenders use it to decide how much they’ll lend, and DSCR loans approve investors on the property’s rent instead of their personal income.
DSCR = Gross monthly rent ÷ PITIAPITIA is principal, interest, property taxes, insurance and HOA dues. Most DSCR loan lenders use this simple version.
DSCR = Net operating income ÷ annual debt serviceUses NOI, after vacancy and operating expenses but before the mortgage. Banks commonly require 1.20–1.35.
DSCR = (EBITDA − taxes & draws) ÷ total debt paymentsA “global” DSCR adds every loan the business, and sometimes the owner, pays. SBA lenders often look for at least 1.15.
How to calculate DSCR for a rental property
These are the calculator’s defaults: a $350,000 single-family rental bought with 25% down, a 740 credit score and $2,600 a month in market rent.
At 1.15 the loan is approvable with most DSCR lenders, but it misses the 1.25 tier that unlocks the lowest pricing. Raising the rent to about $2,820 or putting 35% down (which also earns a lower rate) would clear it. The “Down payment vs. DSCR” table above shows each step. To see the full cash flow behind the deal, use the rental property calculator.
What is a good DSCR?
Rent covers less than three-quarters of the payment. Very few programs lend here.
Some lenders allow it with larger down payments, higher rates and strong reserves.
Break-even or better. Accepted by most DSCR lenders, priced slightly higher.
The common target for best pricing and the typical minimum for commercial bank loans.
Lowest rates, highest leverage and the most cushion if rents dip.
DSCR loan requirements and rates in 2026
DSCR loans are non-QM investment property mortgages. They don’t use your tax returns or W-2s, but they price risk carefully.
| Requirement | Typical 2026 standard | Notes |
|---|---|---|
| Minimum DSCR | 1.00 (1.25 for best pricing) | Some programs go below 1.00 with conditions |
| Down payment | 20%–25% | 25% down typically trims 0.15–0.25% off the rate |
| Credit score | 660+; 740+ for best pricing | Lower scores mean lower maximum LTV |
| Cash reserves | 3–6 months of PITIA | 6–12 months on loans of $1M–$2.5M |
| Rent used | Lease or appraiser’s market rent | Many lenders use the lower of the two |
| Loan size | Up to about $2M–$3M | Larger loans need jumbo DSCR lenders |
| Short-term rentals | Select lenders | 12–24 months of booking history or an STR appraisal |
| DSCR pricing factor (Oct 2026) | Effect on rate |
|---|---|
| Par rate, 70% LTV, 740 FICO | ≈6.625% |
| Par rate, 75% LTV, 740 FICO | ≈6.750% |
| Par rate, 80% LTV, 740 FICO | ≈7.000% |
| DSCR 1.50+ | +0.0% |
| DSCR 1.25–1.49 | +0.1% |
| DSCR 1.00–1.24 | +0.3% |
| DSCR 0.80–0.99 | +0.6% |
| Interest-only | +0.2% to +0.5% |
| Cash-out refinance | About +0.2% |
Rates are indicative par benchmarks published for October 2026 and vary by lender, state, property type and prepayment penalty. The calculator applies these adjustments, plus an estimated credit-score adjustment, so you can compare scenarios. Always get a written quote.
DSCR loan vs. conventional investment loan
DSCR loan
- Qualifies on the property’s rent
- No tax returns, W-2s or DTI calculation
- Can close in an LLC
- No limit on number of financed properties
- Rates typically comparable to or slightly above conventional, plus possible prepayment penalties
Conventional investment loan
- Qualifies on your personal income and debt-to-income ratio
- Requires full income documentation
- Must close in your personal name
- Limited to 10 financed properties
- Often the cheapest option for W-2 borrowers with strong income
Self-employed investors, those with many properties, and anyone buying through an LLC often find a DSCR loan simpler. Investors using the BRRRR method commonly refinance into a DSCR loan once the property is rented; model that path with the BRRRR calculator. Fix-and-flip investors usually use short-term hard money instead; compare that route with the house flip calculator.
How to increase your DSCR
A smaller loan lowers principal and interest. Going from 20% to 25% down also often lowers the rate.
Give the appraiser recent leases and nearby rental comps. Lenders use market rent from the Form 1007 rent schedule.
Many DSCR lenders qualify interest-only loans on the lower interest-only payment, which raises DSCR.
Some programs offer 40-year amortization, which reduces the monthly payment.
Taxes and insurance are part of PITIA. Estimate the bill with the property tax calculator.
Paying points can lower the rate by 0.25% or more per point, depending on the lender.
Related DSCR terms this calculator covers
Investors and borrowers look for the same calculation under many names. This one tool handles all of them:
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DSCR questions
How do you calculate DSCR for a rental property?
Divide the gross monthly rent by the monthly PITIA: principal, interest, property taxes, insurance and HOA dues. $2,600 rent ÷ $2,255 PITIA = a DSCR of 1.15.
What is a good DSCR for a DSCR loan?
1.25 or higher earns the best pricing with most lenders. 1.00 to 1.24 is usually approvable at a slightly higher rate, and some programs accept ratios below 1.00 with more down and stronger reserves.
What does a DSCR of 1.25 mean?
Income is 1.25 times the debt payments, or 25% more than needed to cover them. On a $2,000 monthly payment, that means $2,500 of rent or income.
What is the minimum DSCR for a loan?
Most DSCR mortgage lenders require at least 1.00. Commercial banks commonly require 1.20 to 1.35, and SBA lenders often look for 1.15 or more on a business’s cash flow.
What are DSCR loan rates in 2026?
Par DSCR rates for domestic investors were about 6.62% to 7.00% in October 2026 at 70%–80% LTV with a 740 credit score. Lower DSCR, higher LTV, lower credit, interest-only and cash-out all add to the rate.
How much do I need down for a DSCR loan?
Usually 20% to 25% for a purchase. Some lenders go to 80% or 85% LTV for strong borrowers, while lower DSCRs or credit scores may require 30% or more.
Is DSCR calculated with gross rent or net rent?
Residential DSCR loans usually use gross rent divided by PITIA, without subtracting vacancy, management or maintenance. Commercial loans use net operating income, which deducts those costs.
What is a no-ratio DSCR loan?
A DSCR loan that allows a ratio below 1.00, or doesn’t require a minimum at all. It typically needs a larger down payment, higher credit and more reserves, and carries a higher rate.
Can you get a DSCR loan for an Airbnb?
Yes, with lenders that offer short-term rental DSCR programs. They usually use 12–24 months of booking history or an appraiser’s short-term rental income estimate instead of a long-term lease.
What is the difference between DSCR and DTI?
DTI compares your personal monthly debts with your personal income. DSCR compares a property’s or business’s income with its own debt payments, so your salary isn’t part of the calculation.
How do I calculate the maximum loan from DSCR?
Divide the rent by the target DSCR to get the maximum PITIA, subtract taxes, insurance and HOA to get the maximum principal and interest, then convert that payment into a loan amount at the rate and term. The calculator does this automatically.
Is this DSCR calculator free and private?
Yes. It’s free, needs no sign-up and runs entirely in your browser. Nothing you enter is sent to DexoCalc or stored.
Manzoor Ahmad
13+ years of web development & SEO experience · Founder, DexoCalc
Manzoor builds and maintains every DexoCalc calculator, including the full mortgage and property libraries. This DSCR calculator uses the rent-to-PITIA method residential DSCR lenders apply, re-prices the rate as the ratio crosses each lender tier, and covers commercial NOI and business cash-flow coverage.
Sources
Rates and requirements are indicative and change daily. This calculator provides estimates for comparison only, not a loan offer, rate lock or financial advice. Lenders apply their own underwriting rules.