Interactive tool

Commercial DSCR Calculator

Stress-test debt service coverage for commercial apartment buildings—not residential 1–4 unit DSCR programs.

Last updated: 2026-05-24

DSCR inputs

Enter your deal

I/O mode

Monthly gross rent

Market rent or lease rent

Monthly principal + interest

P&I from amortization

Monthly property tax

Annual tax / 12

Monthly insurance

Hazard premium / 12

Monthly HOA

Optional

Flood / other

Optional

Your DSCR

1.37

1.25+ — best pricing

Best rates available. Full LTV access, fastest approvals, widest lender pool.

Monthly gross rent: $2,800
Monthly PITIA: $2,050
Monthly cash flow: $750
Annual cash flow: $9,000

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What this means

DSCR is your rent divided by PITIA (principal, interest, taxes, insurance, association dues). It's the single most important number a multifamily lender looks at. A 1.00 DSCR means your rent exactly covers the mortgage. Lenders price the loan off of it — higher DSCR, better rate, higher LTV.

Which lender tier qualifies?

DSCR band	What you'll find	Typical LTV cap
Sub-0.75	Limited — consider a no-ratio or Griffin-style program	65–70%
0.75 – 0.99	Competitive — 5+ lender options	70–75%
1.00 – 1.24	Broad lender access, mainstream pricing	up to 80%
1.25+	Best rates, widest lender pool, fastest approvals	up to 80% (85% select)

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How to calculate commercial DSCR

For multifamily acquisitions and refinances on 5+ units, commercial DSCR is:

DSCR = NOI ÷ Annual Debt Service

Annual debt service includes principal and interest (and sometimes lender-required reserves). Use normalized NOI consistent with lender underwriting, not unadjusted sponsor projections.

Worked example: 32-unit value-add acquisition

A sponsor acquires a 32-unit value-add property. In-place normalized NOI is $480,000. Proposed permanent debt service is $380,000 per year at full amortization.

In-place DSCR: $480,000 ÷ $380,000 = 1.26x
Stabilized NOI target of $620,000 implies 1.63x coverage on the same debt service

Bridge lenders may size on in-place metrics while agency takeout lenders focus on stabilized coverage. See our commercial DSCR guide and agency vs bridge comparison.

Frequently asked questions

What is commercial DSCR for multifamily?

Commercial DSCR measures whether normalized NOI covers annual debt service (principal and interest). Lenders on 5+ unit properties use DSCR with debt yield and LTV to size proceeds—not residential 1–4 unit DSCR programs.

How do you calculate DSCR?

DSCR = NOI ÷ Annual Debt Service. If NOI is $960,000 and annual P&I is $720,000, DSCR is 1.33x. Higher coverage generally supports more proceeds or better pricing.

What DSCR do multifamily lenders require?

Requirements vary by product and asset stage. Many stabilized agency deals target roughly 1.20x–1.30x on in-place NOI, while bridge lenders may accept lower in-place coverage if a credible stabilization plan exists.

Why does my DSCR differ from the lender's?

Lenders may haircut revenue, stress expenses, include reserves, and use their own rate and amortization assumptions. Sponsor spreadsheet DSCR often runs higher than lender underwriting DSCR.

Does interest-only debt affect DSCR?

Yes. IO periods reduce near-term debt service, which can inflate DSCR temporarily. Lenders often also test amortizing DSCR or debt yield to avoid over-leveraging into IO structures.

How can I improve DSCR before refinancing?

Focus on durable NOI improvements—occupancy, effective rent, expense control—and realistic loan sizing. Short-term rate bets rarely substitute for stronger operating performance.

Is this calculator for residential DSCR loans?

No. Multi-Family USA focuses on commercial multifamily financing for 5+ unit apartment buildings. Residential 1–4 unit DSCR products follow different guidelines.