Calculate your Debt Service Coverage Ratio and see if your rental property qualifies for financing.
The Debt Service Coverage Ratio (DSCR) is a metric lenders use to evaluate whether a property generates enough income to cover its debt. This calculator helps investors see if their rental meets typical DSCR requirements for financing.
DSCR is calculated by dividing the property's annual net operating income (NOI) by its total annual debt service. A DSCR of 1.0 means the property generates just enough income to cover its debt payments. Most lenders require a minimum DSCR of 1.25 for investment properties.
DSCR ranges
Income does not cover debt.
Property breaks even.
Typical minimum for most lenders.
Strong cash flow.
Lender perspective
Most DSCR lenders look for a minimum ratio of 1.25, meaning the property generates 25% more income than needed to cover debt payments. This buffer provides security against vacancy periods, unexpected expenses, or market fluctuations.
Higher DSCR ratios (1.5+) often qualify for better interest rates and loan terms, as they represent lower risk investments.
Key advantages
Qualification based on property performance.
Focus on rental income, not W-2.
Less documentation, quicker underwriting.
Scale without personal income limits.
Works for various property types.
Ideal for
When calculating DSCR, remember to:
Why DSCR matters
A strong DSCR helps secure financing and signals profitability. Use it to evaluate deals, plan refinancing, manage portfolio risk, and compare properties.
Properties with DSCR ratios above 1.5 typically perform well even during economic downturns. Consider market trends, local employment rates, and population growth when evaluating long-term DSCR sustainability.
Connecting with our DSCR and conventional lending partners is free and has no obligation.
Have questions about DSCR loans? Check our FAQs →
Continue your investment analysis.
Sign up for our newsletter
Monthly insights, tips, and exclusive offers for STR investors.
All Real Estate Services are offered through Chalet Realty (DBA of Mahalla Realty LLC).
Texas Real Estate Commission Consumer Protection NoticeTexas Real Estate Commission Information About Brokerage ServicesTREC DisclaimerChalet (“GetChalet Inc.”) provides general educational content and tools for real-estate investors. Chalet is not a law firm, CPA firm, or investment adviser, and does not provide tax, legal, or accounting advice. Nothing on this site creates a CPA-client, attorney-client, or fiduciary relationship. Tax laws change, and state rules may differ from federal rules (e.g., California decouples from federal bonus depreciation). Always consult your own qualified tax and legal professionals about your specific situation.
The term 'Airbnb' is used on our site in a colloquial sense, akin to saying 'I am going to Airbnb it.' This usage is intended to refer broadly to the concept of short-term rentals and not specifically to the Airbnb platform or services. Airbnb, Inc. is not affiliated with Chalet, nor does it endorse or sponsor our services. We use the term in this generalized manner to easily convey the idea of participating in short-term rental activities, recognizing 'Airbnb' as a term familiar to many in this context.
Affiliate & Referral Disclosure. Chalet may receive referral fees or other consideration when you engage with featured agents, lenders, cost-seg providers, or other partners referenced on this site. These relationships may influence which partners we present. We follow the FTC Endorsement Guides and aim to disclose material connections clearly and conspicuously.
Chalet (DBA of GetChalet Inc.) is not affiliated, associated, authorized, endorsed by, or in any way officially connected with Airbnb, Airbnb.com, or any of its subsidiaries or its affiliates. The official Airbnb website can be found at http://www.airbnb.com. The name "Airbnb" as well as related names, marks, emblems and images are registered trademarks of Airbnb, Inc.
