| Debt
Service (Coverage) Ratio |
 |
Calculated
by:
|
DSCR
=
|
Net
Operating Income
|
|
|
|
Total
Debt Service
|
This ratio is often used by bank loan officers when making loans to
perspective income property loans.
|
 |
This
ratio should be over 1 because it means the property is generating
enough income to pay its debt obligations. |
|
|
|
Dictionary
