How it works
Debt service coverage ratio = annual net operating income / annual debt service for the same period.
Input definitions
- Annual net operating income
- Enter the value in the labeled unit.
- Annual principal and interest payments
- Enter the value in the labeled unit.
A worked example
- Annual net operating income
- 120000
- Annual principal and interest payments
- 80000
Assumptions & limits
Planning model using the rates, cash flows and periods entered. Examples are illustrative, not market quotes or personalised financial advice. Taxes, inflation and transaction costs are excluded unless explicitly entered.
Sources & review
Maintained by AnsRio. Methods and examples use automated checks; this does not imply independent professional certification.
Method updated 2026-10-18. Content checked against the stated method and examples. Our verification approach.
Common questions
Is a ratio above one enough for loan approval?
No. Lenders define cash flow, stress assumptions and minimum ratios differently. This calculates only the entered ratio.
How does Debt service coverage ratio work?
Debt service coverage ratio = annual net operating income / annual debt service for the same period.
What should I check before using Debt service coverage ratio?
Planning model using the rates, cash flows and periods entered. Examples are illustrative, not market quotes or personalised financial advice. Taxes, inflation and transaction costs are excluded unless explicitly entered.