A DSCR is a covenant as much as a ratio: the loan is sized at one level and then tested at another for the life of the loan. Each row shows the NOI at which coverage sits exactly at that level, and how much of today's income could disappear first.
| Coverage level | NOI at that level | Cushion | As a share of NOI |
|---|---|---|---|
| 1.00x, breakeven | $480,000 | $120,000 | 20.0% |
| 1.20x, a common ongoing covenant | $576,000 | $24,000 | 4.0% |
| 1.25x, a common sizing floor | $600,000 | $0 | 0.0% |
Annual convention throughout: NOI and debt service both measured over twelve months, principal plus interest. Whether reserves are deducted above the NOI line and whether the ratio is tested at the note rate or a stress rate are choices this page cannot make for you; the lender's term sheet makes them, and the honest comparison uses the lender's.
Everything above is computed in your browser. Nothing you type is sent to Altyst or to the site hosting this calculator, and this frame sets no cookie. It is arithmetic on the figures you entered, not investment or lending advice.
Coverage is one of the three tests a lender runs; the loan is sized by whichever of the three allows the least. Altyst reads the deal documents, builds the NOI, and runs all of it.