Business DSCR calculator
The debt service coverage ratio (DSCR) compares cash available for debt service with the debt payments due: DSCR = cash available ÷ annual principal and interest. Above 1.0x the business covers its payments; lenders set their own minimums.
Your inputs
Enter cash available for debt service, loan amount, annual interest rate (%), term in years to see the result.
Inputs
- Cash available
- Your definition; lenders vary.
- Loan amount, rate, term
- For a level annual payment.
- Other payments
- Optional existing debt service.
Outputs
- Annual debt service
- Annual debt service
- DSCR
- DSCR
How it is calculated
Annual payment = P × r ÷ (1 − (1 + r)−n)
DSCR = cash available ÷ total annual debt service
Worked example (illustrative)
Illustrative only: $125 of cash available against $100 of annual debt service is a DSCR of 1.25x.
Assumptions and limitations
- Assumes level annual payments; monthly schedules differ slightly.
- Lenders define cash available differently.
- Not a credit decision.
Questions and answers
What DSCR do lenders want?
Each lender sets its own minimum; ask yours.
What counts as cash available?
Commonly EBITDA less taxes and maintenance capex, but definitions vary.
Is DSCR used for acquisitions?
Yes, lenders test whether the target's cash flow can carry acquisition debt.
What if DSCR is below 1.0x?
Cash flow does not cover payments; the shortfall must come from elsewhere.
Sources
Content reviewed October 9, 2026 by the SourceX Partnerships Team. Results are calculated in your browser; nothing you type is stored.