If you're shopping for a rental and you've heard the term “DSCR” thrown around, here's the plain-English version — plus a free tool to run your own numbers.
DSCR, defined
DSCR stands for debt-service coverage ratio. It's the property's rent divided by its total monthly mortgage payment — principal, interest, taxes, insurance and any HOA dues. A ratio of 1.0 means the rent exactly covers the payment. Above 1.0, the property produces positive coverage; below 1.0, it falls short on paper.
What counts as a “good” DSCR?
- 1.25 and up — strong; the property comfortably covers its payment, and you'll have the widest set of programs to choose from.
- 1.00 to 1.25 — solid; qualifies on many DSCR loan programs.
- 0.75 to 1.00 — workable; some lenders offer reduced-ratio programs with other compensating factors.
- Below 0.75 — tighter; ask about no-ratio programs, where the property's cash flow isn't used to qualify at all.
These are general ranges, not guarantees — every lender sets its own thresholds, which is exactly where a brokerage helps.
Calculate yours
Use our free DSCR calculator: enter the monthly rent, your estimated loan amount and rate, the term, and the monthly taxes and insurance. It returns the coverage ratio instantly and flags roughly where it falls. It's a self-help illustration — not a quote — but it's the fastest way to size up a deal.
When you find one that pencils out, contact us or call (401) 481-8050 and we'll match it to the right program.
Have questions about how this affects your plans? Our team is happy to talk through your scenario — call (401) 481-8050 or get in touch.