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Calculate cap rate for investment property. Enter NOI and property value to find capitalization rate and compare commercial real estate investment returns.
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Ratio above 1.0 means income exceeds debt payment. Lenders require cushion above 1.0 for approval.
DSCR = Net Operating Income ÷ Annual Debt ServiceSum of principal and interest payments over one year. IO loans use interest-only portion.
ADS = Monthly P&I × 12Reverse calculate affordable debt service from NOI and lender DSCR floor, then solve for loan amount at given rate/term.
Max ADS = NOI ÷ Minimum DSCRUpdated: July 2026
DSCR = 96,000 ÷ 72,000 = 1.33. Exceeds 1.25 lender minimum — loan likely approvable if other criteria met.
NOI approx $32,400 (after expenses), ADS $26,400 → DSCR 1.23. Borderline — may need larger down payment.
Higher rate increases ADS, drops DSCR. Model refi at +2% rate before committing to floating-rate bridge loan.
Determine whether a property generates enough income to cover mortgage payments for commercial and DSCR loan underwriting. Enter net operating income and annual debt service (P&I) to calculate DSCR and compare against lender minimums (typically 1.20–1.25).