How much debt your cashflow can carry
Your debt service coverage ratio is the first number a lender checks. See where you stand and how much more you can responsibly borrow, before you apply.
Revenue minus operating expenses, before financing payments.
Loan, MCA, and lease payments you already make.
The payment on the financing you are considering. Optional.
Strong. Comfortably covers debt; most lenders clear 1.25+.
Lenders size loans off DSCR, not just revenue. Above 1.25 you have room; at 1.0 you are covering payments with nothing to spare. Estimates only, from the numbers you enter.
DSCR, in plain terms
What is a good DSCR for a business loan?
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Most lenders want a debt service coverage ratio of at least 1.25, meaning your net operating income is 25% more than your total debt payments. At 1.0 you exactly cover your payments with nothing to spare, which most lenders treat as too tight. Below 1.0 your cashflow does not cover the debt.
How is DSCR calculated?
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DSCR equals net operating income divided by total debt service. Net operating income is your revenue minus operating expenses, before financing payments. Total debt service is every loan, advance, and lease payment for the period, including any new financing you are considering.
How much can I borrow based on DSCR?
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Take your net operating income, divide by the target ratio (commonly 1.25), and subtract the debt payments you already carry. What is left is roughly the additional monthly payment your cashflow supports. This tool shows that figure as you type.
You estimated it. Now see it read from your account
DSCR is the first number an underwriter runs, and rarely the last. Connect the bank once and New Matrix reads the real figures off your statements, scores the file, and lines up the funders whose rules it clears. Free to join, no advance fees.