DSCR Calculator
Calculate your Debt Service Coverage Ratio. Lenders require a minimum DSCR of 1.25x for SBA loan approval.
Enter Your Numbers
$
SDE or EBITDA depending on context
$
Total annual loan payments (all loans)
How DSCR Is Calculated
DSCR = $180,000 / $120,000 = 1.50x
Annual Cash Surplus/Deficit$60,000
Max Debt Service (at 1.25x DSCR)$144,000
Monthly Cash Surplus$5,000/mo
DSCR Scale
0.5x1.0x1.25x (min)1.5x2.0x+
Your DSCR
1.50x
Excellent debt coverage. Lenders love this.
SBA Minimum (1.25x)
PASSES
Max Affordable Debt Service
$144,000
At 1.25x DSCR threshold
Model the full deal structure
See how SBA loan, seller note, and down payment affect your DSCR.
Try Full Analyzer →What Is DSCR and Why Does It Matter?
The Debt Service Coverage Ratio measures a business's ability to pay its debt obligations from operating income. It's the most important metric lenders look at when approving SBA loans.
DSCR Benchmarks
- Below 1.0x: Cash flow doesn't cover debt payments. Loan will be denied.
- 1.0x - 1.24x: Marginal. Tight cash flow, high risk of default.
- 1.25x+: SBA minimum requirement. Most lenders start here.
- 1.5x+: Strong coverage. Best rates and terms.