LTV & DSCR Calculator
Check your loan-to-value and debt service coverage ratio against typical lender covenants before you talk to the bank. Free and private — nothing leaves your browser.
LTV & DSCR Checker
Will the bank like this deal?
How it works
DSCR = NOI / Annual Debt Service · LTV = Loan / Property ValueLenders underwrite two constraints at once. Loan-to-value caps how much of the property's value they'll finance (typically 60-75% for commercial assets). The debt service coverage ratio checks whether the building's income actually carries the loan: annual net operating income divided by annual mortgage payments. Banks usually demand at least 1.20-1.25×, meaning income must exceed debt payments by 20-25%. Your real borrowing limit is whichever constraint binds first — this calculator shows both and flags the binding one.
Worked example
Say a property produces €120,000 NOI and you want a €1.5M loan at 5% amortizing over 300 months. The annual debt service is about €105,200, so DSCR is 1.14× — below the 1.25× most banks require, even if the LTV looks fine. At that rate and term, the income actually supports roughly €1.37M of debt. The €130,000 gap is what you'd need to cover with extra equity or negotiate away with a longer amortization.
Frequently asked questions
What is DSCR?→
The Debt Service Coverage Ratio divides net operating income by annual debt payments. A DSCR of 1.25 means the property earns 25% more than its loan costs — the buffer lenders rely on.
What DSCR do banks require?→
Most commercial lenders want at least 1.20-1.25x, with 1.50x considered comfortable. Below 1.0 the property doesn't cover its own debt and needs cash injections from the owner.
What is LTV and how does it relate?→
Loan-to-value is the loan amount divided by the property's value. Banks typically cap LTV at 60-75% for commercial property. Your maximum loan is whichever constraint binds first: the LTV cap or the DSCR requirement.
No black boxes — the exact formula is shown above · Last reviewed July 2026