Real Estate Calculators
Does the rent cover the debt service, and by how much?
The debt service coverage ratio, DSCR, is how lenders measure whether a property's rent can carry its own mortgage. You take the building's monthly net income, rents minus operating expenses, and divide by the total monthly debt payment. Above the lender's floor, the income does the qualifying, not your W-2, which is why DSCR loans matter to so many Lehigh Valley investors.
Monthly debt coverage inputs
Lender guidance differs by product: many small-balance loans in the Lehigh Valley look for at least 1.20, and 1.25 is a common comfort line. The ratio below is the property speaking for itself.
Why the cushion matters: a 1.04 DSCR means a 4 percent dip in income, one vacant month in a two-dozen-month window, erases the cushion. Lenders underwrite to their floor, but Tim underwrites to survive: he wants to see the ratio hold with a vacancy year and a tax bump before he recommends the deal, especially for a first purchase.
Run the numbers with Tim, then talk them through
Estimates are a great starting point. A 20-minute conversation with Tim Tepes turns them into a plan you can act on, with real listings, real comparables, and honest advice.
Estimates are for education and planning only, not a loan approval, appraisal, or tax advice. Actual costs, rates, and values vary by property and lender.