Debt Coverage Ratio – Measures cash flow by comparing net operating income (NOI) to the debt service (PI). A DCR (also known as DSCR debt service coverage ratio) of 1 means you have an equal amount of income and debt which leaves no room for surprise expenses. A ratio greater than 1 like 1.2 means you have positive cash flow.

  Net Operating Income
÷ Loan Principal & Interest
= Debt Coverage Ratio
÷ $82,497
= 1.36%

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