Finance
DSCR (Debt Service Coverage Ratio)
A concise definition for the California Real Estate Exam study guide.
Definition
DSCR = NOI ÷ Annual Debt Service. Above 1.0 means NOI covers debt service. Below 1.0 means income falls short. Lenders use DSCR in commercial underwriting.
Why it matters on the California real estate exam
Know the definition, recognize how the term appears in a fact pattern, and compare it with related concepts before choosing an answer.
Study this topic in context
Read the related chapter for the surrounding concepts, examples, and exam tips.
Chapter 5: Finance, Mortgages & Loan Types →