Debt Service Coverage Ratio (aka: DSCR) is the ratio of the net operating income to debt payments on a piece of investment real estate. It is a benchmark used in the measurement of an income-producing property’s ability to produce enough revenue to cover its monthly mortgage payments. The higher this ratio is, the easier it is to borrow money for the property.

The phrase is also used in corporate finance and may be expressed as a minimum ratio that is acceptable to a lender; it may be a loan condition, a loan covenant, or a condition of default.

The formula used to find the debt service coverage ratio is as follows:
DSCR = Net Operating Income / Total Debt service