Debt-Service Coverage Ratio - DSCR
- Debt-Service Coverage Ratio - DSCR
- In corporate finance, it is the amount of cash flow available to meet annual interest and principal payments on debt, including sinking fund payments.
In government finance, it is the amount of export earnings needed to meet annual interest and principal payments on a country's external debts.
In personal finance, it is a ratio used by bank loan officers in determining income property loans. This ratio should ideally be over 1. That would mean the property is generating enough income to pay its debt obligations.
In general, it is calculated by:
A DSCR of less than 1 would mean a negative cash flow. A DSCR of less than 1, say .95, would mean that there is only enough net operating income to cover 95% of annual debt payments. For example, in the context of personal finance, this would mean that the borrower would have to delve into his or her personal funds every month to keep the project afloat. Generally, lenders frown on a negative cash flow, but some allow it if the borrower has strong outside income.
Investment dictionary.
Academic.
2012.
Look at other dictionaries:
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debt-service coverage ratio — earnings before interest and income taxes, divided by interest expense plus the quantity of principal repayments divided by one minus the tax rate. Bloomberg Financial Dictionary * * * debt service coverage ratio UK US noun [C] (ABBREVIATION… … Financial and business terms
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Ratio financier — En comptabilité, un ratio est un rapport calculé entre deux masses fonctionnelles du bilan et/ou du compte de résultat. Il se traduit par un pourcentage ou un coefficient. Il existe plus de cent ratios permettant de formuler une opinion motivée… … Wikipédia en Français
Taux de couverture de la dette — Le Debt Service Coverage Ratio (DSCR), ou taux de couverture de la dette (TCD), exprime le rapport entre l Excédent brut d exploitation et le service de la dette (intérêt, principal et, le cas échéant, annuités de crédit bail). C est un outil… … Wikipédia en Français
Kapitaldienstdeckungsgrad — Der Schuldendienstdeckungsgrad oder auch Kapitaldienstdeckungsgrad (engl. Debt Service Coverage Ratio (DSCR)) ist das Verhältnis von Gewinn vor Zinsen und Steuern (EBIT) bzw. dem Cash Flow vor Zinsen und Tilgung zum Schuldendienst einer Periode… … Deutsch Wikipedia
Schuldendienstdeckungsgrad — Der Schuldendienstdeckungsgrad oder auch Kapitaldienstdeckungsgrad (engl. Debt Service Coverage Ratio (DSCR)) ist das Verhältnis von Gewinn vor Zinsen und Steuern (EBIT) bzw. dem Cash Flow vor Zinsen und Tilgung zum Schuldendienst einer Periode… … Deutsch Wikipedia
