What is DSCR (Debt-Service Coverage Ratio)?

DSCR (Debt-Service Coverage Ratio) in Relation to HUD 221(d)(4) Loans

DSCR, or debt service coverage ratio, is a measurement of a property’s cash flow compared to the amount of money needed to pay current debts like interest, principal, and lease payments. DSCR is one of the most important metrics used by lenders to determine an income generating property’s eligibility for a loan.  

For HUD 221(d)(4) loans, DSCR requirements are:

To learn more about HUD multifamily construction loans like the HUD 221(d)(4) loan, fill out the form below and a HUD lending expert will get in touch.