Common Real Estate Terms
Learn the Lingo of Multifamily Investing – we are here to help!
There are currently 4 names in this directory beginning with the letter D.
The periodic payments required to cover the interest payments -- and usually also including a portion of the principal amount -- of a loan.
Debt Service Coverage Ratio (DSCR)
Debt Service Coverage Ratio (DSCR) measures the cash flow available to cover the property's debt obligation. This ratio is calculated by dividing the net operating income by the total debt service. A DSCR of 1.0 shows there is enough net operating income to cover 100% of the debt service.
Depreciation allocates an asset's cost over its useful life. Depreciating assets helps companies expense a portion of the asset's cost each year the asset is in use while earning revenue on the investment.