What is debt service coverage ratio (dscr)?
Debt Service Coverage Ratio (DSCR): How many times over your cash flow covers your loan payments.
How it works
DSCR = EBITDA / Annual Debt Service. Bank lenders typically want 1.25× or higher. Factoring doesn't use DSCR because it isn't debt.
Where you will run into it
Debt Service Coverage Ratio (DSCR) comes up most often in sba & term loans conversations. See how sba & term loans works, including real cost ranges and timelines.
Related terms
Debt Service Coverage Ratio (DSCR) questions
How many times over your cash flow covers your loan payments.
DSCR = EBITDA / Annual Debt Service. Bank lenders typically want 1.25× or higher. Factoring doesn't use DSCR because it isn't debt.
Funding Requirements Checklist for US manufacturers
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