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DSCRCalculators
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RentalRookie

I see you have a DSCR calculator but I am not sure what numbers to plug in or what the output actually tells me.

Answer from Jon Howard (HCP): Quick walkthrough. The calculator needs five inputs and gives you a qualifying DSCR plus an estimated loan amount.

Inputs: (1) Property Value — use current purchase price or, for a refinance, a conservative estimate of appraised value. (2) Down Payment % — 20-25% is standard. (3) Monthly Rent — use the lower of your signed lease or market rent; if it is an STR, see my other post on STR-DSCR. (4) Interest Rate — use today's indicative rate (the calculator shows a current range). (5) Property Taxes & Insurance — annual figures; if you do not know, use 1.2% of value for taxes and $1,200/year for insurance as a starting estimate.

Outputs: (a) Monthly PITIA — total monthly payment. (b) DSCR — rent ÷ PITIA. Green zone (≥1.15) = best pricing. Yellow (1.00-1.14) = qualifies, slight rate bump. Red (<1.00) = needs No Ratio program or more down. (c) Estimated Max Loan — the lender ceiling at your inputs.

Two tips: (1) toggle different down payments to see how DSCR moves — often a 5% higher down payment flips a red property green, (2) if HOA dues apply, add them to insurance because the "A" in PITIA is association dues. Bring a screenshot of the calculator output to our initial call and we can move straight into a real quote.

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Jon Howard
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Happy to walk through it. The DSCR calculator needs five inputs and gives you a qualifying ratio plus a rough down-payment target:

  1. Purchase price (or current appraised value for a refi).
  2. Monthly market rent — use the actual lease, or Rentometer / AppFolio market-rent comp. Do not use Zestimate's "rent estimate" — it skews high.
  3. Property taxes (annual) — from the county assessor or Zillow's tax history.
  4. Homeowners insurance (annual) — quote from your agent; $800–$1,800 is typical on a SFR.
  5. HOA (monthly, if any).

The calculator computes PITIA, divides rent by PITIA, and gives you a DSCR ratio. Interpretation:

  • 1.25+ — A-tier pricing, 20% down achievable.
  • 1.00–1.24 — bankable, usually 25% down.
  • Under 1.00 — possible but expect 30%+ down and meaningful rate bump.

The down-payment slider lets you see how increasing equity moves the ratio — useful for "how much do I need to put down to hit 1.25?"

Practical next step: Run the calculator with the actual lease rent (not projected), then screenshot the result and send it to me. I can tell you in one email whether the deal is close to pricing or needs restructuring.

Happy to run your specific numbers — call 970-457-9107 or email jon@homesteadcapitalpartners.com.

NMLS #2587985 · Licensed Colorado · For educational purposes — not a commitment to lend.

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Riley O'Sullivan
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If you're running the calculator for the first time — I made a walkthrough on our TikTok showing the five inputs step-by-step with a real property. The "use the actual lease rent, not Zestimate" note cannot be overemphasized. Lenders will pull their own 1007 and if yours doesn't line up, you're in for a surprise underwriting condition. Also — the down-payment slider is the most useful feature on the whole page. Start at your preferred number, see the ratio, then drag until you hit the tier you're targeting. Makes the whole thing concrete.

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Denise W.
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I ran Jon's DSCR calculator when I was shopping my fourth rental last summer and it genuinely saved me from making a bad offer. The property looked fine on paper but when I plugged in conservative market rent (Rentometer P25, not the median), real property taxes pulled from the county site, and an insurance quote I had in hand from my broker, the ratio came back 0.92. Not a disaster, but not what the listing agent had implied.

The "P25 rent" trick is worth emphasizing — use the bottom-quartile comp, not the average. You'll never regret underwriting conservatively, and lenders end up pretty close to that number anyway once they do the 1007. I learned this the hard way on my second property when Zillow's rent estimate was $400/month higher than what I could actually lease it for.

One thing Jon didn't mention that I found useful: play with the down payment slider backwards. Start at 20%, see the ratio, then drag up until you hit 1.25. That tells you the minimum cash to make the deal A-tier, which is usually what you want to negotiate the purchase price or concessions around. My lender thanked me for showing up with numbers already run.

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