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Debt yield calculator
Compare a property's annual operating income with its loan balance. Debt yield puts income and loan size on the same scale without using an interest rate.
Income after operating expenses, before loan payments and income taxes.
Use the original loan amount for entry yield, or today's balance for a current yield.
Debt yield
Debt yield is an income-to-loan measure. It does not measure scheduled payment coverage, recovery value or the probability of repayment.
Example amounts are prefilled. Change any field to see your result instantly. Your financial inputs stay in this browser.
How to calculate debt yield
Debt yield is the annual NOI divided by the loan amount. It shows how much property income supports each dollar lent. For the same NOI, a smaller loan produces a higher debt yield. It does not depend directly on interest rate or amortization.
Debt yield = annual NOI / loan amount × 100
Worked example
With $600,000 of annual NOI and a $6,000,000 loan, debt yield is $600,000 / $6,000,000 × 100 = 10.00%.
Frequently asked questions
How is debt yield different from DSCR?
Debt yield divides NOI by loan amount. DSCR divides NOI by annual debt service, which changes with interest rate, amortization and payment structure.
Does changing the interest rate change debt yield?
Not directly. If NOI and loan amount stay the same, debt yield stays the same even when the payment changes.
Which loan amount should I use?
Use the funded loan at acquisition for entry debt yield. For a later year, use the beginning balance of that year and that year's NOI. State whether the balance includes all loans.
See how the full model works in our engine methodology or review a worked property example.