Cash Flow Sweep Calculator

Commercial loans often include a cash flow sweep covenant — below a DSCR threshold, excess cash flow is captured by the lender for principal paydown instead of flowing to equity. This calculator tests whether the trigger is hit, how much gets swept, and how long it will take to meet the release test.

Annual NOI

Annual debt service

Sweep DSCR trigger

Sweep % of excess cash flow

Current loan balance

Current DSCR

1.58

Sweep triggered?

Annual sweep amount

Loan balance reduction / year

Excess cash flow (NOI − DS)

$220,000

NOI gap to break trigger

How the math works

A cash flow sweep is a loan covenant — below a DSCR threshold (usually 1.20x on CRE), some or all excess cash flow is swept to pay down the loan instead of distributing to equity. Stays in effect until DSCR recovers above the trigger for several consecutive quarters.

Sweeps are painful for equity — no distributions while the trigger is active — but they protect the lender by forcing deleveraging when cash flow weakens. Always negotiate a clear release test.

How to Use

Enter annual NOI and annual debt service.
Enter the sweep DSCR trigger (commonly 1.15-1.20x).
Enter the sweep percent (50-100% of excess cash flow is typical).
Enter the current loan balance.
Read whether the sweep is active and the annual paydown.

Frequently Asked Questions

When does sweep release?

Usually two consecutive quarters or four consecutive quarters of DSCR above the trigger + a cushion. Negotiate the release test tightly — 'trailing 12 months' is easier to meet than 'quarterly in isolation.'

Does sweep accelerate maturity?

No — it accelerates amortization. Principal paydown from the sweep shortens the effective life of the loan but doesn't trigger a due date change. Final maturity stays the same.

Can I avoid sweep with reserves?

Sometimes. Lenders may let you pledge additional equity to a reserve account in lieu of sweeping cash. This 'bad boy' mitigation keeps distributions flowing but parks equity behind the loan.