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Debt Yield Break-Even Calculator
Debt yield = NOI ÷ loan. Lenders use it because unlike DSCR or LTV it doesn't flex with rate or cap rate — it is a pure return on the lender's capital. Use this calculator to check whether a proposed loan sizes to a target debt yield, the maximum loan at that minimum, and the NOI cushion above break-even.
Current debt yield
8.40%
Max loan at minimum debt yield
$4,666,667
NOI required to meet minimum
$450,000
NOI cushion above minimum
-$30,000
Meets lender minimum
No
How the math works
Debt yield = NOI ÷ loan amount. It measures return to the lender if they had to foreclose and take the property. It is independent of cap rate and interest rate, which is why post-2008 lenders rely on it.
Typical minimums: 8–9% on stabilized multifamily, 10–11% on retail and office, 12%+ on hospitality. The break-even point is where NOI exactly equals loan × minimum debt yield.
How to Use
- Enter the stabilized NOI for the property.
- Enter the proposed loan amount from the lender.
- Enter the lender's minimum debt yield requirement (typical 8–12%).
- Read the current debt yield, max loan, and NOI cushion.
Frequently Asked Questions
Why do lenders use debt yield instead of DSCR?
DSCR depends on amortization and interest rate — a lender can hide weak cash flow behind a 30-year IO loan. Debt yield strips those out and asks: 'If I foreclose tomorrow, what return do I earn?'
Typical minimums?
Stabilized multifamily: 8–9%. Retail and office: 10–11%. Self-storage and industrial: 9–10%. Hotels: 11–13%. CMBS lenders are usually 1–2% higher than banks.
Break-even NOI?
It's the NOI at which current loan × minimum debt yield = NOI. Below that, the lender is out of cushion and will resize the loan down.
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Debt Yield Calculator
Calculate debt yield (NOI divided by loan amount) and the max loan a lender will fund at the minimum debt yield.