DSCR Trigger Cure Calculator

DSCR breaches trigger cure rights — cash injection restores covenant compliance.

Annual NOI

Annual debt service

Covenant DSCR

Months to cure

Cure equity required

$250,000

Current DSCR

1.17

Required NOI

$3,000,000

How the math works

Required NOI = debt × covenant. Shortfall = required − current. Cure equity covers shortfall plus residual period.

$2.4M × 1.25 = $3M required. $3M − $2.8M = $200k shortfall. Cure ≈ $250k equity injection.

How to Use

Enter annual NOI.
Enter annual debt service.
Enter covenant DSCR threshold.
Enter months to cure.
Read cure equity required.

Frequently Asked Questions

Cure mechanics?

Borrower deposits cash into reserve account to artificially lift NOI to covenant threshold. Cash classified as deemed NOI for covenant calc. Lender releases funds to borrower once sustained compliance achieved.

Typical thresholds?

Conservative: 1.35-1.50× DSCR. Standard: 1.20-1.35×. Aggressive: 1.10-1.20× (cash flow sweep at 1.15× typical). Sub-1.10× usually triggers default, not cure right.

Cash flow sweep?

At sub-covenant DSCR, excess cash from operations trapped in lender-controlled account until covenant restored. Prevents equity from extracting cash while lender bears risk. Typical trigger: 1.15-1.20× DSCR.

What documentation matters here?

Written leases, move-in/move-out inspections with photographs, ledger entries showing every payment and charge, served notices with proof of service, and contemporaneous emails or texts. Courts weigh written evidence heavily; informal understandings rarely stand. Institutional operators run a monthly file audit to catch gaps before they matter. Good paper trails recover most of what's owed.