Debt Yield Calculator
Calculate the leverage-neutral return for commercial lenders. Preferred by CMBS and agency underwriters to establish maximum loan limits.
Property Cashflow
Loan Sizing Sourced from Purchase Price
Debt Sizing Output
Sizing Tier: Moderate / Standard Underwriting
Meets traditional debt thresholds for conservative asset classes (multifamily in major metropolitan MSA markets). May require a personal guaranty or reserves.
Why Lenders Rely on Debt Yield
Unlike the DSCR or LTV ratios, Debt Yield is completely unaffected by low interest rates or extended amortization periods. It calculates the lender's cash-on-cash return if they were forced to foreclose and take over the property.
Debt Yield = (NOI / Loan Amount) × 100
If a property generating $650,000 NOI requests a $7,500,000 loan, the Debt Yield is 8.67%. If the market deteriorates, this represents the yield buffer the bank receives, making it an essential underwriting pillar.