Calculate Debt Yield (NOI ÷ Loan Amount) — the metric CMBS and institutional lenders prioritize over DSCR and LTV. Find your maximum loan amount based on target debt yield.
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Why institutional lenders prefer debt yield over DSCR.
Unlike DSCR, debt yield is independent of interest rate, amortization, and loan term. It measures the lender's return if they had to foreclose and operate the property. A 10% debt yield means the lender would earn 10% annually on their loan from the property's NOI alone — regardless of market rates.
CMBS/Conduit: 8–10% minimum. Life insurance companies: 9–11%. Agency multifamily: 7–9%. Banks may not explicitly require it but will check. Higher debt yield = lower risk to the lender = better loan terms for you.
Increase NOI (higher rents, lower expenses, reduce vacancy) or reduce the loan amount requested. Unlike DSCR, you cannot improve debt yield by changing loan terms. Our advisors help you present the strongest NOI documentation to maximize your available leverage.
Minimum thresholds across different lending sources.
| Lender Type | Min Debt Yield | Typical Deal Size | Property Types |
|---|---|---|---|
| CMBS / Conduit | 8–10% | $3M–$50M+ | All stabilized CRE |
| Life Insurance Co. | 9–11% | $5M–$100M+ | Class A office, multifamily, industrial |
| Agency (Fannie/Freddie) | 7–9% | $1M–$50M+ | Multifamily only |
| National Bank | 8–10% | $2M–$25M | Diversified CRE |
| Regional/Community Bank | Not primary metric | $500K–$10M | All CRE, owner-occupied |
Every calculator we offer, in one place — run the next number your lender will ask about.
Common questions about debt yield in commercial lending.
Debt Yield = Annual NOI ÷ Loan Amount × 100. It measures the lender's theoretical return if they foreclosed and operated the property. A $120K NOI on a $1M loan = 12% debt yield. Higher is better from the lender's perspective.
DSCR depends on interest rate and amortization — a borrower can inflate DSCR by choosing a longer amortization. Debt yield is immune to loan structure manipulation. It gives lenders a pure, rate-neutral measure of collateral quality.
Most CMBS conduit lenders require 8–10% minimum debt yield. The exact threshold depends on property type, location, and market conditions. Class A multifamily in strong markets may get approved at 7–8%, while riskier property types need 10%+.
Only two ways: increase NOI or reduce the loan amount. Unlike DSCR, changing the interest rate, amortization, or term has zero effect on debt yield. Focus on documenting the strongest possible NOI — including any below-market rents that could be raised.
Lenders use all three as constraints, and the most restrictive one governs the max loan. You might qualify for a $1.2M loan based on LTV, $1.1M based on DSCR, but only $1M based on debt yield. In that case, $1M is your max.
We structure your deal to satisfy debt yield, DSCR, and LTV simultaneously. For CMBS and life company deals, we prepare institutional-quality underwriting packages and connect you with the right capital sources for your property type and deal size.
Our advisors structure your deal to meet debt yield, DSCR, and LTV requirements simultaneously — maximizing your leverage with the right lender.
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