@elbertstreeteta: Financial Model Mini Series Epi 8 - Debt Service Coverage Ratio VERY IMPORTANT TOPIC DCSR = Cash Flow divided my mandatory debt payments (principal and interest). DCSR is expressed as a multiple. You don’t want DCSR to be 1.0x… that would mean just enough cash flow to cover debt payments. Because any hiccups or decline and you would run into payment issues. A safe estimate is 1.25x - 1.3x, meaning you have a 25-30% cash flow cushion to meet debt payments. This is around the minimum threshold for SBA banks as well. Let me know if you have any questions. #buyabusiness #financialmodeling #miniseries #dscr #debtservicecoverageratio

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Thursday 26 June 2025 20:40:27 GMT