What you will explore
Learning objectives
- Recognise the distinct roles of NOI, LTV and DSCR.
- Explain why a change in income can affect several credit signals.
Module 01 / Sample lesson
How NOI, LTV and DSCR Interact
Follow the connections between income, valuation and debt service.
Net operating income (NOI) describes property income after operating expenses, before financing costs. DSCR compares the income or cash flow defined for the analysis with debt service. LTV compares the loan balance with collateral value.
In a simplified synthetic example, $8m of annual NOI and $5m of annual debt service produce a 1.60x coverage ratio. With NOI reduced to $6m, the same debt service produces 1.20x.
Income changes may also affect valuations, but there is no automatic one-to-one relationship. Definitions, appraisal timing and loan terms must remain explicit.
Supporting resources
Reference materials and downloadable PDFs will be added as the course develops.
Sample lessons use simplified synthetic examples for education. They do not represent a real borrower, institution or lending recommendation.