debt service ratio

Also found in: Acronyms.

Debt-Service Coverage Ratio

1. In investment real estate, the ratio of annual net operating income on a piece of investment property to its annual debt service. Banks use the DSCR to help determine whether to make or refinance loans for investment property. A DSCR equal to or greater than 1 indicates that the debtor is able to service the debt on the income from the investment property. In personal finance, banks usually require a DSCR of at least 1 to make such a loan, while they generally expect a ratio of 1.2 for commercial projects.

2. In government finance, the ratio of annual export earnings to its annual debt service on external debt.
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debt service ratio

The ratio of debt payments to disposable income; used in evaluating one's eligibility for a mortgage loan. National averages, calculated quarterly for every year since 1980, are provided at the Web site of the Federal Reserve Board, housedebt/default.htm.

The Complete Real Estate Encyclopedia by Denise L. Evans, JD & O. William Evans, JD. Copyright © 2007 by The McGraw-Hill Companies, Inc.
References in periodicals archive ?
Table--1 Indonesia's economic indicators (US$ million) Year Total debt GDP on Foreign Exports of current exchange goods prices reserves and services 2006 132,633 369,351 42,586 122,493 2007 141,180 438,329 56,920 140,772 2008 155,080 515,557 51,639 165,796 2009 172,871 544,350 66,105 141,963 2010 202,413 713,705 96,207 184,301 2011 210,080 746,257 105,709 195,654 *) *) estimate based on data until March 2011 Source: Bank Indonesia Table--2 Indonesia's foreign debt ratios and DSR Year Debt to GDP Debt to Export Debt Service Ratio Ratio Ratio *) 2006 35.9% 108.3% 25.0% 2007 32.2% 100.3% 19.4% 2008 30.1% 93.5% 18.1% 2009 31.8% 121.8% 23.2% 2010 28.4% 109.8% 22.2% QI 2011 28.2% 107.4% 17.0% Note: Debt to Export Ratio: Ratio of total foreign debts to export earning of a country.
The article also compares the trend in payments on household debt relative to household income, as measured in the CE, with the trend in an analogous aggregate statistic, the household debt service ratio, as measured by the Federal Reserve System.
Conditions were set there too, including: the obligation to protect Endesa's independence and branding, and to keep its decision-making centre in Spain; a limit on Endesa's debt service ratio; the obligation for certain Endesa production units to buy given quantities of coal nationally; the obligation to keep the assets of the insular and non-mainland electricity systems within the Endesa Group.
The debt service ratio according to income classes is for all households, not only for indebted ones.
CCCS said when the debt service ratio was high people had less money available to buy goods and services.
An often-used summary measure of household debt is the household debt service ratio (formerly known as the household debt service burden), which the Board of Governors of the Federal Reserve System first published in 1980.
The debt service ratio has remained at a level of 11%, while principal payments plus short-term debt represent only 23% of foreign exchange reserves.
"The government is reluctant to take on more debt and has pledged to reverse spending patterns, so, the debt service ratio should decline below 7% of GDP in future years compared with 12.7% 2.7% in 1995.
Similarly, debt service ratio at the level of 40.8 percent was also higher when compared with 17.0 percent (3) [sic.] of developing countries and 21.5 percent (3) [sic.] of South Asia.
A second measure is the debt service ratio, which expresses the payments on the debt (debt service) as a percentage of the annual value of exports of goods and services of a country.
The debt service ratio (total external debt service/exports of goods and services) was 52 percent.(6) In 1991, however, China's foreign debt was only 11 percent as large as its annual GNP.
Kenya's export as per percentage of Gross Domestic Product (GDP) has hit a decade low, even as it's external borrowing balloons, worsening the country's debt service ratio.