Debt Yield Calculator
Debt yield is a simple, lender-focused metric defined as Net Operating Income divided by Loan Amount. It is expressed as a percentage and is used to assess the cash-flow buffer available to cover debt independent of property valuation.
This tool computes current debt yield, expresses it in both percent and basis points, and estimates the maximum loan amount consistent with a user-specified target debt yield. Use conservative inputs and cross-check against other underwriting metrics such as DSCR and LTV.
Governance
Record f304703c8f8b • Reviewed by Fidamen Standards Committee
Inputs
Results
Debt Yield
10.00%
Debt Yield (basis points)
BPS 1,000.00
Maximum Loan for Target Debt Yield
$12,500,000.00
| Output | Value | Unit |
|---|---|---|
| Debt Yield | 10.00% | — |
| Debt Yield (basis points) | BPS 1,000.00 | bps |
| Maximum Loan for Target Debt Yield | $12,500,000.00 | USD |
Visualization
Methodology
Primary calculation: Debt Yield = Net Operating Income ÷ Loan Amount. The result is a decimal that is commonly presented as a percentage (multiply by 100). This calculator treats inputs as point-in-time values; it does not forecast NOI or change loan balances over time.
Accuracy and validation guidance: round inputs to realistic precision (NOI usually to nearest 1,000; loan amounts to nearest 1,000). For financial control and auditability, maintain original source documents for NOI and loan terms. Follow organizational quality-management practices (for example ISO 9001) and numerical best practices (IEEE floating-point considerations) when integrating this calculator into automated workflows.
Key takeaways
This calculator provides quick debt yield computation and a complementary maximum-loan estimate for a user-specified target yield. Use it as part of a broader underwriting process and validate inputs against original financial statements and loan documents.
For regulated or automated deployments, institute numerical validation and traceability practices in line with NIST, ISO, and IEEE guidance.
Worked examples
Example 1: NOI = 1,200,000; Loan = 15,000,000 → Debt Yield = 1,200,000 ÷ 15,000,000 = 0.08 (8%), 800 bps.
Example 2: NOI = 600,000; target debt yield 0.07 → Maximum Loan = 600,000 ÷ 0.07 = 8,571,428.57.
F.A.Q.
What inputs are required?
You must provide Net Operating Income (NOI) and the Loan Amount. Optionally provide a target debt yield (as a decimal) to compute the maximum loan consistent with that target.
Is debt yield the same as DSCR or LTV?
No. Debt yield is NOI divided by loan amount and is independent of interest rate or amortization; DSCR considers debt service and interest rates, and LTV compares loan to property value. Use debt yield as one of several underwriting checks.
How should I format the target debt yield?
Enter target debt yield as a decimal (for example 0.08 for 8%). The calculator will use that value directly to compute maximum allowable loan amount.
What are the accuracy limitations?
This calculator performs straightforward arithmetic. Numerical rounding, inconsistent NOI definitions, or stale loan figures will affect results. For automated or audited uses, follow formal numerical controls and traceability per NIST and ISO recommendations, and validate results against source data.
Sources & citations
- NIST — National Institute of Standards and Technology — https://www.nist.gov
- ISO — International Organization for Standardization — https://www.iso.org
- IEEE — Institute of Electrical and Electronics Engineers — https://www.ieee.org
- OSHA — Occupational Safety and Health Administration (data integrity best practices) — https://www.osha.gov
- HUD — FHA Single Family Housing Policy Handbook 4000.1 — https://www.hud.gov/program_offices/housing/sfh/handbook_4000-1
- HUD — Property Valuation and Appraisals (HUD 4155.2) — https://www.hud.gov/sites/documents/4155-2_4.pdf
- Fannie Mae — Selling Guide — https://selling-guide.fanniemae.com/
Further resources
Versioning & Change Control
Audit record (versions, QA runs, reviewer sign-off, and evidence).
Record ID: f304703c8f8bWhat changed (latest)
v1.0.0 • 2025-11-26 • MINOR
Initial publication and governance baseline.
Why: Published with reviewed formulas, unit definitions, and UX controls.
Public QA status
PASS — golden 25 + edge 120
Last run: 2026-01-23 • Run: golden-edge-2026-01-23
Versioning & Change Control
Audit record (versions, QA runs, reviewer sign-off, and evidence).
What changed (latest)
v1.0.0 • 2025-11-26 • MINOR
Initial publication and governance baseline.
Why: Published with reviewed formulas, unit definitions, and UX controls.
Public QA status
PASS — golden 25 + edge 120
Last run: 2026-01-23 • Run: golden-edge-2026-01-23
Engine
v1.0.0
Data
Baseline (no external datasets)
Content
v1.0.0
UI
v1.0.0
Governance
Last updated: Nov 26, 2025
Reviewed by: Fidamen Standards Committee (Review board)
Credentials: Internal QA
Risk level: low
Reviewer profile (entity)
Fidamen Standards Committee
Review board
Internal QA
Entity ID: https://fidamen.com/reviewers/fidamen-standards-committee#person
Semantic versioning
- MAJOR: Calculation outputs can change for the same inputs (formula, rounding policy, assumptions).
- MINOR: New features or fields that do not change existing outputs for the same inputs.
- PATCH: Bug fixes, copy edits, or accessibility changes that do not change intended outputs except for previously incorrect cases.
Review protocol
- Verify formulas and unit definitions against primary standards or datasets.
- Run golden-case regression suite and edge-case suite.
- Record reviewer sign-off with credentials and scope.
- Document assumptions, limitations, and jurisdiction applicability.
Assumptions & limitations
- Uses exact unit definitions from the Fidamen conversion library.
- Internal calculations use double precision; display rounding follows the unit's configured decimal places.
- Not a substitute for calibrated instruments in regulated contexts.
- Jurisdiction-specific rules may require official guidance.
Change log
v1.0.0 • 2025-11-26 • MINOR
Initial publication and governance baseline.
Why: Published with reviewed formulas, unit definitions, and UX controls.
Areas: engine, content, ui • Reviewer: Fidamen Standards Committee • Entry ID: 3c3af2ecef14