Debt yield = NOI ÷ loan amount. It's the rate-proof way lenders measure leverage. Calculate yours below and see what's typically required.
Leverage, independent of interest rate.
Debt yield is a property's net operating income divided by the loan amount, expressed as a percent. Unlike DSCR or LTV, it ignores the interest rate, amortization, and appraised value — so it gives a lender a clean, rate-proof read on how much income backs each dollar lent. Higher is safer.
Debt yield = NOI ÷ loan amount × 100. Example: a property with $1,000,000 of NOI and an $11,000,000 loan has a debt yield of 1,000,000 ÷ 11,000,000 = 9.1%. To find the largest loan at a target yield, divide NOI by that yield: $1,000,000 ÷ 10% = $10,000,000.
Most lenders set a floor around 9–10%, though it varies by property type, market, and lender appetite — riskier assets like hotels often require more. Because it strips out rate and term, debt yield is the metric that tends to bind in a low-rate environment, when DSCR and LTV would otherwise allow a larger loan.
All three size a loan, and the smallest wins. DSCR depends on the payment (rate and amortization); LTV depends on appraised value; debt yield depends on neither — just NOI and loan size. Lenders use debt yield as a backstop so a low rate or a frothy appraisal can't push leverage too high.