Grow recurring unrestricted giving
Griffin's own guidance on a weak ratio is blunt: increase income without increasing expenses. Recurring, documented giving moves the ratio; pledges and one-time gifts largely do not.
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Church DSCR Calculator
Church loan planning tool
Church DSCR Calculator
Coverage is only one of three ratios a church lender runs. This calculator tests your numbers against all three Griffin publishes — debt coverage, loan-to-value, and debt at four times revenue — then tells you which one limits your loan first.
Written and reviewed by John Berardino, Founder and President, Griffin Church Loans
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- Nothing leaves your browser
- Board-ready printed summary
1999Founded — church lending only
2,000+Church loans closed
$2B+Total closed church financing
$75K–$35MPublished loan range
Run your numbers
Enter one year of figures. Get three constraints, not one.
Quick estimate works from your operating budget. Financial-statement view follows the method Griffin publishes: change in net assets, with interest and depreciation added back. Actual underwriting classifications can differ from either.
Where these numbers come from
- Ratio guidelines (debt coverage 1.0–1.35, loan-to-value 80%, debt at 4x revenue), the change-in-net-assets calculation method, the interest-rate stress test, the three-month cash reserve guideline, and the financial-statement thresholds by loan size are all published by Griffin Church Loans in What are the Guidelines for Church Underwriting?
- Loan range of $75,000–$35,000,000, the 5/7/10/15/20/25/30-year fixed options, and interest-only construction phases are published on About Griffin Church Loans and Church Construction Loans.
- Rate assumption context: the 7.00% default is a neutral planning placeholder. Griffin advertises rates starting from 5.25%, and general conventional commercial mortgage rates were quoted in a roughly 5.6%–8.9% range in late July 2026. Replace the default with a quoted rate as soon as you have one.
The direct answer
What is DSCR for a church?
It measures whether the money left after running the church is enough to make the loan payments.
In plain language
DSCR of 1.25 means the calculation shows $1.25 available for every $1.00 of annual principal and interest. Below 1.00 the entered cash flow does not cover the entered payments. Griffin's published underwriting article calls this the debt coverage ratio, or DCR — the same measure under a different name.
DSCR = funds available for debt service ÷ annual principal and interest
Two ways to reach the numerator
The quick estimate subtracts cash operating expenses from eligible operating income — easier for a board working from a budget. The financial-statement view follows the method Griffin publishes: start with change in net assets and add back interest and depreciation, because both were already deducted and neither is a cash cost of running the church next year.
The two methods will not always agree. Where they diverge, the gap is usually restricted-fund activity, unrealized investment movement, or a large one-time expense sitting inside the statement figure. That gap is worth understanding before an underwriter finds it.
Current versus pro forma
Current DSCR uses existing debt only. Pro forma DSCR adds the proposed payment. For a borrowing decision only the pro forma figure matters, and a strong current ratio says very little about whether the new loan works.
Use one period throughout. Pairing trailing-twelve-month revenue with last fiscal year's expenses is the most common way a church arrives at a coverage number the lender will not reproduce.
Griffin's published guidelines
What financial ratios do lenders use for church loans?
Three ratios decide the loan size, not one. Griffin publishes all three, and the smallest loan any of them permits is the one that governs. A church can pass coverage comfortably and still be capped by collateral or by total debt against revenue. For the underwriting process these ratios sit inside — what a lender reviews, in what order, and what happens after the application — see Griffin's church underwriting guidelines.
| Ratio | Published guideline | What it measures | When it tends to bind |
|---|---|---|---|
| Debt coverage (DCR/DSCR) | 1.0 to 1.35 | Change in net assets plus interest and depreciation, divided by annual principal and interest | Congregations with valuable property but a thin operating margin, or with staffing and facility costs that have grown faster than giving |
| Loan-to-value (LTV) | 80% of appraised value | Loan balance against the appraised value of the collateral | Strong-giving congregations in modestly valued buildings, and special-purpose sanctuaries that appraise conservatively |
| Multiple of income | Debt up to 4x total revenue | Total long-term debt against total annual revenue | Large projects relative to congregation size — often the first constraint to bind on an ambitious build |
Griffin's own caveat: these are guidelines various lenders follow, not fixed rules. Griffin notes that some lenders want 1.5, a few will accept 0.95, and that anything below 1.0 is rare and needs a demonstrable change in the current year's finances to justify.
Reading your result
What each coverage band means
Bands below are anchored to Griffin's published 1.0–1.35 range. They are reference points for a board conversation, not an approval matrix.
Below 1.00Entered cash flow does not cover entered payments. Griffin describes approvals here as rare and requiring extraordinary justification.
1.00 – 1.19Inside the published range but at its floor. Very little room for a soft year, a roof, or a staffing change.
1.20 – 1.34Mid-range. A workable planning zone for most files, with a real but modest cushion.
1.35 and aboveAt or above the top of the published guideline range. Collateral, revenue multiple, reserves, and documentation still apply.
Worked example
A church that passes coverage and is still capped
Illustrative figures, not a Griffin closed loan. Every step is shown so the arithmetic can be checked or reproduced by hand.
1.58
Comfortable coverage, collateral cap
This congregation clears a 1.25 target with room to spare, and cash flow alone would support roughly $1.53M of new borrowing. Collateral permits $1.50M. The property, not the giving, sets the ceiling — and a 15% drop in giving would push coverage below 1.00.
Revenue $900,000 − expenses $610,000
= funds available $290,000
Proposed $1,000,000 at 7.00% over 20 years
= annual P&I $93,036
+ existing P&I $90,000 = $183,036
Pro forma DSCR = 290,000 ÷ 183,036 = 1.58
Cash flow limit 290,000 ÷ 1.25 = 232,000
− 90,000 existing = 142,000/yr → $1,526,000
Collateral limit 2,500,000 × 80% − 500,000 = $1,500,000
Revenue multiple 900,000 × 4 − 500,000 = $3,100,000
Binding constraint: collateral — $1,500,000
Giving −15%: (290,000 − 135,000) ÷ 183,036 = 0.85
= funds available $290,000
Proposed $1,000,000 at 7.00% over 20 years
= annual P&I $93,036
+ existing P&I $90,000 = $183,036
Pro forma DSCR = 290,000 ÷ 183,036 = 1.58
Cash flow limit 290,000 ÷ 1.25 = 232,000
− 90,000 existing = 142,000/yr → $1,526,000
Collateral limit 2,500,000 × 80% − 500,000 = $1,500,000
Revenue multiple 900,000 × 4 − 500,000 = $3,100,000
Binding constraint: collateral — $1,500,000
Giving −15%: (290,000 − 135,000) ÷ 183,036 = 0.85
Reference table
What each loan size requires, on all three ratios
Pre-calculated at 7.00% over 20 years, using Griffin's published guidelines: coverage of 1.25, loan-to-value of 80%, and total debt at four times revenue. Assumes no existing debt. Change the rate or amortization and the payment column changes; the other two do not.
| Loan amount | Annual principal and interest | Funds needed at 1.00 coverage | Funds needed at 1.25 coverage | Minimum appraised value at 80% LTV | Minimum annual revenue at 4x |
|---|---|---|---|---|---|
| $250,000 | $23,259 | $23,259 | $29,074 | $312,500 | $62,500 |
| $500,000 | $46,518 | $46,518 | $58,147 | $625,000 | $125,000 |
| $1,000,000 | $93,036 | $93,036 | $116,295 | $1,250,000 | $250,000 |
| $2,000,000 | $186,072 | $186,072 | $232,590 | $2,500,000 | $500,000 |
| $3,000,000 | $279,108 | $279,108 | $348,885 | $3,750,000 | $750,000 |
| $5,000,000 | $465,179 | $465,179 | $581,474 | $6,250,000 | $1,250,000 |
How to read this: a church with $250,000 of annual revenue and $120,000 available for debt service after expenses can support roughly $1,000,000 on coverage and on the revenue multiple — but only if the property appraises at $1,250,000 or more. Where the three columns disagree, the strictest one applies.
Construction is different
Which payment should a building project be tested against?
The stabilized payment after conversion — not the interest-only payment during the build.
Griffin's construction loans are interest-only during the construction phase and convert to principal and interest once the building is complete, with a single closing covering both the construction loan and the permanent mortgage. That structure protects cash flow while a congregation is still paying for its existing facility, and it is one of the genuine advantages of church-specialist lending.
It also creates a planning trap. Coverage calculated on the interest-only payment will look materially better than coverage on the payment the church will actually carry for the next twenty years. On a $2,000,000 loan at 7.00%, interest-only runs about $140,000 a year; the same loan on a 20-year amortization runs about $186,000. A board that budgets against the first number meets the second one on the day the certificate of occupancy is issued.
How to use this calculator for a construction project: enter the full loan amount with your permanent amortization, not the interest-only figure. If the project will also raise operating costs — a larger building means more utilities, insurance, cleaning, and often staff — add that increase to operating expenses before you read the result. The ratio that matters is the one on the far side of the ribbon-cutting.
Also worth modelling: capital campaign receipts often fall off in the second and third year after a building opens. If your coverage depends on campaign giving continuing at year-one levels, run the −15% column before the board votes.
Income classification
What counts, what gets discounted, what gets set aside
Recurring unrestricted operating revenue is easiest to support. Treatment of everything else depends on documentation and lender policy.
| Generally supportable | May need documentation or adjustment | Usually treated cautiously |
|---|---|---|
| Recurring unrestricted tithes and offerings | Recurring facility or space rental income | Outstanding capital campaign pledges |
| Documented recurring operating revenue | Designated gifts with permitted operating use | Restricted mission or benevolence funds |
| Consistent school, daycare, or program income | Capital campaign funds already received | One-time gifts, bequests, unusual receipts |
| Operating expenses before debt service | Documented nonrecurring expenses added back | Unrealized investment gains, projections |
Responsible improvement
How can a church strengthen coverage?
The goal is durable operating capacity. Reclassifying figures to improve a ratio does not survive underwriting and does not help the church.
Protect the operating margin
Every dollar of recurring expense removed lifts the numerator directly. Review facility contracts, insurance, staffing structure, and reserve needs before adding a payment.
Restructure the request
A smaller loan, more equity, a longer amortization, phased construction, or refinancing existing debt into the new facility can each move the binding constraint.
Beyond the ratios
Coverage does not decide approval on its own
A church can clear all three ratios and still face constraints elsewhere in the file.
Also reviewed
- Three years of profit and loss statements, plus balance sheets where available
- Giving consistency and trend, not just the most recent year
- Cash on hand — Griffin cites roughly three months of church expenses as one reference guideline
- Payment history on existing obligations
- Property marketability and appraisal conditions on special-purpose buildings
- Leadership stability and board authorization to borrow
- Construction scope, budget, timeline, and contingency
- Requested term and rate structure, and whether a guarantee is involved
Financial statements scale with the loan
Griffin publishes a documentation ladder tied to loan size: above $5 million generally means audited statements; $3–5 million may require reviewed statements; $1–3 million can often use compiled statements; and $1 million and below can often use internally prepared statements. The calculator flags the likely tier for whatever loan amount you enter, because getting audited statements prepared is a schedule item, not a formality.
On personal guarantees
Griffin structures almost all church financing without personal guarantees, and pastors and trustees are almost never asked to sign personally. The published exception is a shortfall case — where the loan supportable by the church is less than the price of the property — and Griffin notes that where a guarantee is used, it may be released once the church holds an adequate coverage ratio for a period of time.
For broader planning context, see the 2026 Mid-Year Church Loan Readiness Brief, the Ultimate Guide on Church Finances Best Practices, and How to Finance a Church.
How this page is maintained
The ratio guidelines, calculation method, documentation thresholds, reserve guideline, and stress test on this page are drawn from Griffin's published church underwriting guidelines. Calculation definitions, income classifications, and the worked example were reviewed by John Berardino, Founder and President, on 28 July 2026. Corrections are handled under Griffin's corrections policy.
Questions
Church DSCR questions
What is DSCR for a church?
Debt service coverage ratio compares the funds a church has available for debt service with its annual principal and interest obligations. A DSCR of 1.25 means the calculation shows $1.25 available for every $1.00 of annual payments. Griffin's published underwriting article calls the same measure the debt coverage ratio, or DCR.
What DSCR do church lenders look for?
Griffin's published guidelines describe a debt coverage ratio between 1.0 and 1.35, an 80% loan-to-value guideline, and total debt of up to four times revenue. Griffin adds that these are guidelines rather than fixed rules: some lenders want 1.5, a few accept below 1.0, and ratios under 1.0 are rare and need a demonstrable change in the current year's finances to justify.
Does the DSCR calculation include the proposed new loan?
Yes. A pro forma DSCR includes existing annual principal and interest plus the proposed financing. This calculator shows current and pro forma coverage separately, because only the pro forma figure is relevant to a new loan decision.
Which ratio usually limits a church loan first?
It varies. A congregation with a valuable, low-leverage building but a thin operating margin is usually limited by cash flow. A congregation with strong giving in a modestly valued building is usually limited by loan-to-value. A church seeking a large loan against moderate annual revenue can hit the four-times-revenue debt guideline before either of the others binds. This calculator runs all three and names the one that binds.
Do restricted gifts and capital campaign pledges count as income?
Treatment varies. Recurring unrestricted operating revenue is easiest to support. Restricted funds, outstanding pledges, one-time gifts, and designated receipts may be excluded, discounted, or reviewed separately depending on documentation and lender policy.
How is coverage calculated during a construction loan?
Griffin's construction loans are interest-only during construction and convert to principal and interest at completion, under a single closing. Test the project against the stabilized principal-and-interest payment, not the lower interest-only payment, and add the operating cost of the larger facility before reading the result.
What financial statements will we need?
Griffin ties statement type to loan size: above $5 million generally audited; $3–5 million may be reviewed; $1–3 million often compiled; $1 million and below often internally prepared. Griffin's stated intake is a one-page application plus three years of profit and loss statements, with balance sheets where available.
Why might a lender calculate a different ratio than this page?
Lenders classify revenue and expenses differently, use trailing rather than fiscal periods, normalize unusual items, and treat depreciation, interest, restricted funds, campaign receipts, and proposed debt in ways that vary by file. Griffin also notes that some lenders stress-test coverage at a higher interest rate.
Is this calculator a loan approval or offer?
No. It is an educational preliminary estimate, not a loan approval, commitment, qualification decision, or financial, legal, tax, or accounting advice.
From estimate to real terms
Run the same numbers with a church loan specialist
A preliminary ratio raises the right questions. Griffin reviews the full picture — giving history, property, loan purpose, timeline, and available structures — and issues answers within one business day.