The ratio is calculated by dividing the property income (rental income) from the property PITIA (principal + interest + taxes + property insurance+ homeowners association dues). The resulting ratio lets the lender know how much income is available to pay the mortgage. A ratio of 1.0x means that the property that the revenue from rental income AND expenses is equal. A DSCR above 1 means the property is positively cash-flowing. Conversely, a DSCR of less than one means that the expenses exceed the rental revenue and the property has a negative cash-flow.