Debt service coverage is one of the first numbers a lender looks at. Work out yours in two steps: your EBITDA from your latest tax return, then your monthly debt payments.
Use your 2025 business tax return. Line numbers are for Form 1120-S (S corporation) and Schedule C (sole proprietor).
1120-S Line 1a · Schedule C Line 1 · for reference, not part of EBITDA
1120-S Line 21 · Schedule C Line 31 · a loss is a negative number
1120-S Line 13 · Sch. C Lines 16a + 16b
1120-S Line 14 · Sch. C Line 13
The same calculation our advisors run when they review a client’s file.
Debt service coverage ratio compares what your business earns to what it owes in loan payments each year. A 1.00x means earnings exactly cover the payments.
EBITDA starts from net income and adds back interest and depreciation, so it shows the cash your operations generate before financing costs and non-cash expenses.
Annual debt service is every monthly loan payment added up and multiplied by twelve. Daily and weekly MCA debits are converted to a monthly figure first.
Business owners and referral partners on what it’s actually like to work with KIBA.
Michael has been great to work with. Communication is always quick, and he genuinely looks out for my best interests rather than just trying to make a quick buck.
I talked with several other bankers before working with Michael, and most of them immediately pushed short-term loans and MCAs with high fees and aggressive payback terms. Michael took a completely different approach. He helped me find the funding I actually needed and guided me through the SBA process.
I expected the SBA process to be long and complicated, but Michael made it surprisingly smooth and moved things along much faster than I expected. He stayed on top of everything, communicated throughout the process, and kept things moving from start to finish.
It is hard to find a banker who takes the time to understand your situation and focuses on what is actually best for you. I highly recommend Michael to any business owner looking for financing.
I recently worked with Michael and his team at Kingdom Impact Business Advisors to secure a new SBA loan, and the entire experience was excellent. The process was simple, and straightforward from start to finish. Michael was easy to work with, communicated clearly, and made what can normally be a stressful and complicated process feel effortless.
Everything moved along smoothly, and I always knew where things stood. I would highly recommend Michael and Kingdom Impact Business Advisors to any business owner looking for financing or help navigating the SBA loan process. Great experience all around!
Working with Michael was one of the best decisions we made during our SBA loan process. He was incredibly thorough, communicative, and persistent. He guided us step by step, was always available with updates and explanations, and made sure we understood exactly what the lender needed. He verified every detail before anything went to the bank, saving us time and headaches. Thanks to his persistence and expertise, we secured the financing we were looking for. I would STRONGLY recommend him to any business owner looking for a smooth, well-managed funding process.
Michael worked tirelessly with us to obtain our SBA loan and helped us understand the process throughout. He made an otherwise stressful process easy and successful! Highly recommend his services!
Michael was excellent in trying to find every possible solution for my funding needs. He stayed connected to the deal at all times to make sure we got to the closing table.
Michael & Barbara helped us navigate the complexities of an SBA loan. They were patient and proficient with their work, and made the process extremely easy. I would work with them again.
We continue to work with Michael because of his deep experience in the lending space and his genuine commitment to doing what’s right for each client. He consistently goes above and beyond, giving every file the care and attention it deserves. That level of effort and integrity is why we confidently refer our clients to him whenever the need arises.
Talk your numbers through with a KIBA advisor — no pressure, no obligation.