How DSCR and ICR actually work, explained with real Nottingham examples
Every lender quote on a commercial investment mortgage tests one of two cover ratios, ICR (interest cover ratio) or DSCR (debt-service coverage ratio). Get the test wrong and the offer prices down at credit committee, or falls over completely. This piece walks through both ratios using real-shape Nottingham investment deals: a Castle Quarter NG1 office let on FRI, a Central Avenue NG2 West Bridgford shop-with-flats parade, a four-asset NG3 / NG5 Mapperley and Sherwood portfolio, and an Eastside / Island Quarter NG1 mixed-use block. We work the numbers at pay rate and at stressed rate, show where each lender sets the threshold, and explain how to engineer the structure (term length, LTV step-down, fixed vs tracker) so the case clears comfortably.
This piece is in preparation.
The outline below is the planned structure for the full piece. Send a topic suggestion or a follow-up question to enquiries@commercialmortgagesnottingham.co.uk and we will work it in.
Coming soon, full guide to DSCR and ICR for Nottingham commercial investment mortgages.
Outline
- Definitions: ICR vs DSCR
- Standard thresholds and the stress test
- Worked example 1: Castle Quarter NG1 single-let office, ICR
- Worked example 2: Central Avenue NG2 West Bridgford semi-commercial parade, blended ICR
- Worked example 3: four-asset Mapperley NG3 / Sherwood NG5 portfolio, DSCR
- Worked example 4: Eastside / Island Quarter NG1 mixed-use block, DSCR with residential blend
- Engineering the cover: term length, LTV, structure
- Lender-by-lender threshold table at mid-2026
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