REAL ESTATE GLOSSARY
Debt Yield
Debt Yield
Property NOI divided by the loan balance.
What does Debt Yield mean?
Property NOI divided by the loan balance. Professionals may calculate, document or apply this concept differently depending on the transaction, accounting method, lender policy and governing documents. Borrowers should confirm the precise definition used in any term sheet or agreement.
Debt Yield in context
$600,000 NOI on a $6 million loan produces a 10% debt yield.
Why it matters in financing
Debt Yield can influence how a lender, investor or advisor evaluates risk, pricing, structure, repayment capacity or transaction economics. It should be considered together with the complete financial picture rather than used alone.
Related real estate terms
Educational information only. This definition is general, may not match a particular lender or contract, and is not financial, accounting, tax or legal advice.