Result
Maximum loan amount
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This calculation is for informational purposes only and does not replace advice from a qualified professional. Formulas and rates may not fit your exact situation — double-check the figures before making decisions.
How it is calculated
Maximum loan amount = EBITDA × target Debt/EBITDA multiple. This is the reverse of the ordinary Debt/EBITDA ratio: instead of dividing existing debt by EBITDA, here an acceptable multiple is set upfront and the debt amount is derived from it.
This way of setting a lending limit is common in bank and bond covenants: instead of a fixed amount, the limit is tied to the company's EBITDA and automatically rises or falls with it.
The calculation doesn't account for existing debt — if there is any, the resulting figure is a limit on total debt, not on new borrowing on top of what's already there. It also doesn't replace checking the ability to service debt — use the separate DSCR calculator for that.