Debt Sculpting Calculator
Enter cash flow available for debt service (CFADS) by period and a target DSCR. This tool sizes the maximum supportable debt, builds the full sculpted repayment schedule with DSCR and LLCR by period, and shows exactly what you give up by repaying on a level annuity instead. Everything runs in your browser — no signup, no upload, no limits.
How debt sculpting works
In project finance, lenders size debt against the cash the project throws off, not against the value of its assets. The measure they use is CFADS — cash flow available for debt service — and the covenant they impose is a minimum DSCR, typically between 1.20x and 1.50x depending on how contracted the revenue is.
Sculpting inverts that covenant. Instead of choosing a repayment profile and checking whether DSCR holds, you fix DSCR at its target and solve for the repayment profile that delivers it:
Once every period's debt service is known, the maximum debt the project can carry is simply the present value of that stream at the loan's periodic interest rate:
Because the debt is sized as the present value of its own repayments, the balance amortises to exactly zero at maturity — no balloon, no residual. The calculator above shows this as the "Balloon / residual" figure, which should always read 0.00 for a well-formed input.
Splitting debt service into interest and principal
Each period's debt service is then decomposed the usual way:
Principal is the residual, which is what gives sculpted debt its characteristic back-loaded profile: early periods are mostly interest, and principal repayment accelerates as the balance falls and CFADS rises.
The DSCR and LLCR check
Under flat-DSCR sculpting, LLCR equals the DSCR target in every single period. That is not a coincidence — it falls out of the algebra. The opening balance at any period is the present value of remaining debt service, which is the present value of remaining CFADS divided by the target DSCR. Dividing PV of CFADS by that balance returns the target exactly. If your own model produces an LLCR that drifts away from DSCR on a flat sculpt, the model has a bug.
Why not just use an annuity?
A level annuity — the mortgage-style repayment most people default to — pays the same amount every period. That is fine when income is flat, and actively expensive when it is not. A project's CFADS is almost never flat: there is a ramp-up, a plateau, and usually a decline as the asset degrades or the offtake contract rolls off.
With a level payment, the DSCR covenant is only ever as strong as the weakest period. The payment cannot exceed the lowest CFADS divided by the target DSCR without breaching, so every other period ends up servicing far less debt than it could afford. That unused headroom is real money — the comparison panel above quantifies it for whatever cash flows you enter.
Read the full breakdown on thesculpted vs annuity comparison page, or see thefull methodology for the derivations.
Frequently asked questions
What is debt sculpting?
Debt sculpting sets each period's debt service equal to that period's CFADS divided by a target DSCR, so the repayment profile follows the shape of the project's cash flows. The result is a constant DSCR across the whole tenor instead of a constant payment.
How is the maximum debt size calculated?
Debt service in each period is CFADS divided by the target DSCR. The maximum supportable debt is the present value of that debt service stream, discounted at the loan's periodic interest rate. Because the debt is sized as the PV of its own repayments, it amortises to exactly zero at maturity.
Why does sculpting support more debt than an annuity?
A level annuity payment is capped by the weakest period: the payment can never exceed that period's CFADS divided by the target DSCR, or the covenant breaches. Every other period then carries far less debt service than it could. Sculpting lets each period contribute its own full capacity, which raises total debt size on identical cash flows.
What is the difference between DSCR and LLCR?
DSCR is a single-period measure — CFADS divided by debt service for that period. LLCR is a whole-of-life measure — the present value of CFADS over the remaining loan life divided by the outstanding debt balance. Under flat-DSCR sculpting the two are equal, which is a useful check that a model is built correctly.
Is this calculator free?
Yes. There is no signup, no paywall and no usage limit. Every calculation runs locally in your browser — your cash flow figures are never sent to a server.