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Debt Service

Debt service for an investment property is the total annual costs for the principal, interest and charges related to any mortgage taken out for the property.

For example, an investment property has a 300,000 mortgage at an annual rate of 5% interest giving principal and interest payments at approximately 15,000 per annum or 1,250 per month. If there are no other costs related to the mortgage, then the debt service for that property for the year is 15,000.